CAC payback is the number of months needed to recover customer acquisition cost. Learn how it fits into a SaaS efficiency KPI tree.
CAC Payback Period is the number of months required to recover the cost of acquiring a customer through their gross-margin-adjusted recurring revenue. Formula: CAC ÷ (ARPU × Gross Margin). In a SaaS KPI tree, payback sits on the efficiency branch alongside LTV:CAC and the Magic Number. Best-in-class SaaS businesses target a payback under 12 months; over 24 months usually signals an acquisition-efficiency problem.