P08 / LTV-CACPROFESSIONAL TOOL
LTV & CAC Calculator
Calculate Customer Lifetime Value, CAC ratio, and payback period. Model scenarios including churn reduction, ARPU growth, and high-growth acquisition to stress-test unit economics.
Risk and Coverage Cluster
Professional users usually need to move between exposure sizing, limit adequacy, and scenario modelling. This cluster keeps those supporting paths shallow and crawlable.
Unit Economics
Average Revenue Per User / account per month
Revenue minus direct cost of service
% of customers cancelling each month
Acquisition
All-in cost to acquire one customer
Used for cohort revenue projection
Modelling
WACC or cost of capital for DCF LTV
LTV : CAC
3.61×
LTV : CAC RATIO
LTV:CAC 2.5–4× — solid economics. Monitor churn and acquisition cost trends.
Simple LTV
£3,065
28.6 month avg life
DCF LTV
£2,194
At 10% discount rate
CAC
£850
Payback Period
7.9 mo
Months to recover CAC
Monthly Cohort Value (DCF)
£263,241
120 new customers × DCF LTV
Retention Curve (43mo)
Month 0Month 43
Scenario Analysis
Base
3.61×
LTV £3,065
Payback 7.9mo
Good
−40% Churn
6.01×
LTV £5,109
Payback 7.9mo
Excellent
+15% ARPU
4.15×
LTV £3,525
Payback 6.9mo
Excellent
2× Growth
3.47×
LTV £3,831
Payback 10.3mo
Good
INDICATIVE ONLY — LTV and CAC calculations depend on stable churn and margin assumptions. Triangular distribution LTV and DCF projections are modelling tools only. Actual outcomes depend on product mix, market conditions, and customer behaviour. Consult your finance team for board-level unit economics reporting.
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Related Guides
Use these supporting explainers when you need the formula, assumptions, or decision framing behind the numbers.