LTV vs CAC: The Ratio That Runs Everything | Ep 889

Everything in business changes once you understand this. All you have to do to stay in business is you have to have cash. And in order to have cash, you need to increase what you make versus what you spend to make it. And managing that ratio and the payback period of when you get that money back is going to be the lever on how quickly you can grow and reinvest the money back into your money making machine. I've been in business 14 years.

I have a portfolio of companies that generate, at least last year, over $250 million in aggregate revenue. And if I had to start over from scratch today, this is the most important business concept to learn or that I would focus on. And to be very clear, this is not a tactic, it's not a funnel, it's actually a ratio. And once you understand it, you'll really never look at business the same. And so the way that I like to think about it is that the best model will win, not the best method.

And so a lot of videos that you see, a lot of trainings, a lot of people talking online will talk about specific methods. They'll talk about one, this little trick that they found out, this weird way to do DMs and get into someone's inbox. Those are all methods. But methods always expire.

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