Fund Metrics (DPI, RVPI, TVPI)
GPs sell TVPI to raise their next fund. LPs only care about DPI.
DPI (Distributions to Paid-In Capital)
The only metric that matters at the end of a fund's life. It measures the total cash distributed back to LPs divided by the capital they paid in. A 1.0x DPI means they got their money back. Top decile venture funds aim for >3.0x DPI.
RVPI (Residual Value to Paid-In Capital)
The paper value of the unsold portfolio. If a startup raises a new round at a 10x higher valuation, the GP marks up their shares. RVPI represents this unrealized, highly illiquid paper wealth.
TVPI (Total Value to Paid-In Capital)
TVPI = DPI + RVPI. During years 4-7 of a fund, GPs heavily market their TVPI to raise their next vehicle. But historically, a massive percentage of RVPI never converts to DPI, as late-stage companies falter before IPO.