How do you calculate LTV early on?

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How can consultancies and service businesses calculate LTV if they don’t have license fees, or where most customer revenue is realized a long time after the deal is made?

I made a video talking about how B2B founders and CEOs shouldn’t hire for sales if their LTV isn’t yet 3x of CAC (linked below).

I have made a video explaining what other metrics B2B service CEOs and founders can use if LTV seems hard to calculate:

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In short:

Instead of LTV, you guys can look at another metric called 'Cash Collected within 30 days after the deal closed'.

‍This can be:

- The first workshop you invoice,

- Your onboarding fee,

- Or any first invoice you send to the customer.

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The trick is to optimize for Cash Collected to be higher than your CAC. If you manage to get this done, it will be a lot easier to:

- Hire for sales,

- Onboard more new customers more quickly (at least there won't be a cost issue),

- Optimize for faster value delivery to your customer.

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If you manage to get your Cash Collected to be as high as 3x your CAC, you can shout high five and push forward.

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Apply here: comx.io/de/quiz

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https://www.linkedin.com/posts/activity-6706881471468052480-afEm‍