MoIC (Multiple on Invested Capital)
Private Equity glossary · Paper LBOs & Returns Math
Definition
A pure capital multiple with no time dimension: MoIC = TVPI = (Distributions + Residual NAV)/(Paid-In Capital). A 2.0x MoIC means the investor has received back 2× contributed capital. Standalone MoIC is incomplete because it ignores time-value (a 2.0x in 3 years vs. 10 years are very different outcomes) — institutional LPs pair MoIC with IRR (time dimension) and PME/KS-PME (public-market benchmark). Sometimes decomposed into DPI (realized) and RVPI (unrealized): MoIC = DPI + RVPI.
MoIC (Multiple on Invested Capital) in plain English
MoIC just answers 'how many times did I get my money back?' If you put in $100 and end up with $200 of value, that's a 2.0x MoIC. The catch is it completely ignores TIME — doubling your money in 3 years is fantastic, but doubling it over 10 years is mediocre, and MoIC treats them identically. That's why serious investors always pair it with IRR (which captures speed) rather than trusting MoIC alone. It's also often split into money already cashed out (DPI, the 'realized' part) versus paper value still tied up in the investment (RVPI, the 'unrealized' part), which simply add back up to the total.
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