What is LTV (customer lifetime value)?

Stripe's subscriber lifetime value divides ARPU by subscriber churn rate, and calls it an estimate based on values at points in time. It is quick, but it assumes churn stays steady, which is often untrue for a young app. Realized LTV avoids the assumption by counting only money received, at the cost of waiting for the window to pass.

RevenueDot's Realized LTV per Customer divides the revenue of a period's new customers inside a window (day 0, 7, 14, 30, 60, 90, 180 or 365, or unbounded), minus refunds, by all new customers, paying or not. Realized LTV per Paying Customer divides by only the customers who paid in the window. The newest periods stay incomplete until every customer's window has passed. A prediction chart extends realized LTV with the months ahead predicted from how older cohorts grew at the same age.

Use LTV to cap what you pay to get a customer. If realized LTV at 90 days is $3.00, paying $5.00 per install does not pay back inside 90 days. Say whether your LTV is gross revenue or your proceeds after store commission, and keep the choice the same across reports.

Example

A subscription has $10 of monthly ARPU and 5% monthly churn. Estimated LTV is $10 ÷ 0.05 = $200. If 1,000 new customers bring $3,000 in their first 90 days, realized LTV per customer at day 90 is $3.

Sources: Stripe Docs: Billing analytics definitions · RevenueCat Docs: Charts