Full explanation
CAC measures how much it costs to get one new paying customer. It includes ads, marketing tools, content costs, and any sales effort.
You compute it by dividing your total acquisition spend over a period by the number of new customers you got in that period.
A healthy business has a CAC much lower than the total revenue one customer brings (the LTV). A common target is LTV at least three times higher than CAC.
Concrete example
You spent 500€ on ads last month and got 10 new paying customers. Your CAC is 50€.