Pitch Yatravik Fleet Software, which sells operating software to intercity bus operators, in the room: 1,900 buses at Rs 2,500 a bus a month, 6% monthly additions, 1% churn, raising Rs 25 crore at Rs 150 crore post. Size ARR 24 months out and say what has to be true.

Yatravik runs the back office of an intercity bus for Rs 2,500 a month, has Rs 5.7 crore of ARR on 1,900 buses, and at a net 5% monthly growth reaches about Rs 18.4 crore of ARR in 24 months, which takes the entry multiple from 26x to about 8x. The deal works if three things hold: the 5% net growth survives the move beyond the first few operator clusters, churn stays near 1% because operators rarely switch software mid-season, and the founders' market estimate of 1.5 lakh buses stands up to a check.

Start with the operator, not the software. A family that owns twelve buses between two cities runs them on phone calls, a notebook and a cashier at the stand; every seat sold through a booking platform has to be reconciled by hand, and nobody knows the fuel cost per trip until the month ends. Yatravik replaces the notebook: it is the operating system for a small bus fleet, priced per bus so that a twelve-bus operator pays Rs 30,000 a month and a two-bus operator Rs 5,000. Why now: the booking platforms have put most intercity seats online, so an operator without software to manage its inventory across them is losing seats, and a Rs 2,500 subscription is small against a bus that earns a few lakh a month.

Then the numbers, briefly. 1,900 buses at Rs 2,500 a month is Rs 47.5 lakh a month, Rs 5.7 crore of ARRAnnual recurring revenue: the monthly subscription revenue multiplied by twelve. It is a run rate, not revenue earned.. Additions of 6% a month are 114 buses this month against 19 lost, net 5%, which is 80% a year. The round is Rs 25 crore at Rs 150 crore post, 16.7% of the company, at 26.3x current ARR. Say the multiple yourself before the partner does; a pitch that hides the price is a pitch the partner stops listening to.

Compound the bus count, not the rupees, because the price per bus is the fixed part. 1,900 times 1.05 to the power 12 is 3,412 buses after a year, Rs 10.2 crore of ARR; to the power 24 is 6,128 buses, Rs 18.4 crore. The Rs 150 crore post-money is 26.3x today's ARR, 14.7x next year's and 8.2x the ARR two years out, so the round is priced on the company it expects to be, not the one it is. By month 24 the company is adding about 350 buses a month, four times today's rate, which is a sales team question as much as a demand question.

Three things, and name them before the partner asks. First, the 5% net growth has to hold as Yatravik leaves the operator clusters where word of mouth did the selling; 6,128 buses is 4.1% of the founders' 1.5 lakh estimate, up from 1.3%, which is plausible only if the next regions behave like the first. Second, churn has to stay near 1%: operators switch software rarely, but they do sell buses, and a bad season could lift it. Third, the market estimate is the founders' own; a check against permit data or the booking platforms' listed bus counts comes before any term sheet. The pitch is a bet that per-bus pricing, low churn and compounding at 5% a month make 26x ARR a reasonable price for a company that will be at 8x in two years.

Say the limits too. ARR is a run rate on monthly subscriptions, so it can fall as fast as it rose. The model ignores price increases, add-on revenue from payments or fuel cards, and the cost of the sales team that has to produce four times today's additions. And a pitch is not a recommendation: it is the clearest statement of what has to be true, so the partner can decide which of those things to go and test.