Artisan Design provides creative website services to small and medium-sized companies. We want to the estimate the value of the company today (which we will designate as Year 0). The company has generated $5 million in free cash flow in the most recent year (Year 0). The company expects cash flow to grow at 15% per year for the next two years (Years 1 and 2), 8% per year for the following two years (Years 3 and 4), and 4% per year after that. Artisan is financed with equity capital from its founders and a $20 million loan. Their cost of capital is 10%.

The forecast of the terminal value at Year 4 is: