What is Customer acquisition cost (CAC)?

Customer acquisition cost (CAC) is the average amount you spend on sales and marketing to win one new paying customer over a given period.

Formula

CAC = total sales and marketing spend in a period ÷ new customers won in that period

Example

You spend $6,000 on ads and $4,000 on a part-time salesperson in one quarter and win 50 customers. Your CAC is $10,000 ÷ 50 = $200.

Why it matters for early-stage founders

CAC tells you whether growth is affordable. Compared with lifetime value, it shows whether each new customer makes or loses money.

The common mistake

Counting only ad spend and leaving out salaries, tools and founder time. That makes channels look cheaper than they are.

Know what a customer is worth

solvee helps you check whether your channels and price add up to a healthy business.

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Reviewed October 12, 2026