Deal Returns Calculator

The four metrics that define a deal's performance are cash-on-cash return, equity multiple, IRR, and total profit. Each tells you something different. Cash-on-cash measures annual yield on invested equity. Equity multiple tells you how many times you get your money back over the hold period. IRR accounts for the time value of money, weighting earlier cash flows more heavily. Total profit is the simplest: what you walk away with after selling and paying off debt.

No single metric tells the full story. A deal with a 2.5x equity multiple over 10 years is different from a 2.5x over 3 years. A high IRR on a small equity check may produce less actual profit than a moderate IRR on a larger investment. Sophisticated teams evaluate all four together.

Running returns in a standalone spreadsheet works for one deal at a time. But when you are evaluating 15 deals in your pipeline, each at different stages with different assumptions, those spreadsheets become disconnected snapshots that nobody trusts. When the GP asks "which deal in our pipeline has the highest projected IRR?" and the answer requires opening six files, the problem is not the math. The problem is where the math lives.