The CEO of a startup company thinks the exit will be an IPO ten years from now, valued at 20x their tenth-year earnings,

[answerhappygod]

The CEO of a startup company thinks the exit will be an IPO ten
years from now, valued at 20x their tenth-year earnings, which are
forecasted to be $50mm; when you ask him why 20x, he says it's
because that equals $1b. The CFO thinks the exit is more likely to
be a sale of the company five years from now to O’Neill, a sporting
goods company which is run by SJSU graduates, for about $500mm,
which is what O’Neill recently paid to purchase a maker of
solar-heated wetsuits; however, that company had $250mm in sales at
the time O'Neill bought it. Additionally, using a 20% discount
rate, calculate the differences in current valuation that their two
different strategies would result in (Using DCF
method and Perpetual growth method
to calculate)