Free LTV Calculator
Calculate customer lifetime value for your SaaS from ARPU, gross margin, and churn. No signup, instant results.
Customer lifetime value
$800
Avg lifetime
20 mo
Profit / user / mo
$40
How the LTV Formula Works
Formula
LTV = (ARPU x gross margin) / monthly churn rate
Example: ($50 x 80%) / 5% = $800
Customer lifetime value answers one question: how much is a new customer actually worth? Every acquisition decision flows from it. If your LTV is $800, spending $200 to acquire a customer is a great trade. Spending $700 is a slow death, even though every month looks profitable on the surface.
This is the standard SaaS version of the formula. It assumes churn stays roughly constant, which is a fair approximation for early-stage products. As you grow, cohort-based LTV adds precision, but this number is the one investors and benchmarks refer to.
SaaS LTV Benchmarks by Segment
Lifetime value scales with price point and churn profile. Rough benchmarks for where healthy SaaS businesses land:
| Segment | Typical ARPU | Monthly churn | Typical LTV range |
|---|---|---|---|
| Prosumer / B2C SaaS | $5-15/mo | 6-10% | $50-200 |
| SMB SaaS | $30-100/mo | 3-5% | $500-2,500 |
| Mid-market SaaS | $200-800/mo | 1-2% | $8,000-60,000 |
| Enterprise SaaS | $1,000+/mo | <1% | $100,000+ |
Treat these as sanity checks, not targets. A prosumer product with $150 LTV is doing fine if it acquires customers for $30 through organic channels; an enterprise product with $80,000 LTV can still be unprofitable if sales cycles cost more than that to run.
Customer LTV vs Loan-to-Value: Same Acronym, Different Worlds
Searching for "LTV calculator" surfaces two unrelated tools, so to be clear: this page calculates customer lifetime value, the SaaS growth metric. The other LTV, loan-to-value, is a lending ratio used for mortgages and car loans (loan amount divided by asset value). If you need to know whether you can drop PMI on your mortgage, you want a loan-to-value calculator; if you need to know how much you can afford to spend acquiring a customer, you are in the right place.
Pair this with our CAC calculator to get your LTV:CAC ratio, and our churn rate calculator to measure the churn input precisely. And if you want to grow LTV-friendly organic channels, start with directory submission - customers acquired through organic search and directories cost nothing per acquisition.
LTV Calculator FAQ
Ready to build high-quality backlinks?
We'll submit your product to 100+ directories and build valuable backlinks for your SEO. Save hours of manual work so you can focus on what's important — selling and building, not submitting boring forms.