a. Business model

Waow operates an attractive business model with several revenue sources:

Terminal - Merchants can purchase a terminal for €1,395, supplemented by a monthly cost of €60 for a period of 60 months. The green terminal is already at more than 600 merchants and is increasingly found in stores near you.
 
Subscription Fee - A subscription of €45 per month per terminal provides recurring revenue. However, merchants do not have to pay this subscription fee if they register at least 100 customers and perform 50 transactions per month. This encourages traders to actively use the platform and increases adoption.

Transaction Fees - Waow charges a 1.45% transaction fee on Waow transactions. Since 1 in 5 transactions is a Waow transaction, this provides a substantial revenue source.

This model drives growth through a network effect, where the value of the platform increases as more users participate and actively use the services.

b. Rising transaction volumes

Meanwhile, Waow has already reached more than 150,000 consumers, with marked growth in monthly transaction volumes. A strong increase has been visible since the beginning of 2023, and in May 2024 the transaction volume reached more than 6.5 million euros. The number of monthly transactions rose above 200,000 during the same period. This growth highlights Waow's increasing market acceptance and potential for further expansion.

a. Income statement

Waow has set ambitious growth targets to conquer Belgium and Europe, with a strong focus on expansion into new markets such as Benelux, France, Germany, Italy, Spain and Portugal. Projected sales show a significant increase from 2024 to 2028, with revenues increasing every year due to these strategic expansions. These rising figures confirm confidence in European market expansion and reinforce Waow's position as a market leader in loyalty solutions. 

The cost of sales at the consolidated level remains limited as the main cost is only the purchase of the terminals, which ensures a high gross margin. Rising team costs are explained by the recruitment of sales agents in all countries where Waow operates.

Operating expenses include various categories such as rent of buildings and rolling stock, expenses for communications such as SIM card usage, and license fees. In addition, expenses are incurred for marketing, legal fees, start-up costs, and social secretarial costs. There are also costs associated with agency staff and commissions on sales, which help support day-to-day business operations and the growth of the sales network. These costs contribute to growth and operational efficiency at the consolidated level, while aiming for positive EBITDA in 2026.

b. Cash flow statement.

From 2024 to 2028, there is a clear evolution in Waow's consolidated cash flow by country. In the first years, cash flows are negative, mainly due to start-up in new markets such as Germany, Italy, Spain and Portugal. This is due to the initial costs associated with market entry. From 2026, cash flows improve significantly, with Benelux and France being the first markets to achieve significant positive results, followed by Germany and Italy in 2027. By 2028, all markets are profitable. Total cash flow evolves from €-2,139,095 in 2025 to €19,705,944 in 2028.

The Discounted Cash Flow (DCF) method and Venture Capital (VC) method were used to determine the valuation at the consolidated level.

The Discounted Cash Flow (DCF) method is a valuation approach used to estimate the value of an investment based on expected future cash flows. This method involves projecting the future cash flows and then calculating them back to their present value using a discount rate that reflects the risk of those cash flows. The DCF method is widely used in finance because it provides a detailed and comprehensive valuation that takes into account the time value of money.

The Venture Capital (VC) method, also known as the exit valuation method, is used by investors to estimate the future value of a company at the time of exit, such as a sale or IPO. The method determines the expected future sales value of the company and translates it back to its current value by applying a high return requirement that reflects the risk of the investment. The higher the risk, the higher the required rate of return and the lower the current valuation.

By doing the analysis based on both valuation methods, we derived an enterprise value of 17.3 million euros. By subtracting net financial debt, we arrive at a pre-money equity value of 15 million euros.