Unit Economics Before Growth
Judge whether a growth plan is economically repeatable using LTV and CAC mechanics.
A startup can grow itself into trouble when the unit economics are weak. What the ratio is really asking CAC is the cost to persuade one customer to buy. LTV is the value the customer relationship contributes over time. Comparing them asks whether acquisition creates a repeatable economic asset or merely rents temporary revenue. For finance work, LTV should be grounded in gross profit, because revenue that disappears into delivery cost cannot pay back acquisition. The mechanism Three inputs do most of the work: acquisition cost, gross margin, and retention. Lower CAC helps, but it does not save a leaky…
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