Calculate the Customer Lifetime Value (LTV) for a SaaS business based on ARPA, Churn, and Gross Margin.
Business Metrics
Monthly revenue per customer
Typical SaaS: 70-90%
Percentage of customers leaving per month
Lifetime Analysis
Customer Lifetime Value (LTV)$4,000Average net profit per customer
Customer Lifespan50.0 Mo
Monthly Margin$80.00
Growth Levers
Increase ARPA
Add-ons, upselling, or tiered pricing.
Reduce Churn
Product stickiness & customer success.
About this calculator
Overview
LTV represents the total revenue a business can reasonably expect from a single customer account compared to the churn rate. It's a critical metric for determining how much you can spend to acquire a customer (CAC).
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Pro Tips
SaaS companies often target an LTV:CAC ratio of 3:1 or higher.
Reducing churn has the most explosive impact on LTV; a 1% reduction in churn is often worth more than a 10% increase in ARPA.
Calculate LTV by segment to identify your most profitable customer personas.
For enterprise SaaS, include potential expansion revenue in your ARPA projections.
