LTV:CAC Ratio of 3:1 — Is My Business Healthy?
An LTV of $300 against a CAC of $100 gives a 3:1 LTV:CAC ratio, widely considered the minimum healthy benchmark for SaaS companies.
How to use this tool
- Enter customer lifetime value (ltv) and customer acquisition cost (cac) in the fields above.
- Results update instantly as you type — or click Calculate.
- Read your ltv:cac ratio and the full breakdown beneath it.
A 3:1 LTV:CAC ratio is the standard benchmark — enter your LTV and CAC to see where your business stands relative to this threshold.
Frequently asked questions
- What LTV:CAC ratio is healthy?
- 3:1 is the widely accepted minimum — you earn $3 for every $1 spent acquiring a customer. Below 1:1 means you lose money on every customer. Above 5:1 often means you could grow faster by investing more in acquisition.
- How do I improve my LTV:CAC ratio?
- You can improve it by reducing CAC (better targeting, referral programs, content SEO) or by increasing LTV (upsells, reducing churn, expanding revenue per customer). Both levers matter.