Background

Octopus Cloud is the SaaS oriented Company based in Switzerland, specialized in SPLA tools and Reporting. The Company was growing well in terms of sales and getting new customers, but they faced losses in 2016,17. To evaluate the company’s financial health, Octopus Cloud outsources these services to Oak Business Consultant.

Challenge

The company is in the growth stage. They want to know the growth of the company, its profitability, churn rate of customers, CAC analysis and how much they have to put into the marketing budget.

They use Oak Business Consulting services for

  • Financial analysis of the Income Statement
  •  Projections for 3 to 5 years
  • CAC and CLV analysis
  • Analyze which product is having huge profitability and Demand.


Oak Business Consultant helps Octopus Cloud for their Business and financial analysis and forecasted their 3 years growth and profit. We also examine the company’s Fixed Cost, Expenses, CAC and CLV and Churn rate and compared to Industry average, so it gives insight about their performance.”

Solutions

We gave Financial Analysis by giving following Metrics

1. Product Analysis

Oak Business Consultant carefully analyzes their products/ services sales and come to know that 92% of revenue comes from only 8 products/ services out of 23 products services, it means they should focus on their top line products and eliminate the low contributing product from their portfolio.

2. Financial Health Analysis

We provided cash back period with Profit and loss Statement with historical data analysis and 2-year forecast.

2.1 CAC Payback Period

Oak Business Consultant creates Break Even Sheet to calculate their average revenue. We create a financial forecast for 2019 with 10% expected growth in revenue, but with the same average expense. Oak Business Consultant recommended to reduce 30% Expenses, Mostly are fixed cost.

2.2 Break-Even Analysis

2.3 Customer Lifetime Value Analysis

3. Results

  • They achieve a better insight into the company’s product performance, Cost Analysis, Break-even point and CAC with Payback.
  • We also provide recommendations or steps to take actions in the upcoming months for low Fixed cost and Profitability, Average service cost, CAC, CAC Payback Period and Customer Lifetime value.
  • Oak Projection Model help to management to reduce 30% Cost in order to be in profit and track the Actual and Projected figures to measure the performance.

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