SaaS Metrics Calculator

MRR (Monthly Recurring Revenue) = active customers × average subscription price. ARR (Annual Recurring Revenue) = MRR × 12. These are the core top-line metrics investors and operators use to track a subscription business's size.

LTV = Average Revenue Per User (ARPU) ÷ Churn rate. If a customer pays $50/month and churns at 3% per month, their expected lifetime is 1 ÷ 0.03 ≈ 33 months, so LTV ≈ $50 × 33 = $1,667. This assumes a constant churn rate over time, which is a simplification but a standard industry approximation.

CAC = Total sales & marketing spend ÷ New customers acquired in that period. It should include all spend that led to those new customers — ad spend, sales salaries, tools — not just ad spend alone, for an accurate figure.

3:1 or higher is the widely-cited healthy benchmark for SaaS businesses — meaning each customer generates at least 3x what it cost to acquire them. Below 1:1 means you're losing money on every customer; above 5:1 might mean you're under-investing in growth relative to your unit economics.

CAC payback period = CAC ÷ ARPU, the number of months it takes for a customer's revenue to cover their acquisition cost. Under 12 months is generally considered healthy for SaaS; shorter payback means faster capital recycling for growth.