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This is a good article and, although many people will know these concepts separately, it's good to have them all stitched together. For me the question raises
by brc 12y ago
This is a good article and, although many people will know these concepts separately, it's good to have them all stitched together.
For me the question raises how to get through the dip when your cashburn is higher than your revenue because you haven't accurately established your LTV.
The second part of that is knowing how to price your service so that your LTV will exceed your CAC. You can control both parts of the equation (through efficient customer acuqisition) and by modifying the product price. But they don't work separately on each other - an adjustment in one will reflect in the other.
I guess there is no magic answer to that and it depends on your customers, your competitors and whatever precedents you think may be applicable.