Residual value to paid-in
The value of what a fund still holds, divided by capital paid in.
It is the unrealised part of TVPI. A high RVPI with a low DPI means most of the return still depends on valuations.
RVPI falls as the fund sells investments and rises or falls with valuations of what remains. Late in a fund's life, a high RVPI can mean exits have been slow or that the remaining assets need more time.
Because RVPI depends on the manager's valuations, LPs look at valuation policy, the use of third-party valuations and how marks compare with recent funding rounds or comparable public companies.
Worked example
LPs have paid in $40M and the fund's remaining investments are valued at $44M. RVPI is $44M divided by $40M, or 1.1x. If the fund then sells a company for $15M that was valued at $12M, RVPI falls to $32M divided by $40M, or 0.8x, while DPI rises.
Common questions about RVPI
What does a high RVPI mean?
That most of the fund's value is still unrealised and depends on current valuations. It is normal early in a fund's life and a question mark late in it.
How do DPI, RVPI and TVPI relate?
TVPI is the sum of DPI and RVPI. DPI is cash already returned, RVPI is the value still held, and both are divided by capital paid in.