Canada LTV to CAC Ratio Calculator

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Estimate only. Platform fees, taxes and policies vary by country, account, category and date. Verify important decisions against your current statement or official fee schedule.

Customer Lifetime Value —

Customer Acquisition Cost —

Ltv Cac Ratio —

Lifetime Months —

Calculator guide

Use the LTV/CAC ratio as a unit-economics signal

The LTV/CAC ratio compares expected gross profit from a customer relationship with the cost required to acquire that customer. This calculator first estimates LTV from monthly revenue, gross margin and churn.

Use matching populations and cost definitions. Enterprise customers, self-service customers and different channels can have very different sales cycles, margins and retention, making a blended ratio misleading.

A higher ratio is not automatically better. An extremely high result can indicate underinvestment in growth, while an attractive ratio based on optimistic churn or incomplete CAC can be unreliable.

Pair the ratio with CAC payback, cohort retention, cash burn and growth capacity. The ratio describes expected unit economics but not the timing of cash recovery.

Formula

Use the LTV/CAC ratio as a unit-economics signal

LTV/CAC ratio = Estimated gross-profit LTV ÷ Customer acquisition cost

Estimate monthly gross profit per customer.
Estimate lifetime from monthly churn.
Multiply to calculate LTV.
Divide LTV by CAC and review the assumptions.

Worked example

Inputs

Scenario: $2,400 estimated LTV divided by $800 CAC equals a 3.0× LTV/CAC ratio.

Results

Result: $2,400 estimated LTV divided by $800 CAC equals a 3.0× LTV/CAC ratio.

Rounded values; replace assumptions in the live calculator.

Frequently asked questions

LTV to CAC Ratio Calculator FAQ

What should I verify before using this metric?

Verify the time period, population, currency, attribution and revenue or cost definition. Save those assumptions with the report so future comparisons use the same scope.

How accurate is the result?

The arithmetic follows the displayed formula. Accuracy depends on using complete inputs from the same reporting period and applying one consistent definition to customers, revenue and costs.

Can I use another currency?

Yes. Keep every monetary input in the same currency. Ratios and percentages remain comparable, but the calculator does not perform foreign-exchange conversion.

Should I use gross or net revenue?

Use the revenue definition that matches your reporting purpose and keep it consistent across periods. Document whether discounts, refunds, credits and taxes are included.

Why should I compare several periods?

A single month can be distorted by seasonality, annual renewals, campaigns or one-off contracts. Compare a consistent monthly or quarterly series before making a decision.

Is this an accounting standard?

No. It is an independent planning tool. Reconcile the result with your billing platform, analytics system and financial reporting policies.

Are my inputs uploaded?

No. Calculations run locally in the browser and do not require sending calculator inputs to a server.

Primary sources