MOIC to IRR calculator
Convert MOIC and holding period to annualized IRR, or find MOIC from an annual return. Assumes one investment and one exit receipt, with no interim cash flows.
Result
Annualized IRR
14.87%
- MOIC
- 2.00x
- Total return
- 100.00%
- Holding period
- 5.00 years
One entry outflow and one exit inflow.
How to convert MOIC to IRR
MOIC compares total investment value with the capital invested, without accounting for how long it took. For this tool, divide the single cash receipt at exit by the initial investment. Under the entry-to-exit assumption, IRR is the annual compounding rate that turns the initial investment into the exit value. Invest Europe defines MOIC and IRR in its reporting guidelines.
IRR = MOIC^(1 / years) − 1
The relationship is MOIC = (1 + IRR)^years. Take the root for the number of years, then subtract 1 to remove the starting capital. Multiply the result by 100 to express it as a percentage.
For the inverse, use MOIC = (1 + IRR)^years with IRR as a decimal. At 20% IRR for five years, 1.20^5 = 2.48832x, displayed as 2.49x. Enter 20 in the calculator’s IRR (%) field.
Annualized IRR versus total return
Total return is (MOIC − 1) × 100%: 2.0x means a 100% total gain. Annualized IRR includes the holding period. The same 2.0x is 25.99% per year over three years, 14.87% over five, and 10.41% over seven. Dividing the total gain by the number of years does not account for compounding.
Worked examples
Double your money over five years
2^(1 / 5) − 1 = 14.87%
$100 invested and $200 returned at exit gives 2.0x MOIC and 100% total return. The annualized IRR is 14.87%, because the annual rate compounds for five years.
Triple your money over five years
3^(1 / 5) − 1 = 24.57%
$100 invested and $300 returned at exit gives 3.0x MOIC and 200% total return. Dividing 200% by five would give 40%, which ignores compounding.
Use a fractional holding period
2.5^(1 / 4.5) − 1 = 22.58%
$100 invested and $250 returned after 4.5 years gives 2.5x MOIC, 150% total return, and 22.58% annualized IRR. You can enter decimal years without rounding the hold to a whole year.
Check a loss scenario
0.8^(1 / 3) − 1 = −7.17%
$100 invested and $80 returned after three years gives 0.8x MOIC and a 20% total loss. The annualized IRR is −7.17%; a positive multiple below 1.0x produces a negative annual return.
MOIC to IRR reference table
| MOIC | 3 years | 5 years | 7 years |
|---|---|---|---|
| 1.5x | 14.47% | 8.45% | 5.96% |
| 2.0x | 25.99% | 14.87% | 10.41% |
| 2.5x | 35.72% | 20.11% | 13.99% |
| 3.0x | 44.22% | 24.57% | 16.99% |
| 4.0x | 58.74% | 31.95% | 21.90% |
Assumptions and limits
- No interim cash flows. Dividends, distributions, follow-on investments, and recapitalizations change cash-flow timing. MOIC and years alone cannot determine their IRR. Use the full cash-flow schedule and an IRR or dated XIRR calculation instead. Microsoft’s IRR documentation explains the cash-flow inputs.
- Positive MOIC and years. Below 1.0x, the result is a loss; 1.0x gives 0% IRR. A 0x total loss has no finite conventional IRR because there is no positive return cash flow. The calculator rejects 0x, negative multiples, and zero or negative holding periods.
- Consistent inputs. Use the same investment scope and currency for entry and exit. Fees, taxes, leverage, and inflation are not added automatically; the result reflects the values you enter.
- Rounding. IRR, total return, and inverse MOIC normally display to two decimal places. Very small nonzero values and rates near −100% use inequalities to avoid displaying a false zero or total loss; very large values use scientific notation with three significant figures. Calculations use the unrounded inputs. Displayed precision is a calculation convention, not a forecast of investment performance; extreme results may exceed the calculator’s numerical range.
Use the answer in a finance case
Check sponsor returns in a paper LBO, then compare the exact answer with a mental estimate. Wall St Math trains the arithmetic behind the case.
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Method checked by WSM Editorial on October 2, 2026. About our editorial approach.