SaaS viability grid: LTV:CAC ratio & CAC payback by price & churn
Short answer: at a $500 acquisition cost and 75% gross margin, only 17 of 25 price/churn combinations clear the healthy 3× LTV:CAC floor — and 4 sit below 1×, meaning each acquired customer destroys value. The breakeven price at 5% monthly churn is $50/mo. A $100/mo plan with 3% monthly churn hits a 5.0× ratio and 6.7-month payback; a $50/mo plan at 5% churn drops to 1.5× with 13.3-month payback. The full 25-cell grid is below.
LTV:CAC ratio by monthly price and churn rate
Rows: monthly price / ARPU. Columns: monthly churn rate. Each cell is the LTV:CAC ratio. Green ≥ 5×, grey 3–5×, amber 1–3×, red below 1×.
| Price \ Churn | 1%/mo | 2%/mo | 3%/mo | 5%/mo | 8%/mo |
|---|---|---|---|---|---|
| $20/mo | 3.0× | 1.5× | 1.0× | 0.6× | 0.4× |
| $50/mo | 7.5× | 3.8× | 2.5× | 1.5× | 1.0× |
| $100/mo | 15.0× | 7.5× | 5.0× | 3.0× | 1.9× |
| $200/mo | 30.0× | 15.0× | 9.9× | 6.0× | 3.9× |
| $500/mo | 75.0× | 37.5× | 24.8× | 15.0× | 9.8× |
CAC payback months by monthly price and churn rate
Same grid, showing how many months of gross profit repay the $500 acquisition cost. Green ≤ 6 months, grey 6–12, amber 12–18, red over 18.
| Price \ Churn | 1%/mo | 2%/mo | 3%/mo | 5%/mo | 8%/mo |
|---|---|---|---|---|---|
| $20/mo | 33.3 | 33.3 | 33.3 | 33.3 | 33.3 |
| $50/mo | 13.3 | 13.3 | 13.3 | 13.3 | 13.3 |
| $100/mo | 6.7 | 6.7 | 6.7 | 6.7 | 6.7 |
| $200/mo | 3.3 | 3.3 | 3.3 | 3.3 | 3.3 |
| $500/mo | 1.3 | 1.3 | 1.3 | 1.3 | 1.3 |
How to read this dataset
- Find your monthly price on the left and your monthly churn rate across the top. The two cells where they meet give you LTV:CAC ratio and CAC payback months simultaneously.
- Red LTV:CAC cells mean you spend more acquiring a customer than that customer ever returns in gross profit. At $500 CAC and 75% margin, a $20/mo plan only breaks even at 1% monthly churn — even then the 3× healthy floor requires a 100-month average customer lifetime.
- Red payback cells (over 18 months) are unsustainable for a bootstrapped founder funding growth from cash flow. Even at $100/mo and 8% churn, payback is still under 7 months because price dominates: payback depends only on price and margin, not churn.
- The two tables tell different stories. Payback measures how fast you recover cash. LTV:CAC measures how much total value you create per customer relative to what you spent to acquire them. You can have fast payback but marginal LTV:CAC ($200/mo at 8% churn: 3.3-month payback, 3.9× ratio — healthy but not excellent).
Want to run your own inputs instead of this grid? Use the Unit Economics Calculator . For the exact math and what the model cannot tell you, read the methodology page . For why the ratio breaks down at pre-seed stage, see LTV:CAC lies at pre-seed , or for what to do when churn is eating your ratio, read how to reduce customer churn .
Methodology
All 25 cells are computed by the Unit Economics Calculator engine at build time. The engine implements:
- Monthly gross contribution = monthly ARPU × (gross margin % / 100)
- LTV = monthly gross contribution × average lifespan in months
- LTV:CAC ratio = LTV / CAC
- CAC payback months = CAC / monthly gross contribution
- Average lifespan = round(1 / (monthly churn % / 100)) — set to the churn-implied value per cell so inputs are internally consistent
- Engine
- Unit Economics Calculator (
unit-economics-calculator) - Source
-
Computed live from
/engines/unit-economics-calculator.js - Grid
- 5 price tiers × 5 churn rates = 25 cells
- Computed
- 2026-05-27
- Held constant
- $500 CAC · 75% gross margin · lifespan = churn-implied months
Every value above and in both tables is the deterministic return value of the shipped engine bundle, recomputed independently in continuous integration and diffed against this page on every build. The engine is pure (no clock, no randomness): the same inputs always produce the same output. No number on this page was hand-typed or estimated.
FAQ
What LTV:CAC ratio is considered healthy for a SaaS startup?
A ratio of 3× or above is the widely cited healthy floor: for every $1 you spend acquiring a customer, you earn $3 in lifetime gross profit. Below 1× you lose money on every customer you acquire. Above 5× is considered excellent and signals you should invest more in acquisition rather than tightening spend.
How does monthly churn rate affect LTV:CAC ratio?
Monthly churn directly sets customer lifetime: 1% monthly churn implies a 100-month average lifetime, while 8% churn compresses that to about 13 months. Because LTV is gross contribution × lifespan, doubling your churn roughly halves your LTV and therefore halves your LTV:CAC ratio, all else equal.
Why does price have a bigger impact on viability than churn for many SaaS products?
Price scales linearly into both LTV and CAC payback speed simultaneously. A 5× price increase from $20 to $100 moves payback from 33 months to under 7 months at the same CAC, while cutting churn from 5% to 1% only doubles customer lifetime. Price is typically the fastest single lever when LTV:CAC is below 3×.