https://substack.com/@saascontentwriter/p-171556627

How I Got Trapped by LTV:CAC

Treated LTV:CAC like a scoreboard

• Higher number = winning
• Low CAC = efficiency
• Everyone applauds
• Reality: High ratios can signal under-investment in growth
• Competitors racing ahead while we stayed cautious

The 7:1 Ratio Shock

• Investor said: “Your competitor is scaling 4x faster… at 3:1”
• Felt proud → puzzled → panicked
• The ratio I thought was safe was actually a red flag in the LTV:CAC trap

Lessons from My 7:1 Ratio Mistake

• Early-stage SaaS (pre-Product Market Fit): 2:1 is okay for testing
• Scaling stage: 3–4:1 balances growth and sanity
• 6:1+ likely means holding back; growth potential untapped

Context Matters