Understanding Private-Market Metrics: NAV, MOIC, DPI, TVPI and IRR Explained

Net Asset Value (NAV) is the market value of all assets in a portfolio or fund, minus all liabilities, at a specific reference date. For a real estate investment, it simplifies to the property value (determined by appraisal or transaction) minus outstanding debt financing. NAV is a balance-sheet snapshot: it says what an investment is worth today — but it says nothing about how much capital was deployed or when cash flows occurred.

The weakness of NAV lies in its subjectivity: the underlying valuation depends on assumptions about market rents, discount rates and capitalisation factors. In illiquid private markets, a real estate value is not confirmed by the market daily but estimated periodically. Two appraisers may value the same building 10–20% differently without either being technically wrong. NAV is useful as a snapshot, but it is not a promise of what a sale will actually achieve.

An illustrative example — purely for conceptual understanding, not an OwnMore figure: a residential building has an appraised value of CHF 4.0m and carries a mortgage of CHF 2.4m. The NAV of the stake is CHF 1.6m. If the appraisal rises to CHF 4.5m (higher rents, lower capitalisation rate), the NAV grows to CHF 2.1m — without a single franc changing hands. This is why NAV alone does not constitute a complete return statement.

Multiple on Invested Capital (MOIC) answers a simple question: how much total value has been created per franc invested? The formula is: MOIC = (distributions + current residual value) / invested capital. A MOIC of 1.8× means that for every franc invested, a total of CHF 1.80 in value exists — regardless of whether that money has already been distributed or still sits in the portfolio. MOIC is deliberately simple: it ignores the time dimension entirely.

This simplicity is simultaneously its strength and its weakness. As a strength: MOIC is immediately understandable and allows direct comparison between deals of different structure and complexity. As a weakness: a MOIC of 2.0× looks identical whether the investor doubled their money in 18 months or in 12 years. Over 18 months that implies an annualised return of roughly 63%; over 12 years approximately 6%. MOIC says nothing about the quality of the waiting time.

In private-market jargon, MOIC is often called the "gross multiple" or "total value multiple". When comparing figures, it is important to clarify whether the MOIC is calculated before or after management fees and carried interest — the difference between gross MOIC and net MOIC can be material.

DPI (Distributed to Paid-In), RVPI (Residual Value to Paid-In) and TVPI (Total Value to Paid-In) are three sides of the same calculation. Together they describe where invested capital stands: how much has already been returned (DPI)? How much remains in the portfolio (RVPI)? And what is the total (TVPI = DPI + RVPI)?

The formulas: DPI = total distributions / invested capital. RVPI = current NAV / invested capital. TVPI = DPI + RVPI. A TVPI of 1.5× with a DPI of 0.3× and an RVPI of 1.2× says: 30 cents per franc invested have been distributed; CHF 1.20 per franc remains as book value in the portfolio. This is fundamentally different from a TVPI of 1.5× with DPI 1.5× and RVPI 0.0×, where everything has already been realised and paid out.

DPI is often the hardest of the three metrics: it measures only already-realised, actually paid-out value. A high RVPI, by contrast, is based on an estimate (NAV appraisal) and carries the risk that book value may not be achieved upon realisation. For institutional investors, a high DPI is therefore a stronger signal than a high RVPI — even though in the early phase of a real estate project little capital can naturally have been distributed yet.

The Internal Rate of Return (IRR) is the discount rate at which the net present value (NPV) of all cash flows — investments and distributions — equals zero. Simply put: IRR is the annualised return that explains when and how much capital was deployed and returned. Unlike MOIC, IRR takes into account the timing of every cash flow — earlier capital returned raises the IRR; delayed capital lowers it.

The most important pitfall: IRR implicitly assumes that all interim distributions can be reinvested at the same IRR rate. In practice this is rarely achievable — especially at high IRR levels. An investment with a calculated IRR of 25% assumes every distribution can also be reinvested at 25% per annum, which is unrealistic. The "Modified IRR" (MIRR) corrects for this effect but is communicated less frequently.

A further problem is sensitivity to exit timing: a short holding period can mathematically inflate the IRR even when the absolute gain (MOIC) is low. An example purely for understanding the concept: investing CHF 100 and receiving CHF 110 back after 6 months yields a MOIC of 1.1× — but on an annualised basis an IRR of approximately 21%. Letting the same CHF 100 grow to 1.8× over 5 years produces a higher MOIC but a lower IRR of approximately 12.5% per annum. Which investment is better depends on reinvestment opportunities, not on any single metric.

Each of the metrics discussed answers a different question — and none answers all questions. NAV gives today's value but carries appraisal risk. MOIC shows the absolute return multiple but ignores time. DPI measures hard, realised value but says nothing about the quality of the remaining portfolio. TVPI combines realised and unrealised value, but can therefore mislead when RVPI is soft. IRR accounts for time value but overstates reinvestment capacity.

In practice, professional private-market managers therefore always present a set of metrics: MOIC and IRR together give a two-dimensional view (multiple and speed); DPI alongside TVPI separates realised from unrealised value; NAV evolution over time shows valuation changes. Investors who see only one metric should ask why the others are absent.

A frequently overlooked dimension is the difference between gross and net metrics: gross IRR and gross MOIC are calculated before management fees, carried interest and fund costs. Net IRR and net MOIC show what actually accrued to the investor. The difference can be material depending on fund structure. When comparing offerings, it is therefore always necessary to clarify which basis is being used.

OwnMore is a real estate and private-market investment execution platform (BloomDigital GmbH, Switzerland). The platform is pre-launch: there is no track record, no closed transactions, and no historical IRR, MOIC or NAV data that OwnMore could communicate as proprietary performance. OwnMore publishes no AUM figures, no return promises and no benchmark comparisons. This transparency about maturity is a deliberate standard.

What OwnMore does disclose: the structure of a deal (capital stack, term, minimum ticket), the documented facts of an opportunity (appraised values, rental income, metrics from audited documents), and the mechanics of the platform (SHA-256 audit chain, custody being onboarded, FinSA eligibility verification). None of these disclosures is a return projection — they are structural facts that enable qualified investors to form their own assessment.

The metrics explained in this article (NAV, MOIC, DPI, RVPI, TVPI, IRR) are general private-market finance concepts. They are not OwnMore-specific and do not constitute investment advice. All numerical examples used in this article are purely hypothetical and illustrative — they are not projections, targets or results of OwnMore or any third party.