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Intermediate
Most CAC math quietly assumes one funnel, and that breaks the moment you have to pay to acquire both sellers and buyers. This piece walks through a fully burdened, two-sided CAC: it allocates seller acquisition cost across the buyer base using your seller-to-buyer ratio, with a worked example you can copy into a spreadsheet. It is the practical companion to the a16z framing, the how after the what.
How to Measure CAC in a Two-Sided Marketplace
From Natalie Luu, Lightspeed Venture Partners (Medium) by Natalie Luu (Lightspeed Venture Partners)
- A real marketplace CAC blends buyer and seller acquisition cost, weighted by how many sellers you need per buyer
- The seller-to-buyer ratio is the lever that decides how heavy each order really is to acquire
- Work it with concrete numbers (their sellers cost 500 each) so your LTV/CAC reflects both sides, not a flattering single-side figure
