Revisiting Lifetime Value and Customer Acquisition

A basic model for evaluating web 2 hypergrowth tech businesses is looking at Customer Acquisition Cost (CAC) versus the Lifetime Value (CLV). Everytime you give away tokens can be likened to web 2 marketing spend (CAC), while CLV is the total of economic rewards (such as protocol earnings) that a user brings by using the platform.

So, it's developing that product maturity that then allows you to minimize your cost of customer acquisition and ultimately, if you're building great software, LTVs should be infinite. And so software businesses end up working really well when you build mature products that a customer is then continuing to renew and cost of customer acquisition or ... See more