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Private Markets (VC, PE, M&A) terms
Deal data: venture, private equity, M&A, valuations and exits.
Capitalization rate (cap rate) The ratio of a property's annual net operating income to its current market value, used to compare income-property returns. Discounted cash flow (DCF) A valuation method estimating an asset's worth as the present value of its expected future cash flows. Internal rate of return (IRR) The discount rate at which an investment's projected cash flows have a net present value of zero. Multiple on invested capital (MOIC) The total value a private investment has returned, divided by the total capital invested, without adjusting for the time it took. Public market equivalent (PME) A method comparing a private fund's returns to what the same cash flows would have earned invested in a public market index. Total value to paid-in (TVPI) A private fund performance ratio, total value returned plus unrealized value, divided by capital investors have actually paid in.