Respondents (excluding the smallest companies) spent a median $1.13 to acquire each dollar of new ACV from a new customer. The result drops to $1.00 if we include companies with <$2.5MM in revenues. The median spend to acquire each dollar of new ACV from a new customer this year is similar to last year’s result of $1.18.
Note to regular ForEntrepreneurs readers: The way CAC is measured here is different than how I normally measure CAC (see SaaS Metrics 2.0 – A Guide to Measuring and Improving What Matters). In those posts CAC is the average amount that it costs to acquire a single customer. In this survey, CAC is measured as the cost to acquire a dollar of ACV (annualized contract value).
More SaaS + Software Stats
More Growth Strategy Stats
Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable.