How this number is made
DPI is cash already returned, divided by cash paid in. RVPI is the value still inside the fund, divided by cash paid in. TVPI adds them. A high TVPI with a low DPI is mostly a paper value. None of these is an annual return. Time is not in the ratio. The IRR page is the one that cares about when the cash moved.
- Paid-in is what investors sent in, not the committed amount they have not funded.
- Value remaining is the latest net asset value, which is someone else’s mark.
Formula
DPI = distributed ÷ paid-in. RVPI = value remaining ÷ paid-in. TVPI = DPI + RVPI.
Worked example
With the figures already in the form, tvpi is 2.20.
Questions
Is TVPI the same as a multiple of invested capital?
Yes, when the numerator is distributions plus remaining value and the denominator is paid-in capital.
Why can TVPI look wonderful and the annual return look ordinary?
Because a 2× that took fifteen years is a different investment from a 2× that took three. This page has no dates.