Customer Lifetime Value Calculator

Ask three people for a customer lifetime value and you will get three numbers, because CLV names three different calculations and almost nobody says which one they ran. The Customer Lifetime Value Calculator does all three from the same inputs and puts the model name beside the figure, so the answer can be checked rather than taken on trust.

The gap is not academic. On the sample below, the churn model returns 1,306.67 and the present-value model returns 1,001.31 from identical numbers, a 23% difference that is entirely the choice of formula. If a board deck and a payback model disagree, this is usually why.

Enter an acquisition cost as well and you also get the two figures people actually decide on: the LTV to CAC ratio, and the month the acquisition cost is finally repaid. Everything runs in your browser, so unpublished revenue figures stay unpublished.

Walkthrough: One SaaS Seat, Three Different Answers

Load Sample fills in a subscription seat at 49 per month, 80% gross margin, 3% monthly churn and an acquisition cost of 420, on the churn model. Gross margin works out at 39.20 a month, and 3% churn implies an average lifespan of 33.3 months, so lifetime value is 1,306.67. Against a 420 acquisition cost that is a ratio of 3.11 to 1, just inside the band investors look for, and the cost is repaid during month 11. Now switch to Discounted without touching an input: the same customer is worth 1,001.31 and the ratio falls to 2.38, because money arriving in year three is not worth what money arriving this month is worth.

The Three Formulas, Side by Side

• Simple. Monthly gross margin times a lifespan you supply. Honest when you have real cohort data and want nothing inferred, useless when the lifespan is itself the guess.
• Churn-based. Lifespan is derived as one divided by monthly churn, so 3% churn means 33.3 months. This is the version most blog posts mean, and it quietly assumes churn never changes.
• Discounted. The present-value form, m × r ÷ (1 + d − r), where r is monthly retention and d the monthly discount rate. It is the only one of the three that survives perfect retention, which is the next section.
• The discount rate compounds; it is not divided by twelve. A 10% annual rate becomes 0.797% a month, not 0.833%, and the tool prints the converted figure under the result so the difference is visible rather than buried.
• The month-by-month table is survival-weighted and, on the discounted model, discounted too. It is not a straight line multiplied out, which is why its cumulative column converges on the headline figure instead of overshooting it.

What Happens When Churn Is Zero

• Set churn to 0% and the churn model divides by zero. Customers never leave, so lifetime value is genuinely unbounded, and the tool says so rather than printing a spreadsheet error or an enormous number. Cycle the sample to the fourth entry and you land on exactly this case.
• The stated fix is the discounted model, which stays finite at zero churn because future money is worth less: the same inputs come back at a real figure instead of infinity. Set both churn and the discount rate to zero and nothing bounds the series at all, and that is reported too.
• A margin outside its range is refused with the number you typed: “Gross margin is 140% — it has to sit between 0 and 100.” Revenue must be positive, and the simple model insists on a lifespan above zero rather than quietly returning nothing.
• The table stops at 60 months. If the acquisition cost has not been recovered by then, the tool says that outright instead of leaving you to scroll looking for a row that never turns positive.
• Leave the acquisition cost blank and the ratio and payback figures disappear rather than showing as zero, because no cost is not the same as a cost of nothing.