2) A technology start-up with recurring SaaS sales has a customer retention rate of R% YoY, a monthly net flow of (X) dollars per customer (cost-free), a customer acquisition cost of (Y) dollars and a discount rate of 25%. The other company has annual fixed costs of (F) dollars, which are not associated with customers. The idea is to have (N2025) clients in the year 2025.

(2a) How much would you value the company? Explain the business case that would justify investing. The numerical values of R,X,Y,F are :

(R)= 70%

(X) =600

(Y)= 10,000

(F)= 1,000,000

(N2025)= 5000

r.=25%

Do the calculations and explain step by step.

(2b) Indicate how much you would be willing to pay to raise the customer retention rate by 1 percentage point.