[ig1]

While these are all reasonable and valid points it's missing a key one: margin.

If you look at successful SaaS businesses users who pay <$50/month are pretty much always loss leaders. Almost all the money in SaaS is in enterprise and large customers.

It's very hard to make subscription work for consumer SaaS businesses simply because the margin between CAC and LTV is so small. Gaming (ala World of Warcraft) has shifted away from subs to IAP because it's easier to lower CAC through making a product freemium than to increase LTV.

Commercially successful dating sites have become so through increasing LTV by locking customers into long term contract and reducing CAC via shady tactics to increase conversion. Neither of which many investors want to be associated with.

[andrew_null]

I actually specifically talk about CAC and LTV and why enterprise/SaaS can drive higher revenues over time. There's a whole section for it.