User Acquisition Math Every Founder Should Memorize
CAC payback, LTV confidence intervals, and the limits of blended metrics.
Three numbers govern whether growth is fundable: payback period, contribution margin, and the retention curve. Everything else is commentary.
01Payback beats ratios
Lifetime value to acquisition cost ratios hide cash timing. Payback period in months tells you how fast capital returns and therefore how fast you can reinvest.
02Treat lifetime value as a range
Early lifetime value estimates extrapolate from small cohorts. Report a range and state the assumed retention curve, then revise as cohorts mature.
03The blended metric trap
Blended acquisition cost improves whenever organic grows, which makes paid look efficient while it is not. Always keep a paid-only view alongside it.
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