Calculate how many months it takes to recover customer acquisition cost.
Payback uses gross profit rather than revenue, because only the margin is available to repay acquisition. Comparing payback against average customer lifetime shows whether the model works at all. Payback period determines how much working capital growth consumes: a twenty-four month payback means every new customer is cash-negative for two years regardless of lifetime value.
CAC Payback Period
Payback months = CAC ÷ (monthly revenue × gross margin)
Payback months = CAC ÷ (monthly revenue × gross margin) Payback uses gross profit rather than revenue, because only the margin is available to repay acquisition. Comparing payback against average customer lifetime shows whether the model works at all.
Payback period determines how much working capital growth consumes: a twenty-four month payback means every new customer is cash-negative for two years regardless of lifetime value.
This calculator takes 4 inputs: Customer acquisition cost, Monthly revenue per customer, Gross margin, Monthly churn rate. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.