Unit Economics Calculator

Analyze per-customer profitability from top-line revenue down to net margin. Model contribution margins, servicing costs, and break-even customer counts.

Unit Economics Calculator

Analyze per-customer profitability, contribution margins, and full business viability — including all customer servicing costs.

Revenue Inputs

$
%
%

Acquisition Costs

$
$
$

Monthly Servicing Costs

$

Pro-rated CS/support allocation

$

Hosting, storage, compute per seat

LTV:CAC Ratio

10.4:1

Excellent

For every $1 of CAC, you generate $10 LTV

Customer LTV

$3,321

Over 2y 5m avg lifespan

Contribution Margin

69.3%

$103/mo per customer

Per-Customer Revenue Waterfall

Monthly Revenue (ARPU)$149
− COGS / Direct Costs (22.0%)−$33
= Gross Margin Revenue$116
− Support Cost−$8
− Infrastructure Cost−$5
= Net Contribution / Month$103

Payback Period

3.1 mo

To recover CAC

Net Profit / Customer

$2,629

Over lifetime

Net Margin

61.8%

All costs included

Break-Even Customers

11

To cover S&M overhead

First-Year Customer Economics

Year 1 Revenue

$1,788

Year 1 Profit

$919

Year 1 Margin

51.4%

Unit Economics Health Check

LTV:CAC 10.4:1 — excellent. Your unit economics are very strong.

Contribution margin 69.3% — exceptional. High-margin SaaS.

Break-even at 11 customers to cover sales & marketing overhead of $156,000/yr

SaaS Unit Economics Benchmarks

Gross Margin

  • • World-class: 80–90%
  • • Good: 70–80%
  • • Acceptable: 60–70%
  • • Below: <60%

LTV:CAC Ratio

  • • Excellent: 5:1+
  • • Good: 3:1–5:1
  • • Marginal: 1:1–3:1
  • • Bad: <1:1

Payback Period

  • • Excellent: <12 months
  • • Good: 12–18 months
  • • Average: 18–24 months
  • • Slow: >24 months

How to Use the Unit Economics Calculator

1. Enter Revenue Inputs

Start with your average revenue per customer per month (ARPU), gross margin percentage, and monthly churn rate. These drive the core LTV calculation.

2. Add Acquisition Costs

Enter your blended CAC (cost to acquire one customer), plus monthly sales payroll and marketing spend. The latter two drive your break-even customer count.

3. Model Servicing Costs

Add per-customer monthly costs for support (pro-rated from your CS team) and infrastructure (hosting/compute/storage per seat). These flow through to contribution margin.

Understanding SaaS Unit Economics

What Are Unit Economics?

Unit economics measure the revenues and costs associated with one unit of your business — in SaaS, typically one customer. They answer the most fundamental question: Is serving each customer profitable?

Strong unit economics means you make money on each customer you acquire and retain. Weak unit economics means you're burning cash on every customer — and adding more customers only accelerates the burn.

The Unit Economics Waterfall

Monthly Revenue (ARPU)What you charge per customer per month
− COGSDirect costs: payment processing, hosting, third-party APIs
= Gross Margin RevenueRevenue after direct costs (typically 70–90% for SaaS)
− Servicing CostsSupport time, infrastructure, customer success allocation
= Contribution MarginTrue profitability per customer before CAC amortization
− CAC AmortizationAcquisition cost spread over customer lifetime
= Net Profit Per CustomerTrue economics after all costs

SaaS Gross Margin Benchmarks

Gross margin is one of the most watched SaaS metrics by investors. It reflects your operational leverage — how much revenue drops to gross profit as you scale.

Pure SaaS (Software-Only)

  • • World-class: 80–90%
  • • Typical public SaaS: 70–80%
  • • Below benchmark: <65%

Service-Heavy / Infrastructure

  • • Usage-based compute: 60–75%
  • • Managed services: 40–65%
  • • Professional services: 20–40%

Contribution Margin: The Real Health Check

Many founders optimize gross margin while ignoring servicing costs. Contribution margin — which includes support, CS, and infrastructure per customer — is the true signal of how much each customer contributes before overhead allocation.

Strong (>50%)

High operational leverage. Each customer meaningfully contributes to overhead and profit.

Moderate (25–50%)

Adequate, but watch servicing costs as you scale. Some overhead-heavy businesses operate here.

Thin (<25%)

Risky. Even modest support or infrastructure cost increases can flip customers unprofitable.

How Investors Read Unit Economics

Savvy investors look at unit economics progression over time — not just current snapshot values. They want to see that unit economics improve as you scale.

  • ✓Improving gross margin shows product-led cost efficiency as scale reduces per-unit COGS
  • ✓Declining CAC signals improving brand/word-of-mouth and channel optimization
  • ✓Rising LTV:CAC means customers are worth more per dollar of acquisition spend
  • ✗Deteriorating contribution margin suggests support costs or infrastructure aren't scaling — a product problem

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