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LTV

Metrics beginner FOUNDERCMOCFO

What is LTV?

LTV is customer lifetime value, the estimated revenue value of a customer over their lifespan.

Also known as: CLV, Customer Lifetime Value, Lifetime Value

LTV Formula

LTV = ARPA × (1 / CHURN)
Variable Meaning
ARPA Average revenue per account.
CHURN Customer churn rate.
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How to Calculate LTV

Worked example

ARPA (monthly)
$500
Monthly Churn
2%
→ LTV
$25,000

LTV Calculator

Try it with your numbers

LTV$25,000
LTV = ARPA × (1 / CHURN)
Variable Meaning
ARPA Average revenue per account.
CHURN Customer churn rate.

Worked example

ARPA (monthly)
$500
Monthly Churn
2%
→ LTV
$25,000

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Prefer a dedicated page? Use the LTV calculator.

Common Mistakes with LTV

  • Not knowing your unit economics (CAC, LTV, ARPA, ACV, churn, payback months) — teams that cannot quote these numbers under-invest in sales and marketing (typically 10-25% of revenue) and never master paid acquisition or outbound prospecting.

LTV vs Related Metrics

LTV FAQ

How do you calculate LTV?

LTV = ARPA x (1/CHURN)

More questions? See the full LTV FAQ.

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