About the VC Fund Returns Calculator
This calculator converts a venture fund’s gross portfolio performance into the net returns limited partners (LPs) actually receive. Enter the fund size, management fee, gross multiple on invested capital (MOIC), carried interest and how much value has been realised, and it returns net TVPI, DPI and RVPI, the fees and carry paid to the general partner, and a projected net IRR based on a typical capital-call and distribution schedule.
It is useful for emerging fund managers building a fund model, LPs comparing a GP’s gross track record with likely net results, and founders curious about the economics behind venture capital. The gap between gross and net is often larger than people expect: a 3× gross portfolio can become roughly 2× net after a 2-and-20 fee structure.
The model assumes management fees are charged on committed capital for the fee period and paid out of commitments, carry is a European (whole-fund) waterfall with full catch-up on all profit above paid-in capital, capital is called evenly over the investment period and net proceeds are distributed evenly from the first distribution year to the end of the fund life.
With the default inputs, the net tvpi is 2.12 ×. Change any value above to recalculate instantly.
How to use the vc fund returns calculator
- 1Enter the fund size, management fee and how many years fees apply.
- 2Enter the expected gross MOIC of the portfolio.
- 3Set carried interest and the share of value already distributed.
- 4Adjust the capital call period, first distribution year and fund life.
- 5Read net TVPI, DPI, RVPI and the projected net IRR, and check the J-curve.
Formula and method
Management fees are charged on committed capital for the fee period and come out of LP commitments, so only the remainder is invested in companies. The gross portfolio value is invested capital times the gross multiple. In a European waterfall with full catch-up, the GP earns its carry percentage of all profit once LPs get their paid-in capital back, and nothing if the fund does not return capital.
TVPI (total value to paid-in) is net value to LPs divided by paid-in capital, taken here as the full fund. DPI is the distributed part and RVPI the residual (unrealised) part. Net IRR is solved from a cash-flow schedule: capital is called in equal annual amounts from year 0 over the call period and net value is distributed in equal annual amounts from the first distribution year to the end of the fund life.
- TVPI
- Total value to paid-in capital (distributed + remaining) ÷ paid-in
- DPI
- Distributions to paid-in capital — cash actually returned
- RVPI
- Residual value to paid-in capital — unrealised NAV
- MOIC
- Gross multiple on invested capital, before fees and carry
Worked examples
$100M fund, 2 and 20, 3× gross
Ten years of 2% fees use $20M, leaving $80M invested. At 3× that grows to $240M; carry is 20% of the $140M profit, or $28M, so LPs get $212M — 2.12× net TVPI. With 60% realised, DPI is 1.27×. Calls over 4 years and distributions over years 5–10 give a net IRR of about 13.6%.
Smaller fund with higher fees, fully realised
A 2.5% fee for 10 years leaves $37.5M to invest. A 2× gross portfolio returns $75M; carry on the $25M profit is $5M, so LPs receive $70M, a 1.4× net TVPI and roughly a 5.9% net IRR.
Fund that does not return capital
A 1.2× gross result on $80M invested is $96M — less than the $100M LPs paid in once fees are counted. No carry is earned, net TVPI is 0.96× and the net IRR is slightly negative.
Frequently asked questions
What is the difference between TVPI, DPI and RVPI?+
TVPI is total value (cash distributed plus remaining portfolio value) divided by paid-in capital. DPI counts only cash actually returned to LPs, and RVPI only the unrealised value still held. TVPI always equals DPI plus RVPI.
What is a good TVPI for a venture fund?+
Many LPs regard a net TVPI of 2× or more over a fund’s life as strong and 3× or more as top tier, while below 1.5× is often disappointing given venture risk and illiquidity. Compare against funds of the same vintage year.
What does “2 and 20” mean?+
It is the classic venture fee structure: a 2% annual management fee on committed capital (often stepping down after the investment period) and 20% carried interest on profits. Some top-tier funds charge 25–30% carry.
Why is net IRR lower than gross IRR?+
Fees reduce the capital that is actually invested and carry takes a share of profits, so LPs earn less than the portfolio itself. Fees also start in year one while gains arrive years later, which deepens the early J-curve.
What is the J-curve?+
In the early years LPs pay capital calls and fees while portfolio companies are still young, so cumulative cash flow is negative. As companies exit, distributions arrive and the cumulative curve rises — tracing a J shape.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.