Total value to paid-in capital
What is Total value to paid-in capital?
Total value to paid-in capital, or TVPI, equals cumulative distributions plus residual fund value divided by cumulative paid-in capital.
TVPI should reconcile exactly to DPI plus RVPI under aligned definitions, currency, and date. Differences indicate data mapping, recallable distribution, or denominator issues. Historical charts should preserve each period's reported NAV and later restatements rather than replacing the entire series invisibly.
Unrealized value can dominate early and midlife results, making valuation quality central to interpretation.
Performance review should decompose change into calls, distributions, operating movement, market multiple, currency, fees, carry, and valuation adjustments. This helps distinguish genuine underlying value creation from capital flows and later formally reported valuation mark changes.
Formula
TVPI equals DPI plus RVPI when all three use the same paid-in denominator, date, currency, and definitions. A TVPI of 1.5x means distributed and remaining value together equal one and a half times contributed capital. It does not mean the investor has realized a 50% profit in cash.
Realized and unrealized components
DPI measures distributed value and RVPI residual value. Early funds often have low DPI and high RVPI; mature funds should shift toward realization. Two funds with equal TVPI can have very different cash returned, valuation uncertainty, duration, and liquidity. The composition is as important as the headline total.
Relationship to return
TVPI ignores timing, so funds reaching the same multiple over different periods have different annualized results. IRR includes timing but can favor early cash and financing. Use both. Public-market equivalent can add opportunity-cost context. None alone captures leverage, risk, strategy, or quality of remaining assets.
Valuation sensitivity
Residual NAV is manager-estimated and can be stale or model-based. TVPI can change through operating performance, exits, market multiples, currency, and valuation policy. Subscription facilities change call timing and IRR more directly but financing costs can reduce TVPI. Compare audited and subsequent realization evidence.
Practical reporting
Reconcile paid-in, distributions, NAV, recallable amounts, transfers, fees, and carry. State gross or net and as-of date. Do not average fund TVPIs without capital weighting or compare vintages as if equally mature. Show DPI, RVPI, IRR, commitment, unfunded amount, and valuation quality alongside TVPI.
Also known as: TVPI
Sources and further reading
- ILPA Reporting Template, Institutional Limited Partners Association
- Investments in Private Capital: Equity and Debt, CFA Institute