ltv-cac-and-payback-period

name	ltv-cac-and-payback-period
description	Use when evaluating channel-level unit economics. Payback period = months to recoup CAC.

LTV/CAC and Payback Period

Payback period = CAC / monthly contribution margin. Healthy: 6-12 months. >24 months = unsustainable.

Calculating payback

Example: $200 CAC, $30/mo revenue, 70% gross margin Monthly contribution: $30 × 0.70 = $21 Payback: $200 / $21 = ~10 months

Healthy. 12-month LTV: $30 × 12 = $360, LTV/CAC = 1.8 (acceptable but improve) 24-month LTV: $720, LTV/CAC = 3.6 (strong)

Per-channel payback

Different channels have different payback periods:

• Brand search: 1-3 months (highest intent)
• SEO content: 6-12 months (compounding)
• Paid search: 3-9 months
• Paid social: 6-18 months (lower intent)
• Display: 12+ months (top-funnel)

Allocate budget by payback × LTV potential.

Cohort payback tracking

Track cohorts:

1. Acquisition month
2. Acquisition channel
3. CAC by channel
4. Monthly revenue per cohort
5. Cumulative revenue
6. Month payback achieved

Identify: which channels payback fastest? Which retain longest?

Where this fits in the X3 empire

Unit economics framework for CardPrepAI portfolio.