In episode #294 of SaaS Metrics School, Ben Murray dives into one of the most important metrics for SaaS operators and investors: CAC Payback Period—with a focus on adapting it for usage-based pricing models.
Whether you’re B2B, B2C, or AI-focused, CAC Payback is a must-have metric when you're investing heavily in go-to-market strategies. But how do you accurately calculate it when your business has subscription + usage revenue?
Ben walks through:
The standard CAC Payback formula and why it matters
How to define "customer" accurately to calculate CAC
How to adjust the denominator of the formula to include usage-based revenue
How to estimate usage revenue when there’s no clear minimum
Public company trends in reporting ARR in usage-based models
Practical judgment calls that SaaS CFOs must make when incorporating usage data
If you're only including subscription ARR in your CAC Payback, but you're generating significant usage revenue—you’re underestimating your efficiency.
Learn more: https://www.thesaascfo.com/how-to-calculate-cac-payback-period-with-variable-revenue/
Coming Up Next:
CAC Payback Period Benchmarks—why you can't just trust the averages you see online.
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