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Acquisition

CAC payback calculator

Enter your acquisition cost, what an average account pays each month and your gross margin. The calculator gives the months it takes to earn the cost back.

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CAC payback period

20.8 months

Gross profit per account a month
$96.00

How to read the result

Payback is a cash question: how long your money is tied up in a customer before it comes back. Shorter means you can reinvest sooner and grow on less capital.

It needs to be comfortably shorter than the average customer lifetime. If customers leave before they pay back, growth loses money on every sale.

The formula

Acquisition

CAC payback = customer acquisition cost ÷ (average revenue per account a month × gross margin).

The same sum the calculator above runs

Frequently asked questions

In cash terms, yes. A customer who pays a year upfront can pay back on day one, even though the accounting payback is unchanged.

Because the cost of serving the customer has to be covered before any of their payment goes towards repaying acquisition.

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