Why I Rarely Recommend Paid Media for Startups

Finding the Sweet Spot Between LTV and CAC

You may have noticed that I don’t talk a lot about paid media on this platform. It’s not that I don’t use them, or don’t believe they are effective, it’s because they are expensive and the ROI rarely makes sense for startups, which are the type of clients I typically serve.

Ads require a lot of effort, testing, and budget before you start to see them work.

At this point, the cost of user acquisition often exceeds the customer’s lifetime value.

You need to have deep enough pockets to continue to whether that storm until you can figure out your messaging, audience targeting, creative, landing page optimization, retargeting, email flow, sales, customer success, etc. Once you figure that out, and how to optimize revenue, then you can start to sway that balance more in your favour (i.e. LTV > CAC).

To get to this place, it may be many months and thousands or tens of thousands of dollars.

So it’s not that paid media is not on the list of options, it’s just that it’s lower on the list when compared with other options that may be a little less expensive and are easier to test. This is especially true if you are a startup with a lean team and a leaner budget.

Now, if you are a well funded startup, then sure, test it out. Paid media can be effective when trying to increase brand awareness to a particular audience. Having that audience organically discover your brand can often take too long.

When to Use Paid Media

1. You’ve validated your offer.
If you already know your product resonates with your audience — meaning you’ve got proof of demand through organic channels, referrals, or early sales, then ads can help you amplify what’s already working rather than test what’s not.

2. You have a proven funnel.
Before spending on ads, you should already see consistent conversion from organic traffic or other low-cost sources. If your landing page, email nurture, and checkout process convert, ads become a lever, not a gamble.

3. You’re collecting data intentionally.
Paid media is powerful when used for insights. You can test messaging, creatives, and audiences faster than organic growth allows. If you treat ad spend as a learning investment rather than a revenue engine, it’s worth the cost.

4. You’re in a launch or awareness phase.
When timing matters (such as a product launch, rebrand, or event) paid media can generate quick reach and build familiarity within a specific demographic or geography. It’s useful for jump-starting momentum when organic visibility is too slow.

5. You’re scaling what already works.
Once you’ve dialed in your brand story, offer, and funnel, paid media can multiply results. This is where CAC and LTV finally balance out, you’ve built enough brand equity that ads no longer have to work as hard.