Does AdWords deliver positive ROI to your startup?

Anyone have any success or failure stories?

I've had really mixed experience using AdWords to acquire customers (profitably) for B2B Software as a Service Products.

If you calculate your Cost Per Acquisition as (AdWords CPC * Onsite Conversion Rate) then you may be paying hundreds of dollars for a client worth maybe $10-50 per month. Fine if you know they subscribe for 2 years, but if they quit in 3 months you're losing money.

Am i thinking about this right?