Use case: SaaS unit economics

This flow connects churn, LTV, CAC payback, and break-even CAC. Use it when evaluating acquisition spend, pricing changes, or new segments.

Recommended steps

  1. Quantify churn impact: churn impact calculator
  2. Estimate LTV from ARPA, margin, and churn: LTV calculator
  3. Convert CAC to a payback period: CAC payback period calculator
  4. Compute a break-even CAC for a target payback: break-even CAC calculator
  5. Translate run-rate into ARR: ARR calculator

Notes

  • Use cohort-based churn where possible (by plan or segment), not blended churn across the entire base.
  • Start conservative: model gross churn first, then test sensitivity with net churn if expansion is strong.
  • Keep CAC definitions consistent across time (include commissions, tools, and headcount allocation).