Distributions to Paid-In (DPI)

Unlike IRR and the residual portion of TVPI, DPI cannot be manipulated by optimistic marks on unsold investments. It counts only cash that has actually left the fund and landed in LP accounts. This makes DPI the metric LPs trust most when evaluating a GP's track record — a fund can show a glittering paper IRR and high TVPI, but if its DPI is near zero, it hasn't returned a dime of real money. 'DPI is the new IRR' became a refrain among LPs after years of distribution-light, mark-rich vintages.

Early in a fund's life DPI is ~0 — capital is being called and invested, not returned, which is the bottom of the J-curve. DPI rises as the fund exits investments. Crossing DPI = 1.0x is a key milestone: the fund has returned all the capital LPs paid in, so everything beyond is realized profit (LPs are 'in the money' on a cash basis). A mature, successful fund might finish at a DPI of 1.8x-2.5x+, meaning LPs received $1.80-$2.50 of cash for every dollar contributed.

These three multiples relate cleanly: TVPI = DPI + RVPI, where RVPI (Residual Value to Paid-In) is the unrealized, still-held value per dollar paid in. DPI is the realized cash portion; RVPI is the paper portion. A young fund's TVPI is mostly RVPI; a fully harvested fund's TVPI is essentially all DPI (RVPI → 0). Comparing DPI to TVPI tells you how much of a fund's reported value is real versus still riding on portfolio marks — a critical diligence check on a GP.