Analytics and measurement
CAC Payback Period Calculator
Find out how many months a new customer takes to pay back their acquisition cost.
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How to use
- Enter your sales and marketing spend and the new customers it won, or a CAC you already know.
- Enter the average monthly revenue per account.
- Enter your gross margin on that revenue.
- Read the payback in months and the notes on what it assumes.
What it checks and how it works
Months to recover CAC = CAC / (average revenue per account x gross margin), the definition the Corporate Finance Institute gives. CAC itself is sales and marketing spend divided by the new customers won in the same period, unless you enter a CAC you already know.
The formula assumes revenue per account stays flat, that no customer leaves before payback, and that CAC includes the full cost of winning the customer. Using revenue in place of gross margin makes payback look shorter than it is. The Corporate Finance Institute notes that many early-stage companies run past 12 months; whether that is acceptable depends on retention and how the business is funded, so the tool flags long paybacks without calling them good or bad.
Sources
- Corporate Finance Institute: Months to Recover CAC opened 29 Oct 2026
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Questions
About this tool
All the sales and marketing cost of winning the customers in that period: ad spend, salaries, commissions, tools and agency fees. Leaving costs out makes payback look better than it is.
Revenue is not what you keep. Margin is the part of each payment that is left to repay acquisition after the direct cost of serving the customer.
It depends on how long customers stay and how you are funded. A payback longer than the typical customer lifetime loses money, so check your churn before accepting a long one.
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