Many investors and even some fund managers struggle with VC performance metrics. When should we use them? How do we calculate them?
Remember: Some metrics work for LPs, others for funds or portfolios. Context matters - especially the fund's age!
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1οΈβ£Β Total Value to Paid-in (TVPI)
2οΈβ£Β Residual Value to Paid-in (RVPI)
3οΈβ£Β Distributions to Paid-in (DPI)
4οΈβ£Β Multiple on Invested Capital (MOIC)
5οΈβ£Β Internal Rate of Return (IRR)
6οΈβ£Β Maximum Expected Exposure (MEE)
7οΈβ£Β Follow-on Funding Rate (FFR)
8οΈβ£Β Deployment to Fee Ratio (DFR)
What do they mean? How do you calculate them? When are they meaningful? What do you measure and why?
Check out the attached document to learn more π
Thanks, Marc Penkala for sharing this.
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This post was originally shared by Sahil S. on Linkedin.