Want to scale? Make sure your LTV is greater than your CPA

Unusual for Fred Wilson to repost spammy content. Did you count how many times the newsletter - by the way you should subscribe - is mentioned?<p>And then the content was very basic.

I'm surprised he wrote something like this. This seems like the most obvious business information you can write beyond revenue - expenses = profits.

David Skok of Matrix Partners has blogged comprehensively on this topic: <a href="http://www.forentrepreneurs.com/" rel="nofollow">http://www.forentrepreneurs.com/</a><p>The content may seem obvious, but how many startups can you think of that have utterly failed to achieve LTV &#62; CPA?

Actually seems backwards to me. Of course you want LTV &#62; CPA... but when we're talking about scaling, you often get increasing returns to scale. Which means that you can start with a poor LTV/CPA ratio, even an unprofitable one, and end up with a better one after scaling.

tl;dr - You shouldn't spend more to acquire a customer than she is worth to you.