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What is Multiple on Invested Capital?

Definition

Multiple on Invested Capital

Multiple on Invested Capital (MOIC) is a performance metric that compares the total value of an investment (realized returns + current value) to the initial cost of the investment.

Why It Matters for Startups

Directly dictates the cap table and dilution structure during fundraising; understanding Multiple on Invested Capital helps founders model equity distributions when structuring rounds for individual startup investment performance tracking.

Detailed Deep Dive

Multiple on Invested Capital (MOIC) is a performance metric that compares the total value of an investment (realized returns + current value) to the initial cost of the investment.

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Frequently Asked Questions

Q:How is MOIC calculated?

MOIC = (Realized Value + Unrealized Value) / Capital Invested.

Q:How does MOIC differ from IRR?

MOIC measures total return multiple without factoring in time, while IRR calculates the annualized rate of return over time.

Quick Facts

  • CategoryMetrics
  • Key ApplicationIndividual startup investment performance tracking

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[Multiple on Invested Capital | SPIDITS Glossary](https://spidits.com/startup-glossary/moic)

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