CAC

CAC (Customer Acquisition Cost) is the total cost of acquiring a new customer, including marketing, sales, and related expenses. It's a critical metric for understanding unit economics and business sustainability. A healthy business typically has an LTV:CAC ratio of 3:1 or higher, meaning customers generate 3x more value than it costs to acquire them.

• 1If you spend $10,000 on marketing and acquire 100 customers, CAC is $100
• 2B2B SaaS companies often have CAC of $200-$500 for SMB customers