Internal Rate of Return (IRR)

Definition

IRR is the annualized rate of return an investment produces, accounting for the timing of cash flows. It is one of the two headline metrics funds report to LPs, alongside MOIC.

Wie es im Fundraising vorkommt

IRR rewards speed: an early exit at a modest multiple can show a high IRR, while a long-held big multiple can show a modest one.

Häufig gestellte Fragen

What is the difference between IRR and MOIC?

MOIC measures how many times the money multiplied, ignoring time; IRR annualizes the return, making timing central.

What IRR do venture funds target?

Top-quartile venture funds have historically aimed for net IRRs in the 20 percent-plus range, though results vary widely by vintage.

Round Funded Ressourcen

Verwandte Begriffe

MOIC (Multiple on Invested Capital)Hurdle RateCarried Interest

Setzen Sie diesen Begriff ein

Definitionen gewinnen nur dann Verhandlungen, wenn Sie sich in einer befinden. Finden Sie die Investoren, die Ihre Phase finanzieren, und beginnen Sie das Gespräch.

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