CAC Ratio
topic on 3 shows · 5 statements across 3 episodes
the Official SaaStr Podcast 
Top Founders 
20VC
5 statements about CAC Ratio, every show
Kellogg: Good CAC ratio benchmark is 1.5 for enterprise, 1.0 for SMB
“I'd say a 1.5 or less is in enterprise. I mean, here we are back to your question. The bigger the deals, the more permission you have. So an enterprise, I might go one five. In SMB, I might go one O.”
Kellogg: SaaS operators should calculate CAC ratio with new ARR, not net new ARR
“As an operator, I actually just do it on new ARR. My first order CAC is just, it's not net new, because net new introduced churn. You just made my metric more complicated, right? You made it easier to cheat. You took away some of its meaning.”
CAC ratio is superior to the SaaS Magic Number
“CAC ratio to me is superior to the rule of 40. Why? I'm sorry. The SAS magic number. Why? Because you can measure how much sales and marketing investment you need to make for one dollar of new name ARR, and How much sales and marketing, customer success invest…”
Rike: Median SaaS Blended CAC Ratio Was $1.33 in 2022
“In twenty-twenty-two, companies were investing about a dollar 33 of sales and marketing expense fully loaded, that means comp, benefits, everything, to get one dollar of new or expansion arr.”
Kellogg: SaaS CAC ratio averages 1.3; over 3.0 becomes uninvestable
“So I like the CAC ratio very important SAS metric, you know, typically runs around 1.3, you know, below 1.3 is getting to be quite good. Below one is really good. Best I've ever seen was .4. Anything between 1.5 and two people start to scratch their eyebrows a…”