What Is RVPI?
Residual value to paid-in capital measures the value still sitting inside a private fund relative to what investors have contributed. The numerator is the fund's reported net asset value, meaning the GP's fair-value estimate of every unsold position, and the denominator is cumulative paid-in capital. An RVPI of 0.9x means the remaining portfolio is marked at 90 cents for every dollar LPs have put in.
RVPI is inherently an estimate. Under US GAAP fair-value rules, GPs mark portfolio companies quarterly using approaches such as comparable company multiples and recent transaction prices, but the figures are unavoidably judgment-driven until an actual sale occurs. That makes RVPI the softest of the three standard multiples, and experienced LPs discount it accordingly when evaluating interim performance.
How It Fits with DPI and TVPI
The three multiples form a simple identity: TVPI = DPI + RVPI. A fund that has distributed $400 million and holds $500 million of remaining NAV against $600 million paid in shows a DPI of 0.67x and an RVPI of 0.83x, which sum to a 1.5x TVPI. Watching how the mix shifts over time reveals a fund's maturity: young funds are nearly all RVPI, while fully liquidated funds have an RVPI of zero.
The trajectory matters as much as the level. If RVPI stays high year after year without converting into DPI, it can signal a stale portfolio the GP cannot exit at its marks, or valuations that will not survive contact with real buyers. Conversely, a fund whose exits consistently come in above the marks embedded in RVPI builds credibility for the manager's valuation discipline.
Why It Matters
RVPI is where the debate over private fund performance lives. Because interim returns depend on GP marks, LPs scrutinize RVPI when deciding whether to re-up into a manager's next fund, often asking how prior marks compared with eventual exit prices. Secondary buyers also anchor on RVPI, since purchasing an LP stake is essentially buying the residual value at some discount or premium to NAV.
For interview preparation, be able to place RVPI inside the TVPI identity and to explain the realized-versus-unrealized distinction it captures. A sharp answer notes that two funds with identical TVPIs can carry very different risk profiles depending on how much of the multiple is still residual value rather than distributed cash.
