CAC Payback Period Calculator
CAC payback tells you how many months it takes to recover the cost of acquiring a customer. It's a critical cash flow metric — the shorter your payback, the faster you can reinvest in growth.
CAC Payback Period
5.7 months
Rating
Excellent
Formula:
CAC Payback = CAC / (ARPU × Gross Margin)
Benchmarks:
<6 months = Excellent, 6-12 = Good, 12-18 = Acceptable, >18 = Needs Work
What's a Good CAC Payback Period?
Shorter payback means less capital tied up in growth. Here are typical benchmarks for SaaS and subscription businesses:
Excellent
<6 months
Very efficient acquisition
Good
6–12 months
Typical for healthy SaaS
Acceptable
12–18 months
Common in enterprise sales
Needs Work
>18 months
High cash burn risk
How CAC Payback Is Calculated
CAC (Customer Acquisition Cost) includes all sales and marketing spend divided by new customers acquired. ARPU × Gross Margin gives you the monthly gross profit per customer — the actual cash you recover each month.
Why gross margin matters: Revenue alone doesn't pay back your CAC — only profit does. A $100/mo subscription with 70% margins generates $70/mo toward payback, not $100.
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