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Section 11 · Customer Acquisition Cost
CAC, CPA, ROAS, Break-Even
If you don't know your numbers, you're guessing — and losing.
Revenue
Why it works
Profitable scaling requires knowing how much a customer costs and how much they're worth.
Connects to
Revenue
When to use it
Daily. These numbers run your business.
When NOT to use it
Never skip — even free traffic has time and content costs.
How to use it
- CAC = total marketing spend ÷ new customers acquired.
- CPA = ad spend ÷ conversions (lead or sale).
- ROAS = revenue from ads ÷ ad spend (2x = break-even after costs, target 3x+).
- Break-even ROAS = 1 ÷ profit margin (50% margin → 2x ROAS to break even).
- Compare CAC to LTV — healthy ratio is 1:3 or better.
Examples
ROAS
$1,000 spent → $4,200 revenue = 4.2x ROAS.
CAC vs LTV
CAC $50, LTV $300 = 1:6 — green light to scale.