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IRR & Equity Multiple Calculator

Enter the contributions and distributions for each period. The calculator returns the annualized IRR, the equity multiple, total profit, and the average cash-on-cash return, and tells you when an IRR can’t be calculated.

Cash Flows

Period Length
The IRR is annualized either way.
Contributions and Distributions

Enter contributions as negative amounts and distributions as positive amounts. Year 0 is the initial investment; include sale proceeds in the final year.

Results

IRR (Annualized)
13.05%
Equity Multiple
1.75x
Total Profit
$75,000$175,000 distributed on $100,000 contributed
Average Cash-on-Cash
6.75%Per year, excluding the final year

How IRR and Equity Multiple Are Calculated

  • IRR is the rate r per period where the cash flows net to zero: the sum of each cash flow ÷ (1 + r)t equals 0, with t counting periods from 0. For quarterly or monthly rows, the annualized IRR is (1 + r)4 − 1 or (1 + r)12 − 1.
  • Equity multiple is total distributions ÷ total contributions. It ignores timing.
  • Total profit is total distributions minus total contributions.
  • Average cash-on-cash is the average distribution per year, as a share of contributions, across every period except the first and the last. The last period usually includes sale or refinance proceeds, which would overstate the yield.

A Worked Example

An investor contributes $100,000, receives $6,000, $6,500, $7,000, $7,500 in Years 1 to 4, and $148,000 in Year 5 including their share of the sale. They get back $175,000: $75,000 of profit, a 1.75x equity multiple, a 13.05% IRR, and an average cash-on-cash return of 6.75%.

Now delay every distribution by two years. The investor still gets $175,000 back and the multiple is still 1.75x, but the IRR falls to 8.87%. That is why investor reports usually show both numbers. Our guide to IRR vs. equity multiple covers how to label them in a statement.

When an IRR Can’t Be Calculated

An IRR needs at least one contribution and one distribution. If every amount has the same sign, no rate can make them net to zero, and the calculator says so rather than showing 0%.

Cash flows that change sign more than once, such as a contribution, a distribution, then a second capital call, can have more than one IRR. For example, −$100,000, then $230,000, then −$132,000 nets to zero at both 10% and 20%. Neither rate is “the” return, so the calculator reports it as unavailable. Use the equity multiple, or a modified IRR with stated reinvestment and finance rates.

What This Calculator Doesn’t Do

  • Rows are evenly spaced. For irregular dates, use an XIRR calculation on the actual dates, which is what investor statements should use.
  • It doesn’t separate gross and net returns. Enter the cash flows the investor actually received, after fees and promote, for a net figure.
  • Results are an illustration, not investment, legal, or tax advice.

How This Compares with Syndelo

Syndelo’s investor reporting reports supported IRR and multiple metrics from dated activity and the valuation inputs you provide, and keeps an unavailable result distinct from zero.

Common Questions

What is the difference between IRR and equity multiple?

The equity multiple compares total distributions with total contributions and ignores timing. IRR is the annual rate at which the contributions and distributions net to zero, so it rewards getting cash back sooner. Two deals with the same 1.5x multiple can have very different IRRs.

Why does the calculator say the IRR is unavailable?

An IRR exists only when the cash flows include at least one contribution and one distribution. When they change sign more than once, for example a second capital call after distributions, there can be two or more rates that work. In both cases the calculator shows the reason instead of a misleading number.

How is the IRR annualized for quarterly or monthly cash flows?

The calculator solves for the rate per period, then compounds it: (1 + periodic rate) raised to the number of periods in a year, minus 1. A 2% quarterly IRR is about 8.24% a year.

Is this the same as Excel’s IRR or XIRR?

It matches Excel’s IRR for evenly spaced periods. XIRR uses the actual date of each cash flow, so it can differ when payments are irregular. Use dated cash flows for investor reporting.

What is cash-on-cash return?

Cash-on-cash return is the cash distributed in a year divided by the equity invested. The calculator averages it across every period except the last, because the final period usually includes sale or refinance proceeds.

Related

IRR vs. Equity Multiple: A Reporting Guide for SponsorsDistribution Waterfall CalculatorA Quarterly Investor Reporting ChecklistInvestor Reporting SoftwareAll Free Calculators

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