Subscription Payback Period Calculator
With churn, and the cash a cohort ties up.
Payback period
14 months
10.0 months ignoring churn
Each month's cohort ties up $46,800 for 14 months. Doubling acquisition doubles the outstanding balance, which is the constraint that stops subscription businesses growing as fast as their unit economics suggest.
How the Subscription Payback Period Calculator works
The usual calculation divides acquisition cost by monthly contribution and assumes nobody leaves. They do — the cohort decays while it pays you back, which pushes real payback out and, at high churn, can mean it never arrives at all.
Not financial advice. Marketplace fees change, and they vary by country, plan and seller status. Every rate here is an editable default, not a quoted price — check the platform's current fee schedule before you price a product against it. This is not tax or business advice.
Frequently asked questions
How should payback be calculated?
Accumulate monthly contribution while shrinking the cohort by the churn rate, until the total covers acquisition cost. Simple division systematically understates the period.
What payback period is acceptable?
Under twelve months is generally considered healthy for subscription businesses; under six is strong. Beyond eighteen, growth becomes constrained by funding rather than demand.
Can payback be impossible?
Yes. If churn is high enough, the cohort's total lifetime contribution never reaches acquisition cost. The business is then paying for customers it can never recover.
Why does this constrain growth?
Because each month's cohort ties up cash until it repays. Doubling acquisition doubles the outstanding balance, which is why unit economics that look fine still stall growth.