How do I calculate CAC for a SaaS company?
CAC looks simple and is easy to get wrong. A small change in what you include can halve or double the number.
- What goes into CAC?
- Should salaries be included?
- What is blended CAC?
Customer acquisition cost (CAC) is your total sales and marketing cost for a period divided by the number of new customers won in that period. Include salaries, commissions, ads, tools, agencies and contractors. Track a blended CAC for the whole business and a paid CAC per channel, and match the period to your sales cycle so costs and customers line up.
| Include | Usually exclude |
|---|---|
| Marketing and sales salaries, benefits, commissions | Customer success and support |
| Ad spend, sponsorships, events | Product and engineering costs |
| Agencies, contractors, fractional leaders | Onboarding costs after the sale |
| Marketing and sales tools | General overhead (unless you allocate it everywhere) |
Blended and paid CAC
Blended CAC uses all sales and marketing costs and all new customers. Paid CAC uses only the cost of a channel and the customers it brought. Blended tells you whether the business works. Paid tells you which channel to fund. You need both.
Match the period to the sales cycle
If deals take three months to close, this quarter's customers came from last quarter's spend. Use a lag or a rolling average so a big campaign doesn't look like a failure in the month it runs.
From CAC to decisions
CAC on its own says little. Divide it by gross-margin revenue per customer to get payback, and compare it with lifetime value. Those two numbers decide how much more you can spend.
- Only ad spend in the numerator.
- Counting free signups as customers.
- No lag for long sales cycles.
- Mixing segments with very different deal sizes.
- Changing the definition each quarter.
- One written definition shared with finance.
- Blended and paid CAC both tracked.
- A rolling three-month view for long cycles.
- CAC by segment where deal sizes differ.
- CAC paired with payback in every report.
What founders and researchers say
We read the threads, surveys and reports so you don't have to. Each card is our summary, linked to the source.
Skok defines CAC as total sales and marketing cost divided by new customers, and pairs it with LTV and months to recover CAC.
Read the guide →Median private B2B SaaS spend is 8% of ARR on marketing and 15% on sales. Both belong in fully loaded CAC.
Read the benchmarks →The most common correction in SaaS threads: founders leave salaries out of CAC, which can make it look several times better than it is.
Browse the threads →Community summaries describe recurring themes across many threads. They are not quotes from individual posts.
Read next
Go deeper in the ShoutEx guides, or check the original sources.
Bring your numbers. We'll tell you what we would do, even if it isn't us.
Book a call →Follow-up questions
Should CAC include the founder's salary?
If the founder spends real time selling, include a share. It keeps the number honest for when you hire.
How often should we calculate CAC?
Monthly for tracking, with a quarterly or rolling view for decisions.
What is a good CAC?
There is no single number. A good CAC is one you recover within your payback target on gross margin.