Customer acquisition cost (CAC)
Also called: CAC
The fully loaded sales and marketing cost of acquiring one new customer over a given period.
CAC = Total sales & marketing spend in period ÷ New customers acquired in period
CAC divides everything you spent going to market by the number of customers that spending produced. “Everything” is the operative word: salaries, commissions, benefits, ad spend, events, tooling and the portion of overhead attributable to the go-to-market org. Ad spend alone is not CAC.
The two arguments you will have about CAC
Blended versus paid. Blended CAC divides total spend by all new customers, including those who arrived organically. Paid CAC divides paid spend by customers attributable to paid channels. Blended CAC always looks better and is always less actionable. Report both if you can; report the definition either way.
Timing lag. In B2B SaaS with a six-month sales cycle, the spend in Q1 produces customers in Q3. Dividing Q1 spend by Q1 customers understates CAC when growth is accelerating and overstates it when growth is slowing. Longer averaging windows — trailing four quarters — smooth this considerably.
CAC on its own means nothing
A CAC of $40,000 is catastrophic for a product with $6,000 ACV and unremarkable for one with $250,000 ACV. CAC only becomes meaningful next to what a customer is worth (LTV) and how fast it comes back (CAC payback).
Segment it too. Blending an enterprise motion and a self-service motion into a single CAC produces a number that describes neither.
Stop calculating this in a spreadsheet
Bunny computes SaaS metrics, revenue schedules and retention from your live billing data — because quoting, subscriptions, usage and invoicing all sit in one system.