For a business to be successful the lifetime value (LTV) of its customers must be greater than the cost it pays to acquire a customer (CAC). This Excel calculator provides an estimate of the cost to acquire a customer, its lifetime value, and also three CAC ratios which make it possible for the business to ensure its financial model stays within acceptable parameters.
The customer acquisition cost is calculated by dividing the sales and marketing costs by the number of new customers acquired during an accounting period. To make economic sense the lifetime value of the new customer must be greater that the cost to acquire the customer.
This free MRR saas calculator can be used by a business to help forecast the monthly recurring revenue it has based on customers at the end of each month for the next 60 months. It also allows the number of months to reach a target revenue level to be calculated and shown in graph format.
This free subscription model customer growth calculator can be used by a business to help forecast the number of customers it has at the end of each of the next 60 months. It also allows the number of months to reach a target level of customers to be calculated and shown in graph form.
Assuming the number of new customers added each period in the Saas model is constant, and the rate at which customers leave (the churn rate), is constant, then the future value of an annuity formula can be used to calculate the number of customers at the end of any period.
The template below for a subscription based business revenue projection, can be used to generate a five year annual revenue projection which can be used as the starting point for our Financial Projections Template.
The revenue projection template provides a quick and easy method to estimate revenue generated by customers from a subscription based business model.
Starting with the current number of visitors per month to the website. monthly growth rates for each of the next 5 years are entered. The template allows for visitor/signup and signup/customer conversion rates to be entered, together with a customer churn rate.
The subscription based business revenue projection is useful for any type of subscription based website including software as a service (saas) business models.