Interesting exercise. I&#x27;d like to see the justification for the &quot;3&quot; on the right side of the equation though. Does anyone know where that came from or have a reference?<p>A lot of the estimates are really bad and completely ignore sensitivities due to assumptions, especially with CAC in the denominator which can have a massive effect when the range of ratios offered in the article is 0 &lt; r &lt; 3.<p>The difference between a LTV &#x2F; CAC ratio of 2 and 3 is 50%. If CAC is assumed to be $3000 when the ratio is 2, then it only needs to drop by 33% to $2000 to get the ratio up to 3.<p>The author appears to consistently guess at CAC and then completely ignore the fact that a slight shift in the right direction would quickly put a company back in unicorn territory.