Hi there,
Thanks for reaching out. It sounds like you're at a really common, but tough, point for a SaaS founder. It's that moment where the product is built, but the engine for growth isn't firing on all cylinders yet. It's completely normal to feel a bit lost in the woods with marketing, specially when you're trying to make every penny of that runway count.
I'm happy to give you some initial thoughts and guidance based on my experience running and scaling campaigns for lots of B2B software companies. The short answer to your problem isn't about finding the perfect budget or flipping a switch to make things 'efficient'. It's about fundamentally rethinking how you approach acquiring customers. It starts not with your ads, but with a brutally honest look at your customer and your offer.
TLDR;
- Your budget ($2k-$4k) is a decent starting point for testing, but your strategy matters infinitely more than the exact number. Don't expect profitability from day one.
- Stop chasing 'efficiency'. Your first goal is to validate your customer targeting and messaging. This initial phase is for learning, and learning costs money.
- The concept of "CAC < LTV" isn't a destination you arrive at, it's a ratio you constantly have to earn. To understand your affordable CAC, you first MUST calculate your Lifetime Value (LTV).
- Your Ideal Customer Profile (ICP) is probably too generic. You need to define them by their career-threatening nightmare, not their demographics. This is the secret to ads that actually get noticed.
- This letter includes a fully functional LTV & Affordable CAC Calculator to help you figure out exactly how much you can and should be spending to acquire a customer.
Let's be honest about your situation... it's about validation, not profit (yet).
You said you're at a "ride or die" point. I get it. The pressure is immense. And because of that pressure, the temptation is to find a magic bullet, a quick fix that makes the campaigns profitable overnight. I'm telling you now, that doesn't exist. Anyone who promises you immediate, profitable scale is either lying or inexperienced. For SaaS, specially B2B SaaS, this is a long game.
Your question about "how long to wait until a campaign becomes efficient" is the wrong question to be asking right now. It frames the initial months as a failure if they aren't immediately profitable. You need to reframe this period. This isn't about profit; it's about validation. You're spending that $2k-$4k a month to buy data and answer some critical questions:
- -> Do we actually know who our best customer is?
- -> Does our messaging resonate with their deepest problems?
- -> Is our offer (e.g., a free trial, a demo) compelling enough to make them act?
- -> Is our website and onboarding process smooth enough to convert that initial interest?
Answering these questions is the real work. The ads are just the vehicle to get you the data. I remember one client, a medical job matching SaaS platform. When they came to us, their Cost Per Acquisition (CPA) was over £100. They were burning cash. It took us months of methodical testing—new audiences, new ad copy, landing page tweaks—to get that down to just £7. It didn't happen in a week. It happened because we treated the initial phase as an investment in learning. You have to be prepared to do the same. Expect the first 3-4 months to be about breaking even at best, and more likely, losing a bit of money in exchange for invaluable market feedback.
Your ICP is a Nightmare, Not a Demographic
Right, this is probably the single biggest peice of advice I can give you. If I had to guess, your current Ideal Customer Profile (ICP) looks something like this: "SMEs in the tech industry, 50-250 employees, targeting CTOs or Heads of Engineering".
Am I close? It's the standard approach, and it's why most B2B advertising is completely ignored. It's sterile, generic, and tells you absolutely nothing of value. It leads to ads that say boring things like "Streamline your workflows with our innovative SaaS solution." Nobody cares. You're not selling to a demographic; you're selling a solution to a painful, expensive, and urgent problem. You need to define your customer by their nightmare.
Your Head of Engineering client isn't just a job title. She's a leader who lies awake at 3 AM terrified that her best two developers are about to hand in their notice because they're sick of dealing with a broken, manual deployment process. She's scared of missing the Q3 product launch deadline, which will get her a roasting from the CEO and put her own job on the line. Her nightmare isn't 'needing a better workflow tool'; it's 'career failure and team collapse'.
Your ad needs to speak directly to *that* nightmare. You have to become an expert in their specific, urgent, expensive pain. Once you isolate that nightmare, everything else falls into place. Your ad copy writes itself. Your targeting becomes laser-focused. You stop looking for "CTOs" and start looking for the online watering holes where stressed-out CTOs go to complain and look for solutions.
Here's how you can visualise the process of finding that nightmare. You need to move from the general to the terrifyingly specific.
Do this work first. Interview your existing customers. Ask them what would have happened if they *hadn't* found your solution. What was the real, tangible business risk? Once you know the nightmare, you have the foundation for your entire marketing strategy.
How to Calculate Your Customer Lifetime Value (and why it dictates your budget)
You asked when you'll get to CAC < LTV. The truth is, you can't possibly know what a "good" Customer Acquisition Cost (CAC) is until you know, with confidence, what a customer is actually worth to you. This brings us to Lifetime Value (LTV). This isn't just a vanity metric; it is the number that tells you how much you can afford to pay to acquire a customer and still build a profitable business. It frees you from the tyranny of chasing cheap, low-quality leads.
Let's break down the maths. It's simpler than you think. You just need three numbers:
- Average Revenue Per Account (ARPA): How much revenue does one customer bring in per month, on average?
- Gross Margin %: After your cost of goods sold (COGS) like server costs, third-party API fees, and dedicated support, what percentage of that revenue is gross profit? For most SaaS, this is high, maybe 70-90%.
- Monthly Churn Rate %: What percentage of your customers cancel their subscription each month? Be honest with this one.
The calculation is straightforward:
LTV = (ARPA * Gross Margin %) / Monthly Churn Rate
Let's use an example. Say your ARPA is £300, your Gross Margin is 80%, and your monthly churn is 5%.
LTV = (£300 * 0.80) / 0.05
LTV = £240 / 0.05 = £4,800
So, each customer you acquire is worth £4,800 in gross profit over their lifetime. Now we can talk about CAC. A healthy, sustainable business model for a growing SaaS company often aims for an LTV:CAC ratio of 3:1 or better. This means for every £1 you spend to acquire a customer, you get £3 back in lifetime gross profit.
With a £4,800 LTV, that means you can afford to spend up to £1,600 to acquire a single new customer. (£4,800 / 3 = £1,600).
Does that number shock you? It should. It changes your entire perspective. Suddenly, a £100 cost per lead from a LinkedIn campaign doesn't look so expensive if you know your sales team converts 1 in 10 of those leads into a customer (making your CAC £1,000). It looks like a bargain.
To make this real for you, I've built a calculator below. Play with the sliders using your own business numbers. This will give you the single most important number for your marketing budget: your Affordable CAC.
Your Offer is Probably Broken (Delete the "Request a Demo" button)
Now that you know your customer's nightmare and how much you can afford to pay to acquire them, we arrive at the most common point of failure in all B2B advertising: the offer.
I'm willing to bet your main call-to-action is "Request a Demo" or "Book a Call". This is, frankly, one of the most arrogant CTAs ever invented. It presumes that your prospect, a busy decision-maker whose nightmare you're supposed to be solving, has nothing better to do than schedule a 30-minute meeting to be sold to. It's high-friction, it provides them with zero immediate value, and it instantly positions you as just another commodity vendor clamouring for their time.
Your offer's only job is to deliver an "aha!" moment. It needs to give them a taste of the solution, a moment of undeniable value that makes them sell themselves on your product. For SaaS founders, you have an incredible unfair advantage here: you can let them use the actual product.
The gold standard offer for a SaaS product is a completely free trial with no credit card required. Or a generous freemium plan. Let them get in. Let them play around. Let them connect their data. Let them experience the transformation from their current nightmare state to the better future your software provides. When the product itself proves its value, the sale becomes a formality. You stop generating Marketing Qualified Leads (MQLs) that your sales team has to chase and start creating Product Qualified Leads (PQLs) who are already convinced and are now asking you how they can pay.
We see this constantly with our SaaS clients. The ones who see the fastest growth and the lowest acquisition costs are the ones with the lowest-friction offers. A free trial isn't just a marketing tactic; it's a sign of confidence in your own product. If you're scared to offer a free trial, you need to ask yourself if your product is actually good enough to sell itself. If it isn't, no amount of clever advertising is going to fix that.
Choosing Your Weapon: Ad Platforms & Budget
Okay, with the foundational strategy in place, we can finally talk about where to actually spend your money. For B2B SaaS, your main battlegrounds are almost always going to be Google Search and LinkedIn. Meta (Facebook/Insta) can work, but it's more specialised. You shouldn't try to be on all of them at once. With your budget, you need to pick one and dominate it before moving on.
1. Google Search Ads: The Demand Catcher
This is for when your prospects are already aware they have a problem and are actively searching for a solution. They're typing things like "best accounting software for startups" or "how to automate employee onboarding" into Google. Your job is simply to show up as the best answer.
- -> Pros: The intent is incredibly high. These people are pre-qualified because they are literally telling you what they want. It often has the shortest sales cycle.
- -> Cons: It can be very expensive and competitive. You're limited by the number of people searching for your solution, so it can be difficult to scale.
- -> When to use it: If there's clear search volume for the problem you solve. You need to do your keyword research. If people are seraching, this is where I'd start.
2. LinkedIn Ads: The Demand Creator
This is for when your prospects are *not* actively looking for a solution. They are suffering from the nightmare, but they might not know a solution like yours even exists. Your job is to interrupt their day with a message so relevant to their pain that they have to stop and listen.
- -> Pros: The B2B targeting is unparalleled. You can target by job title, company size, industry, specific company names, seniority, etc. This is where your "Nightmare" ICP work pays off.
- -> Cons: It's expensive. Clicks and leads cost significantly more than on other platforms. People are there to network, not to buy, so your creative and offer have to be exceptionally good.
- -> When to use it: When you have a very specific, niche ICP and you need to get your message directly in front of them. We've seen great results here, like getting leads for B2B decision makers at a $22 CPL, but you need a solid LTV to make the maths work.
3. Meta (Facebook/Instagram) Ads: The Wildcard
People dismiss Meta for B2B, but that's a mistake. The cost is low, and the algorithm is incredibly powerful. The targeting is less precise than LinkedIn's, but for certain audiences, it can be a goldmine.
- -> Pros: Very cheap reach and clicks compared to LinkedIn. The algorithm is brilliant at finding people who will convert once it has enough data.
- -> Cons: B2B targeting is limited (e.g., 'small business owners', interest targeting). You often reach a lot of irrelevant people to find the few good ones.
- -> When to use it: If your SaaS serves a broader small business audience, or if your ICP has clear, targetable interests outside of their job. We ran a campaign for a B2B software that got 4,622 registrations at just $2.38 each on Meta. It can work spectacularly if your audience is there.
A quick, important note: never, ever run a "Brand Awareness" or "Reach" campaign. You're giving the algorithm a command to find you the cheapest people to show ads to, who are by definition the least likely to ever buy anything. Always optimise for conversions—a trial signup, a lead form submission, a purchase. Awareness is a byproduct of sales, not a prerequisite for them.
So, What Should You Do Next?
This is a lot to take in, I know. It's not a simple checklist. It's a fundamental shift in approach. The good news is that your budget of $2k-$4k per month is a perfectly reasonable amount to start this validation process on *one* platform. Don't spread it thin across Google, LinkedIn, and Meta. Pick one, and commit to it for at least 90 days. That's enough time and money to gather the data you need to make intelligent decisions.
I've summarised my main recommendations into a table for you below. This is the roadmap I would follow if I were in your shoes right now.
This is the main advice I have for you:
| Action Item | Why It Matters | Your First Step |
|---|---|---|
| 1. Define Your ICP's Nightmare | This is the foundation of all effective marketing. Generic messaging gets ignored. Pain-based messaging gets clicks and builds trust. | Schedule calls with your 5 best current customers. Ask them "What was the specific, hair-on-fire problem you were trying to solve when you found us?" |
| 2. Calculate Your True LTV | This number dictates your entire advertising budget. Without it, you're flying blind and will always be too scared to spend what's necessary to acquire great customers. | Use the interactive calculator in this letter. Pull your real ARPA, Gross Margin, and Churn Rate from your payment processor and internal data. |
| 3. Overhaul Your Offer | Your offer must be low-friction and high-value. The "Request a Demo" button is killing your conversion rates. You need to let the product do the selling. | Scrap the demo page. Build a simple landing page for a 14-day, no-credit-card-required free trial. Make it the only call-to-action on your site. |
| 4. Commit to One Platform for 90 Days | You don't have the budget or bandwidth to be average on three platforms. You need to be excellent on one to get meaningful data and find what works. | Do keyword research. If people are searching for you, pick Google Ads. If not, and you have a clear ICP, pick LinkedIn Ads. Allocate your entire budget there. |
| 5. Set a Realistic Timeline & Budget | This process takes time. Expecting profitability in Month 1 will lead to despair and quitting too soon. This is an investment in a predictable growth engine. | Commit your $2k-$4k/month ad spend for a minimum of three months. Judge success not on profit, but on what you've learned about your audience, message, and offer. |
This path isn't easy, and it requires discipline. It's about moving from frantic, hopeful marketing to a methodical, data-driven process of customer acquisition. You have to be willing to be wrong, to test ideas that fail, and to trust the process. This is what seperates the SaaS companies that make it from the ones that become a statistic.
Doing this on your own is tough, especially when you're also trying to run the rest of the business. An experienced partner can help you avoid the most common pitfalls and accelerate this learning curve dramatically. We've run this playbook for dozens of SaaS companies and have seen firsthand what works and what doesn't.
If you'd like to chat more specifically about your product and how we might apply this framework, I'd be happy to offer you a free, no-obligation 20-minute strategy session. We could take a look at your current setup and give you some concrete, actionable advice you can implement right away.
Regards,
Team @ Lukas Holschuh