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Simple DCF Calculator

Discounted Cash Flow valuation. Project FCF, apply a terminal value, discount to present. The math behind public-market and pre-acquisition valuations.
Enterprise value (DCF)
$160.5M
PV of explicit FCF
$40.0M
PV of terminal value
$120.6M
Year-by-year projection
YearFCFPV
1$6.5M$5.8M
2$8.4M$6.7M
3$11.0M$7.8M
4$14.3M$9.1M
5$18.6M$10.5M
When DCF works (and when it doesn't)DCF requires somewhat predictable cash flows — usually growth-stage and beyond. For early-stage startups, DCF inputs are too speculative; use VC method, Berkus, or scorecard methods instead.

What is the simple dcf calculator?

DCF (Discounted Cash Flow) values a company as the present value of its expected future cash flows.

The formula: project FCF for N years, project a terminal value at year N+1, discount everything back to present at your cost of capital. Sum it up — that's the enterprise value.

Why this matters for founders & operators

DCF is the gold-standard valuation methodology for public companies and late-stage M&A. It's not a great fit for early-stage startups — the inputs (long-term FCF projections) are speculative.

Use DCF when:

  • You're at growth stage with predictable cash flows.
  • You're modeling an acquisition target.
  • You're valuing a public-comparable company for benchmarking.

For early-stage valuation, use the VC method / Berkus / Scorecard calculator instead.

How to use this calculator

  1. 1
    Use realistic growth rates

    30%+ for high-growth SaaS in years 1-3, declining over years 4-N. Don't apply 50% growth for 10 years — DCF math doesn't survive that.

  2. 2
    Use a sane discount rate

    10-15% for established companies. Higher (15-25%) for higher-risk companies. WACC is the textbook answer; in practice use comparable companies' rates.

  3. 3
    Be conservative on terminal growth

    2-4% is the standard range — roughly long-term GDP growth. Higher and the terminal value dominates your valuation in unrealistic ways.

FAQ

What's a typical discount rate for SaaS?+
12-15% for established SaaS companies. Higher (18-25%) for earlier-stage or riskier ones. Lower (8-10%) for very stable, predictable businesses.
How sensitive is DCF to inputs?+
Very. A 1% change in discount rate or terminal growth can change the answer 30-50%. Always run sensitivity analysis.
Why does the terminal value usually dominate?+
Because growth × time compounds. The terminal value commonly represents 50-80% of total enterprise value, especially with long projection windows or low discount rates.
Should I use FCF or earnings?+
Free cash flow. Earnings are an accounting measure; FCF is what actually flows to investors. FCF = operating cash flow − capex.