What is CAC payback period?

The number of months it takes for the gross margin from a new customer to repay the fully loaded cost of acquiring that customer. Under 12 months is healthy in mid-market B2B SaaS.

Why do unit economics matter post-layoff?

Because the layoff already proved that top-line growth at any cost is not survivable. The next operating phase has to be growth that pays for itself inside a defined window, and unit economics is the lens that proves it.

Glossary

Unit Economics

Unit economics is the per-customer or per-deal profitability lens applied to the GTM motion. It includes customer acquisition cost (CAC), customer lifetime value (LTV), CAC payback period, gross margin per customer, and the fully loaded cost of each sales touch.

For post-layoff sales orgs, unit economics is the lens that matters more than top-line growth. A team can grow revenue while quietly destroying unit economics — adding customers whose CAC payback exceeds 24 months, for example. Sooner or later that catches up with the board.

Healthy unit economics in mid-market B2B usually means CAC payback under 12 months, LTV-to-CAC ratio above 3.0, and gross margin per customer above 70 percent for SaaS or 35 percent for services.

Frequently asked questions

Questions about unit economics

What is CAC payback period?: The number of months it takes for the gross margin from a new customer to repay the fully loaded cost of acquiring that customer. Under 12 months is healthy in mid-market B2B SaaS.
Why do unit economics matter post-layoff?: Because the layoff already proved that top-line growth at any cost is not survivable. The next operating phase has to be growth that pays for itself inside a defined window, and unit economics is the lens that proves it.

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