IRR (Internal Rate of Return)

IRR (internal rate of return) is an annualized return measure based on the size and timing of contributions, distributions, and any remaining value. An interim IRR includes estimates for unrealized investments and can change as exits occur.

Example: With a single contribution on day one and a single distribution six years later, a 3.0x return implies about 20% annually. Capital calls over time require a cash-flow calculation.