CAC
Customer acquisition cost: fully loaded sales and marketing spend divided by the number of new customers acquired in the same period.
Why it matters
Blended CAC hides the difference between organic and paid acquisition. Investors will ask for both, and a business whose paid CAC is unviable but hidden behind organic volume is a fragile one.
A worked example
$200,000 of sales and marketing spend producing 50 new customers is a blended CAC of $4,000.
What is typical
Expect to present blended and paid CAC separately, plus how each has moved over the last several quarters.
Related terms
CAC payback
The number of months of gross profit required to recover the cost of acquiring a customer.
Read more →Net revenue retention
Revenue from your existing customer base this period versus the same cohort last period, including expansion, contraction and churn.
Read more →Run your raise on this
VCTerminal models these terms on your real cap table, so you can see what a term sheet pays you before you sign it.
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