Breaking into GTM

How do I work out CAC payback when I do not have a finance team?

The short answer

Take everything you spent on sales and marketing in a period, divide it by the number of new customers you won in that period, and you have CAC. Then divide CAC by the monthly gross profit one of those customers brings in, meaning their monthly revenue times your gross margin, not their revenue. The answer is how many months it takes to earn back what you spent to get them. Under twelve months is the usual bar for SaaS and the best companies are under six. Two mistakes to avoid: leaving out salaries and only counting ad spend, and using revenue instead of gross profit, which flatters the number by roughly a third.

Go deeper, your way

4 hand-picked resources, 1 India-specific, 4 link-checked. Pick how you want to dig in.

The same ground, at another level

How forecasting and gtm metrics reads from a different seat.

How do I calculate conversion rates by stage, and what do I actually do once I have them? Calculate them on a cohort, not on a snapshot. Take every opportunity created in a month, follow that same set forward, and measure what share reac... Doing the work 3 resources → How do I call a quarterly number I can actually defend to my CEO and my board? Build it three ways and show the range, not a single figure: bottom up from deal level commits with entry criteria applied strictly, top down from ... Leading a GTM team 3 resources → How do the very best forecasting teams actually run their week? They separate three meetings that most teams collapse into one. A deal review, where the conversation is about strategy on named opportunities and ... How the best do it 3 resources →

Terms in this answer

Customer Acquisition Cost Gross Margin

People also ask

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