What Is LTV (Customer Lifetime Value)?
Lifetime Value (LTV) estimates the total revenue a business can expect from a single customer account. A common formula is Average Revenue Per Account (ARPA) divided by churn rate. A healthy SaaS business targets an LTV:CAC ratio of at least 3:1.
Why it matters: this metric helps founders separate random variation from real business movement. Decisions improve when the metric is tracked in trend form, not one-off snapshots.
How to use it in practice: pair this metric with at least one upstream and one downstream signal. That way, you can explain why it changed and what action should come next.
In AI Co-Founder, this term appears in context with related indicators so you can move from definition to decision without switching tools.