SAC
SAC (Signup Acquisition Cost) is acquisition cost per signup: total cohort acquisition spend divided by cohort signup count. The denominator is signups, not customers, so if half the signups never pay, SAC doesn't move; only changes in spend or signup volume do.
Definition
SAC (signup acquisition cost) is total acquisition spend divided by signup count — the signup-anchored cost instrument, parallel to value per signup on the revenue side.
What SAC measures
SAC is computed by dividing total acquisition spend for a period by the number of signups generated during that period. The unit is dollars per signup. It is the cost-side counterpart to VPS, which divides total cohort revenue by signup count to produce the revenue-side measurement. Both instruments normalize to the same denominator, which makes them directly comparable as a signup-anchored view of unit economics.
How SAC relates to CAC
CAC is total acquisition spend divided by customer count. SAC uses the same numerator but a larger denominator — every signup, not just the subset who became paying customers. The two are related by conversion rate:
CAC = SAC / conversion rate
If 100 signups cost $10,000, SAC is $100. If 20% of those signups convert, CAC is $500. The same acquisition spend gets read two ways: spread across all signups, or concentrated on the converters.
What moves each instrument
Conversion rate is the variable that splits SAC from CAC. When conversion rate moves — pricing changes, paywall shifts, onboarding improvements — CAC moves with it. SAC does not, because conversion rate isn't in SAC's formula. SAC depends only on acquisition spend and signup volume.
This makes SAC the more stable instrument for diagnosing where an acquisition-cost change originated. A jump in CAC could come from spend-per-signup increasing or from conversion rate falling, and CAC alone can't distinguish them. If SAC is stable while CAC rose, the conversion side moved. If SAC rose, acquisition spend is producing fewer signups per dollar — channel saturation, audience expansion into less-converting segments, or ad-platform cost inflation.
SAC is also the cost basis for SAC payback, the milestone at which a customer's cumulative revenue equals what the offering spent acquiring them as a signup. The population that has cleared this threshold is break-even signups.
Example
A SaaS offering spends $200,000 on acquisition in Q1 and produces 4,000 signups. SAC is $50. If 10% of those signups convert to paying customers (400 customers), CAC is $500.
In Q2, the team changes the paywall and conversion rate drops to 8%. Acquisition spend and signup volume hold steady, so SAC stays at $50. But 4,000 signups now produce only 320 customers, and CAC rises to $625. Reading CAC alone, the team might investigate ad spend or channel mix. Reading SAC alongside it shows acquisition is unchanged — the rise originates downstream of signup, in the paywall change.