What is LTV?
Customer lifetime value: the revenue or margin a customer generates over their time with you.
Definition
A simple estimate is ARPU multiplied by gross margin, divided by churn rate. It is a rough guide that improves with cohort data.
Example
ARPU 2,000, margin 80% and churn 3% gives an LTV of about 53,000.
Related terms
Run your billing on autopilot
Products, quotes, recurring invoices, GST and payments in one place, with an AI teammate for the busywork.
Get started free