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Is the annual prepay discount worth the cash acceleration?
Compare discounted annual cash with monthly collection present value at your financing rate.
Example scenario
Editable demonstration inputs, not verified industry benchmarks. Enable JavaScript to calculate your own scenario.
- Monthly subscription / customer
- $1,000
- Annual prepay discount
- 10 %
- Annual effective discount rate
- 15 %
- Customers choosing prepay
- 100
Prepay present-value advantage
Example result only, not a forecast or promise.
- Upfront cash collected
- $1,080,000
- Annual discount conceded
- $120,000
- Monthly collection PV
- $1,113,408
What to do with this result
Evaluate refund and renewal obligations; upfront cash improves timing but does not create additional revenue.
Know what is inside the model.
Planning model, not personalized financial advice. Your inputs remain in your browser.
Calculation method
Monthly collection PV = sum of MRR / (1 + annual rate)^(month / 12), months 1–12. Prepay PV = 12 × MRR × (1 − discount), collected now.
Assumptions and limitations
- Example inputs are editable scenarios, not Aryo results or independently verified industry benchmarks.
- Use one matched customer cohort and consistent periods. Recurring revenue, bookings and cash are different measures.