TVPI, DPI and IRR explained for venture investors
Fund managers, angels and LPs · 7 min read · Updated 3 November 2026
Four numbers describe almost every venture portfolio: TVPI, DPI, RVPI and IRR. They answer different questions, and they can tell very different stories about the same fund. Here is what each one means and how to work it out.
The short version
| Metric | Question it answers | Formula |
|---|---|---|
| TVPI | How much value has been created per dollar invested? | (Distributions + current value) ÷ paid-in capital |
| DPI | How much cash has actually come back? | Distributions ÷ paid-in capital |
| RVPI | How much value is still unrealised? | Current value ÷ paid-in capital |
| IRR | How fast is the money compounding? | The annual rate that makes the present value of all cash flows zero |
TVPI: total value to paid-in
TVPI is the headline multiple. If you invested $10M and the portfolio is now worth $18M with $4M already distributed, TVPI is (4 + 18) ÷ 10 = 2.2×.
TVPI includes unrealised marks, so it moves with every new round and every write-down. Early in a fund it mostly reflects valuations, not cash.
DPI: distributions to paid-in
DPI counts only cash returned: exits, secondary sales and dividends. In the example above DPI is 4 ÷ 10 = 0.4×. A DPI of 1.0× means investors have their money back.
LPs watch DPI more closely as a fund ages, because it cannot be marked up. Most venture funds show little DPI for the first five to seven years.
RVPI: residual value to paid-in
RVPI is the unrealised part of TVPI (18 ÷ 10 = 1.8× above). TVPI always equals DPI plus RVPI.
IRR: the time value of money
Multiples ignore time; IRR does not. A 2× return over three years is far better than 2× over twelve. IRR is the discount rate at which the dated cash flows (every cheque out as a negative, every distribution in as a positive, and today’s value of what you still hold as a final positive) net to zero.
Because IRR depends on dates, record the actual date of every cheque and distribution. Rounding everything to the year can move IRR by several points.
Gross versus net
Gross figures are before management fees and carried interest; net figures are what LPs actually receive. When you report to LPs, say which you are showing. Fund-level net IRR is usually several points below gross.
Common mistakes
- Marking companies up without a priced round or a stated method, then losing LPs’ trust when the marks come back down.
- Mixing currencies without converting at the date of each cash flow.
- Leaving written-off companies at cost, which flatters TVPI.
- Comparing an early fund’s IRR with a mature fund’s DPI.
How Foliant calculates them
Foliant works out TVPI, DPI and net IRR for your whole book and for each company from the dated cheques, distributions and current marks you record, and every valuation keeps a stated basis. LP reports are frozen when sent, so the figures an LP saw never change afterwards.
Questions
What is a good TVPI for a venture fund?
It depends on the fund’s age and vintage. Top-quartile venture funds have historically reached roughly 2.5–3× TVPI at maturity, but early-year figures are mostly unrealised and should be read alongside DPI.
Why is my IRR so high when my multiple is low?
IRR rewards speed. A quick markup on a recent cheque can produce a very high IRR on a small multiple. It usually falls as the fund matures.
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