HOW DO YOU VALUE PREPAID SUBSCRIPTIONS IN A SAAS DEAL?

The SaaS and Software deal experts: How do you value or adjust the price for the future subscription revenue that has already been realized by the owner. A proprietary deal I am working on has almost 40% of their revenue in prepaid annual subscriptions and 10% in 3-year prepaid subscriptions. To make it worse, they also have many lifetime subscriptions they sold years ago to get the traction many years ago! Surely, I am not going to see any revenue from these customers for 1-3 years. but have marginal cost to service and support them. 1. How do suggest structure such a deal? 2. Do debt providers/banks evaluate the annual or multi-year subscription revenue differently than the monthly subscription revenue?



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