3-Year Valuation

Based on our first year financial outlook, we can propose a 3-year valuation on Produce AI.

3-Year Evaluation

Cost Assumptions:

• Cost of Goods Sold (COGS): 40% of revenue.

• Operating Expenses: 10% of revenue.

Year-by-Year Projections

Year 1:

• Revenue: $4,410,600

• COGS (40%): $1,764,240

• Operating Expenses (10%): $441,060

• Net Profit: $2,205,300

• Valuation Range:

  • Low End (5x Multiplier): $2,205,300 * 5 = $11,026,500

  • High End (10x Multiplier): $2,205,300 * 10 = $22,053,000

Year 2:

• Revenue: $5,513,250 (25% increase)

• COGS (40%): $2,205,300

• Operating Expenses (10%): $551,325

• Net Profit: $2,756,625

• Valuation Range:

  • Low End (5x Multiplier): $2,756,625 * 5 = $13,783,125

  • High End (10x Multiplier): $2,756,625 * 10 = $27,566,250

Year 3:

• Revenue: $6,891,562.50 (25% increase)

• COGS (40%): $2,756,625

• Operating Expenses (10%): $689,156.25

• Net Profit: $3,445,781.25

• Valuation Range:

  • Low End (5x Multiplier): $3,445,781.25 * 5 = $17,228,906.25

  • High End (10x Multiplier): $3,445,781.25 * 10 = $34,457,812.50

Summary:

• The business shows a consistent annual growth rate of 25% in both revenue and net profit over three years.

• The cost structure is stable with COGS at 40% and operating expenses at 10% of the revenue, indicating effective cost management.

• By the end of Year 3, the business valuation ranges from approximately $17.23 million to $34.46 million, with a 5x-10x applied multiplier. This range reflects the business's profitability, growth trajectory, and potential future earnings