← Back to Tools
IRR / MOIC Converter
Instantly convert between absolute cash multiples (MOIC) and annualized time-weighted returns (IRR).
MOIC
Multiple on Invested Capital
IRR
Internal Rate of Return
The Math
MOIC (Multiple on Invested Capital) is a measure of absolute cash returned. It ignores the time value of money.
MOIC = Exit Value / Entry Value
IRR (Internal Rate of Return) is a time-weighted return metric. It is the discount rate that makes the net present value of all cash flows equal to zero.
IRR = (MOIC ^ (1 / Years)) - 1
Note: A fast hold period (e.g., 2 years) can generate a massive IRR even if the MOIC is relatively low. PE funds optimize for IRR to cross hurdle rates, but you can't eat IRR; absolute cash (MOIC) pays the bills.