Metrics & Performance
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Quick Answer
Residual Value to Paid-In — the unrealized (paper) value of a fund's remaining portfolio relative to capital contributed. RVPI = TVPI minus DPI.
Residual Value to Paid-In Capital
RVPI = Residual Value / Paid-In Capital
Where
RVPI (Residual Value to Paid-In) measures the unrealized value of a fund's remaining portfolio companies relative to the total capital LPs have contributed. Formula: RVPI = Residual Value / Paid-In Capital, or equivalently: RVPI = TVPI - DPI. An RVPI of 1.5x means the fund's unrealized portfolio is currently marked at 1.5 times the total capital invested. RVPI is the 'paper gains' metric — it reflects the GP's assessment of what remaining companies are worth, but this value hasn't been proven by actual exits. RVPI is highest in a fund's middle years (years 3-7) when investments have been marked up but not yet exited, and should decline toward zero as the fund matures and exits positions.
Why It Matters
RVPI helps LPs understand how much of a fund's reported value is still unrealized and therefore uncertain. A fund with high TVPI but high RVPI (most value on paper) is riskier than a fund with the same TVPI but high DPI (most value in cash). Savvy LPs discount RVPI based on the GP's historical accuracy of portfolio markups — some GPs consistently convert RVPI into DPI, others see it evaporate in downturns.
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This concept is especially relevant for these venture capital roles:
RVPI (Residual Value to Paid-In) measures the unrealized value of a fund's remaining portfolio companies relative to the total capital LPs have contributed. Formula: RVPI = Residual Value / Paid-In Capital, or equivalently: RVPI = TVPI - DPI. An RVPI of 1.
Understanding RVPI is critical for founders navigating the fundraising process. It directly impacts deal terms, valuation, and the relationship between founders and investors.
RVPI falls under the metrics category in venture capital. This area covers concepts related to the quantitative measures used to evaluate fund and company performance.
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