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DPI (Distributions to Paid-In)

Quick Definition

A fund performance metric showing actual cash returned to investors relative to invested capital.

What is DPI?

DPI measures real, realized returns. It's actual cash distributed back to LPs divided by capital they invested. A DPI of 1.0x means investors got their money back. Above 1.0x means profit.

Why DPI Matters

Unlike TVPI, DPI is real money. Paper gains can evaporate, but distributions are permanent. Experienced LPs focus heavily on DPI, especially for mature funds. It's the ultimate scorecard.

DPI Timeline

Early funds have low DPI (few exits). Mature funds (8-12 years) should show meaningful DPI. A 10-year fund with low DPI raises questions about exit ability.

Formula

DPI = Total Distributions / Paid-In Capital

Example:

  • $100M fund, $95M called
  • $150M distributed
  • DPI = $150M / $95M = 1.58x
Example

Fund performance at year 8:

  • Capital called: $100M
  • Distributed: $180M
  • Remaining portfolio: $50M

DPI = $180M / $100M = 1.8x (real returns)

RVPI = $50M / $100M = 0.5x (paper value)

TVPI = 1.8x + 0.5x = 2.3x

LPs have 1.8x their money back, with potential for more.

Related

Related Terms

Most Favored Nation (MFN)

A provision guaranteeing an investor will receive terms at least as favorable as any subsequent investor receives.

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Qualified Financing

The minimum raise amount that triggers automatic conversion of convertible notes or SAFEs.

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Maturity Date

The deadline by which a convertible note must be repaid or converted to equity.

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