12 MONEY NUMBERS EVERY ENTREPRENEUR MUST KNOW
"You can suck at math, but you can't suck at money math." — Alex Hormozi
THE 12 METRICS BREAKDOWN
🟣 THE BIG 3 (Master These First)
| # | Metric | What It Tells You |
|---|---|---|
| 1 | LTGP — Lifetime Gross Profit | Total profit from one customer over their entire time with you |
| 2 | CAC — Customer Acquisition Cost | Every dollar spent on marketing + sales + commissions to get ONE customer |
| 3 | LTGP : CAC Ratio ⭐ MOST IMPORTANT | For every $1 spent, how much do you make? This is the #1 metric in any business |
📊 GROWTH & RETENTION METRICS
| # | Metric | What It Tells You |
|---|---|---|
| 4 | Churn | Of customers at the start of the month — how many are still there 30 days later? |
| 5 | ROIC — Return on Invested Capital | How much does it cost to expand, and what do you get back? |
| 6 | Payback Period | How quickly do you recoup your CAC after acquiring a customer? |
📈 VELOCITY & SCALE METRICS
| # | Metric | What It Tells You |
|---|---|---|
| 7 | Sales Velocity × LTGP | Where does the business plateau if nothing changes? Your growth ceiling. |
| 8 | Sales Velocity ÷ Churn | How many customers will you be servicing at steady state? |
WHY LTGP:CAC IS THE KING METRIC
The ratio of how much you make per customer vs. how much you spend to get them is the single most important number in your business. Get this right, and everything else becomes easier to solve.
Target benchmarks:
- 3:1 — Healthy business
- 5:1 — Strong, scalable business
- 10:1+ — You have a money machine
Source: Alex Hormozi — Watch the full short Learn more at Acquisition.com