Running Lean: Iterate from Plan A to a Plan That Works (Lean (O'Reilly))

by Ash Maurya

A product that uses the paid engine of growth relies on reinvesting a portion of customer revenues (lifetime value or LTV) toward customer acquisition activities like buying advertising or hiring sales people. Growth here is driven by keeping customer lifetime value (LTV) > cost of customer acquisition (COCA). A good rule of thumb by way of David Skok, Matrix Partners, is to keep LTV > 3 * COCA.