Why Misunderstanding Startup Metrics Can Cost You Your Business
Mark Suster
77543

Mark — great post as always but had a question on CAC formulas. The formulas out there for CAC seem to over-simplify when applied to Enterprise B2B SaaS sales cycles which can easily range 6–12 months. How do I measure CAC in those instances? For example, For Q1 if I do a simple calc of Q1Cost_Of_Sales/Q1Deals my costs do not reflect money spent in prior quarters for landing Q1 customers. I spent money in both Q3 and Q4 acquiring the customers that closed in Q1…right? So for longer sales cycles what is my CAC formula?

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