A

Additional Fees: The amount of capital not deemed as core management fees an investor pays into a fund/investment that does not count against the investor’s commitment.

Add-On/Bolt-On: When a private equity firm acquires a company to add onto an existing portfolio company. In add-on deals, the existing portfolio company is called the platform and the private equity firm is called the sponsor. Bolt-on is used more often in Europe.

Adjusted Market Value: An approximated Market Value that is adjusted forward incorporating additional cash flows since the last valuation date.

Agriculture: An investment strategy that invests in companies or assets involved in the production or distribution of agricultural products, such as crops, livestock, or aquaculture.

Alpha: Alpha refers to excess returns earned on an investment above the benchmark return. Active portfolio managers seek to generate alpha in diversified portfolios, with diversification intended to eliminate unsystematic risk.

Alternative Investment Vehicle ("AIV"): Many private equity fund agreements contain a provision permitting, or under certain circumstances requiring, the general partner to establish an “alternative investment vehicle,” commonly referred to as an AIV, that, for a variety of tax or regulatory reasons, will make a portfolio investment in lieu of the main fund.

As Of Date: A reference date to show the period of time through which cash flows and valuations are updated.

Asset Class: Major investment categories such as stocks or bonds, which are distinct from one another in terms of their main characteristics of risk, liquidity and return. In the Private Markets, the main asset classes are Private Equity, Private Credit, and Private Real Assets.

Assets Under Management ("AUM"): The total market value of the investments that a person or entity manages on behalf of clients.

B

Basis Points ("bps"): One hundredth of a percent (0.01%). Used to measure changes in or differences between yields or interest rates.

Benchmark: A point of reference against which performance is measured. The benchmark can be a comparison to the performance of other similar funds, a specific threshold return, or a public market index. 

Break-Even: The point when a company’s revenue equals its expenses.

Break-Up Fee: A fee paid by the seller if it breaches or decides to terminate a definitive acquisition agreement.

Bridge Loan: A temporary, limited amount of financing that serves as a "bridge" until a long-term debt or equity investment can be secured.

Brownfield: An investment in an existing asset, land or structure that typically requires repairs, upgrades and expansion.

Buyout: An investment strategy that makes control oriented equity investments.  Acquisitions are often made using a substantial amount of debt.

Back to top

C

Cap Rate: The rate of return on a real estate investment property based on the income that the property is expected to generate. Cap Rate = Net Operating Income (NOI) / Market Value.

Capital Assets: An investment strategy that invests in companies or assets involved in the production or distribution of natural resources, such as mining or energy infrastructure.

Capital Call/Drawdown/Paid In-Capital: A capital call, also known as a drawdown, is where the general partner (“GP”) of a fund calls on LPs to supply a portion of the amount of capital they committed at the beginning of the investment. The timing and amount are at the GP’s discretion, and once capital has been called, it is considered “paid-in capital.”

Capital Overhang/Dry Powder: Capital that has been committed to a General Partner but not yet invested. See also: Unfunded Commitment.

Capital Stack: The totality of capital invested in a project, including pure debt, hybrid debt, and equity. The stack is described as containing the most risk at the top, traveling down the stack to the position with the least risk. Higher positions in the stack expect higher returns for their capital because of the higher risk.

Carried Interest/Incentive Fee/ Performance Fee: A bonus entitlement accruing to an investment fund’s management company or individual members of the fund management team. Carried interest (typically up to 20% of the profits of the fund) becomes payable once the investors have achieved repayment of their original investment in the fund plus a defined hurdle rate. Carried interest is often also called an “incentive fee” or “performance fee".

Carveout: When a company sells all or part of its business.

Cash Drag: Cash drag is the result of a portfolio holding a portion of its assets in cash instead of higher returning assets.

Closed Fund: A fund that is no longer fundraising and is finished taking commitments from limited partners.

Closed-End Fund: A type of fund that has a fixed number of shares outstanding, which are offered during an initial subscription period, similar to an initial public offering. After the subscription period is closed, the shares are traded on an exchange between investors, like a regular stock. The market price of a closed-end fund fluctuates in response to investor demand as well as changes in the values of its holdings or its Net Asset Value. Unlike open-end mutual funds, closed-end funds do not stand ready to issue and redeem shares on a continuous basis.

Closing Date: The date a client closes into a fund or investment, also known as acquisition date or commitment date.

Co-Investment: A commitment to a new formed closed-end fund that invests in private assets alongside a lead general partner, often at a lower cost.

Co-Lead: Investment made directly in a company alongside a GP where the LP assumes a significant role in the diligence and negotiation of the deal.

Collar: A financial contract wherein the issuer guarantees a price range of the underlying security for a specific period of time in exchange for a sum ("premium"), often determined by a formula involving the volatility of the underlying security.  The buyer is obligated to deliver the underlying security if the price of the underlying security exceeds the upper bound.

Collateral: Assets pledged to a lender until a loan is repaid. If the borrower does not pay back the money owed, the lender has the legal right to seize the collateral and sell it to pay off the loan.

Commitment: An investor’s financial obligation to provide a set amount of capital to the investment.

Complex: Secondary transactions which are not standard LP-leds or GP-leds and typically feature a structural return component, through preference on cash flows, contractual returns or other.

Contribution: Capital contributed from an investor’s capital commitment to fund partnership investments, organizational expenses and management fees.

Contribution Pace: The portion of the unfunded commitment to a fund that is called each period. 

Core: An investment strategy involved in acquiring and owning high-quality, stabilized real estate assets with predictable cash flows and relatively low risk.

Core Infrastructure: An investment strategy involved in acquiring and owning high-quality, stabilized infrastructure assets with predictable cash flows and relatively low risk.

Core Plus: An investment strategy involved in acquiring and owning real estate assets with the potential for additional value creation through modest improvements or repositioning.

Core Plus Infrastructure: An investment strategy involved in acquiring and owning infrastructure assets with the potential for additional value creation through modest improvements or expansion.

Corporate Finance: See Buyout for more information.

Cost Basis: Summation of capital contributions less return of principal.

Co-Underwrite: Investment made directly in a company alongside the lead GP in which Hamilton Lane is brought into the process prior to the GP winning the deal.

Cumulative Contributions: The sum of all contributions made across a given period. 

Cumulative Distributions: The sum of all distributions made across a given period. 

Back to top

D

Deal IRR: The internal rate of return (IRR) for a single investment. Commonly shown as a gross IRR, which is the return before any management fees, carry or other related expenses are accounted for. See also "IRR".

Debt Ratios: Measures of leverage, financial strength or flexibility of a company.  The commonly used ratios are: debt-to-equity, debt-to-invested capital and debt-to-total capital.

Delayed Primary: A commitment to a newly formed closed-end private markets fund after the fund has deployed significant capital. Under 50% funded and invested at par (no discount to NAV).

Desmoothing: A mathematical process to remove serial autocorrelation in the return stream of assets that experience infrequent appraisal pricing, such as private equity. Desmoothed returns may more accurately capture volatility than reported returns. 

Direct Transaction: An investment directly in the equity or debt of a single company or asset, alongside a general partner. No fees or carry.

Distribution: Cash or stock distributed to the Limited Partners from a fund. Distributions can be recallable or non-recallable.

Distribution Pace: The portion of the unrealized value of a fund that is distributed each period. 

Distributions To Paid-In Capital (“DPI”): DPI is calculated by dividing the cumulative distributions an investor has received by the cumulative amount of paid-in capital.

Drawdown Rate: The speed at which a general partner calls down the capital committed by its limited partners.

Due Diligence: The vetting, analysing and assessing of individuals, companies and investors before engaging in a transaction.

Back to top

E

EBITDA: A company's earnings before interest, taxes, depreciation and amortization – a financial measure  that closely resembles cash operating income. It represents investment gains achieved by increasing the sales multiple relative to the original investment multiple.

End Market Value: The value of an investment at the end of the investment period. In private equity, it is the remaining equity that a limited partner has in a fund. 

Energy: An investment strategy that invests in companies or assets involved in the production or distribution of energy, such as oil, gas, or renewable energy.

Enterprise Value ("EV"): A company’s value calculated as market capitalization, including all debt and equity interests, minus excess cash.

Evergreen / Open-Ended Fund: A fund that never closes and keeps fundraising to ensure consistent cash flows.

Exit: Exit is the process of liquidating a private market position. There are several possible ways that a private market position can exit a portfolio, including but not limited to management buyout, initial public offering (IPO), SPAC, sale to strategic buyer or sale to financial buyer. 

Expansion Capital: Financing provided for the growth and expansion of a company, which may or may not break even or trade profitably. Capital may be used to: finance increased production capacity; market or product development; or provide additional working capital. Also called development capital. 

Back to top

F

Family Office: A firm that manages assets, investments and trusts for a wealthy family.

Final Close: The time at which a general partner stops fundraising for a fund.

First Close: The first date at which investors can commit capital to a fund. 

Float: The number of common shares that are freely tradable in the public market or markets on which a company’s securities are listed.

Fund: A private equity investment fund is a vehicle for enabling pooled investment by a number of investors in equity and equity-related securities of companies (investee companies). These are generally private companies whose shares are not quoted on any stock exchange. The fund can take the form either of a company or of an unincorporated arrangement such as a limited partnership.

Fund Age: The age of a fund in operations since the date of its first drawdown. Can be expressed in quarters or years.  See also Vintage Year.

Fund Focus: The strategy of specialization by examples such as stage of investment, sector of investment and geographical concentration. 

Fund Size: The total amount of capital committed by both the limited and general partners of a fund.

Fund-of-Funds: A commitment to a newly formed closed-end fund that invests in other primary private markets funds.

Fundraising: The process in which a private equity company, the general partner, raises money from investors, the limited partners, to create an investment fund.

Back to top

G

General Partner ("GP"): The General Partner is the manager of a private markets fund. These managers are in charge of calling and distributing capital to and from the Limited Partners (see “Limited Partner”) in the fund.

GP Led: Investment in an asset(s) led by a GP that is acquiring the asset(s) from another vehicle managed by the same GP.

GP Stakes: Direct equity investments representing a minority ownership position in a GP's underlying management company. 

Greenfield: An investment that involves an asset or structure that does not yet exist. Investors fund all stages of development, including design, construction, infrastructure and operations.   

Gross Performance: The performance of the General Partner’s vehicles that excludes of all fees, carried interest and expenses. Performance data is as reported by the General Partner, using actual capital contributions, distributions and net asset value for either all limited partners, or a sample set of limited partners, in the respective funds.

Growth Equity: An investment strategy that makes minority (does not usually result in change of control) equity investments in mature companies looking to expand operations.

Back to top

H

Hedge Fund: A pooled investment vehicle that utilizes diverse strategies, including leveraging or trading of non-traditional assets, and aims to protect against market movements regardless of market direction. Hedge Funds are structured as Open-Ended / Evergreen Primary Partnerships.

Horizon Model: The Horizon Model is Hamilton Lane’s proprietary modelling tool designed to forecast the expected cash flows and net asset value (NAV) growth of an investor’s existing private markets portfolio as well as planned future commitments. The model can also suggest a commitment plan to reach an investor’s target exposure to the private markets. Check out our white paper for more information. 

Back to top

I

Income: Income can refer to a company's remaining revenues after paying all expenses and taxes.  Income can be recallable or non-recallable.

Infrastructure: An investment strategy that invests in the construction, management, and/or ownership of large-scale projects that involve physical assets such as airports, highways, bridges, and energy facilities. These investments typically require large amounts of capital and involve long-term commitments.  Investments are often tied to the energy, transportation and utilities sector.

Infrastructure Debt: An investment strategy that lends to infrastructure operating companies, infrastructure projects, and / or provides asset backed loans collateralized by infrastructure assets.

Initial Public Offering ("IPO"): The first time a private company’s stock is available to the public. All companies undergoing an IPO must register with the SEC and take the necessary steps to comply with all applicable rules and regulations.

Internal Rate Of Return ("IRR"): The Internal rate of return (IRR) is the implied discount rate or effective compounded rate of return that equates the net present value of the partnership’s cash outflows with its inflows and residual value at the time of calculation. The Internal rate of return (IRR) is the implied discount rate or effective compounded rate of return that equates the net present value of the partnership’s cash outflows with its inflows and residual value at the time of calculation. 0 = NPV = Σ [CF_n ÷ (1 + IRR)^ n], where n is the number of periods.

Interquartile Range: The interquartile range is a measure of variability, based on dividing a data set into quartiles. Q1 is the "middle" value in the first half of the rank-ordered data set. Q2 is the median value in the set. Q3 is the "middle" value in the second half of the rank-ordered data set. The interquartile range is therefore equal to Q3 minus Q1. 

Invested Capital: The sum of all committed capital that has been drawn down by the fund for all the deals in the given range.  

Investment Advisor: An individual or an organization who provides investment advice for compensation.  Investment advisors that manage substantial assets must register with the SEC and comply with the Investment Advisers Act of 1940.

Back to top

J

J-Curve: A J-Curve refers to the typical pattern of return of closed-end private markets funds over their lifecycle. In the early years of a fund’s life, the internal rate of return (“IRR”) of a fund is typically negative due to the relatively small amount of invested capital as compared to the management fees that have been paid. The return, if graphed over time, resembles a “J,” as negative early performance turns increasingly positive over time as underlying investments within the portfolio begin to appreciate and generate a return. 

Junior Debt: A debt investment strategy that are subordinate in nature to other debt in the capital structure including second lien term loans, bonds, mezz and debt-like preferred equity.

Back to top

L

Late Stage: An investment strategy that provides capital to companies that are close to or have achieved profitability and are looking to scale operations.  These companies may be close to as an initial public offering (IPO) or acquisition by a larger acquirer. The focus is on providing the company with the necessary capital to achieve a successful exit.

Lead: Investment made directly in a company where the LP assumes primary responsibility for diligence and negotiation.

Limited Partner: Typically, a private equity fund is organized as a limited partnership.  The individuals and institutions who invest in the fund are limited partners in the limited partnerships.  Limited partners have limited liability and do not participate in the day-to-day management of the fund.

Liquidation Stage: Refers to the stage in the life of a fund in which, after expiration of the term of the fund, the remaining assets are sold to wind up the fund and distribute disposition proceeds to investors. During the liquidation stage, the corporate purpose of the fund changes to be focused solely on final termination of the fund.

Liquidity Ratio: The proportion of distributions over contributions, for the entire private markets on an annual basis.  

Loss Ratio: The proportion of investments or  invested capital that has a TVPI multiple below 1.0x.  Loss ratio can be calculated on a count basis or capital weighted basis.

LP Led: Purchase of a limited partner interest in an existing private markets fund or portfolio of funds.

Back to top

M

Management Fee: Compensation received by a private equity fund’s management firm. This annual management charge is equal to a certain percentage of investors’ initial commitments to the fund ranging between 0.5-3%. This can be called by the GP inside or outside of commitment.

Mergers And Acquisitions ("M&A"): A general term that describes the consolidation of companies or assets through various types of financial transactions, including mergers, acquisitions, consolidations, tender offers, purchase of assets and management acquisitions.

Mining & Minerals: An investment strategy that invests in companies or assets involved in the extraction or processing of minerals or other natural resources.

Multi Asset: Investment in a set of companies or assets led by a GP that is acquiring the assets from another vehicle managed by that GP.

Multi-Cap: A buyout fund is classified as Multi-Cap if it invests in a diversified portfolio of Buyout funds of varying sub-strategies. Should only be used for fund-of-funds and secondary fund-of-funds structure types.

Multi-Manager CI: An investment vehicle that invests directly in deals alongside a multiple general partners.

Multiple On Invested Capital ("MOIC"): The ratio of realized and unrealized capital relative to the capital invested. MOIC often returns to the multiple of return for individual deals. MOIC = Realized Value + Unrealized Value / Total Initial Investment. See also "TVPI" for a fund-level version of the definition.

Multi-Stage: An investment strategy that invests across multiple stages of a company's development, from seed/early stage to late stage (see other definitions).

Multi-Strategy: An investment that spans multiple private markets strategies.  Should only be used for fund-of-funds and secondary fund-of-funds structure types.

Multi-Strategy PC: An investment that spans multiple Private Credit strategies.  Should only be used for fund-of-funds and secondary fund-of-funds structure types.

Multi-Strategy PE: An investment that spans multiple Private Equity strategies.  Should only be used for fund-of-funds and secondary fund-of-funds structure types.

Multi-Strategy RA: An investment that spans multiple Private Real Assets strategies.  Should only be used for fund-of-funds and secondary fund-of-funds structure types.

Back to top

N

Natural Resources: An investment strategy that invests in the extraction or production of commodities, such as energy, minerals, timber, or agriculture.

Net Asset Value (“NAV”): The net asset value represents a fund’s market value. Net asset value is the value of a fund’s assets minus any liabilities and expenses.  Individual companies are valued and then aggregated to compute the fund’s value or portfolio’s value. 

Net Performance: The performance of the General Partner’s vehicles that is inclusive of all fees, carried interest and expenses.  Performance data is as reported by the General Partner, using actual capital contributions, distributions and net asset value for either all limited partners, or a sample set of limited partners, in the respective funds.

Net Present Value ("NPV"): NPV calculates the difference between the present value of cash inflows and the present value of cash outflows over a specific period. It helps determine if an investment will generate more value than its cost, considering the time value of money. 

Nominalized/Annualized IRR: Performance of an investment that is less than one year old. (Note:  Excel will automatically annualize an IRR when using the XIRR function).

Back to top

O

Open-Ended / Evergreen: A commitment to a private markets fund that allows for regular subscriptions and redemptions.

Opportunistic: An investment strategy involved in acquiring and owning real estate assets that require significant improvements or have complex ownership structures, with the aim of achieving higher returns through active management.

Opportunistic Debt: A debt-related investment strategy that capitalizes on unique situations such as market inefficiencies or temporary market dislocations.  Debt instruments vary and targets may include distressed debt, special situations, or sectors with favourable risk-return profiles.

Opportunistic Infrastructure: An investment strategy involved in acquiring and owning infrastructure assets that require significant improvements or have complex ownership structures, with the aim of achieving higher returns through active management.

Origination: An investment strategy primarily focused on providing debt capital directly to private companies, often secured by the company's assets. This typically includes credit stratagies with a focus on senior debt, mezzanine, real estate, and royalties.

Other Alternatives: Alternative investments such that the investing structure or investing strategy fits outside traditional drawdown funds in Private Equity, Private Credit, and Private Real Assets.

Ownership Percentage: The investor’s percent of ownership as measured by capital committed divided by fund size.

Back to top

P

Partnership Expenses: All fees, costs, expenses, liabilities and obligations relating to the Partnership and/or its activities, business, Portfolio Companies or actual or potential investments, including with respect to any Person formed to effect the acquisition and/or holding of a Portfolio Company (to the extent not borne or reimbursed by a Portfolio Company or potential Portfolio Company), including all fees, costs, expenses, liabilities and obligations. Can be called by the GP inside or outside of commitment.

Placement Agent: A third-party firm that helps general partners fundraise.

Pooled IRR: An IRR calculation which aggregates cash flows (paid-in capital and capital distributed) and the reported market values of each investment within a portfolio to create one return.

Portfolio: Purchase of multiple limited partner interests in existing private markets funds.

Portfolio Company: The company or entity into which a private equity fund invests directly.

Portfolio Holding Exposure: The limited partner's allocation to an underlying investment based on the ownership percentage of the partnership.

Preferred / Structured: Investment in a fund or company that has priority on distributions sent out by that fund or company.

Preferred Return/Hurdle Rate: The preferred return, also commonly referred to as the “hurdle rate,” is an annual return that limited partners are entitled to receive prior to the general partner receiving carried interest. In practice, it is a way to ensure limited partners make a profit before the GP earns their carried interest.

Pre-Seed: The stage before the seed stage. As seed-stage investing has become more popular, investors have started to invest in companies at this stage in the hopes of finding them early on. A pre-seed company is often just the founder(s) and an idea.

Primary Partnership: A commitment to a newly formed private markets fund.

Private Credit: "An investment strategy that extends (or purchases) loans, bonds, or other debt instruments of companies or tangible assets. Includes Origination, Structured Product, Specialty Financing and Opportunistic Debt sub-strategies."

Private Equity: An investment strategy that primarily invests in equity ownership private companies with the goal of generating high returns through operational improvements, financial engineering, or strategic acquisitions. Includes Buyout, Growth Equity, Venture Capital and GP Stakes sub-strategies.  

Private Placement Memorandum ("PPM"): Fund offering document, which outlines a sponsor’s proposal for investment opportunity.

Private Real Assets: Real Assets includes any private markets fund with a strategy of infrastructure, natural resources, or real estate.

Public Market Equivalent (“PME”): A Public Market Equivalent (PME) is a relevant public market benchmark whereby the IRR, or Internal Rate of Return, of a private market investment can be compared, assuming similar investment timeframes. PMEs are helpful to judge the opportunity cost of a private market investment relative to the equivalent strategy in the public markets. 

Back to top

R

Real Estate: An Investment strategy that makes investments in land and properties.

Real Estate Debt: An investment strategy that provides financing to real estate projects, often in the form of debt or debt-like securities.

Realized Gain/Loss: A realized gain results from selling an asset at a price higher than the original purchase price. It occurs when an asset is sold at a level that exceeds its book value cost. If selling an asset results in a loss, there is a realized loss instead.  Realized Gain/Loss can be recallable or non-recallable.

Realized Investments: Hamilton Lane classifies investments as ‘realized’ if it has i) an unrealized value of less than 20% of the total value; ii) a carrying value that has been written to zero or has been previously written-off; or iii) been fully exited and the GP has no remaining interest in the company.

Realized Multiple: See Distributions To Paid-In Capital (“DPI”) for more information.

Remaining NAV: The equity value remaining in the fund at the end of the reporting period. 

Reported Market Value: The investment’s capital account balance at quarter end.

Residual Value to Paid-In ("RVPI"): The investment's unrealized value relative to invested capital. RVPI = (Current Net Asset Value) / (Total Amount of Capital Paid-In).

Return On Investment ("ROI"): A calculation based on the total value (market value plus distributions) divided by paid-in capital for an investment.

Row Equity: Includes all buyout, growth, and venture capital-focused funds, with a geographic focus outside of North America and Western Europe.

Back to top

S

Schedule Of Investments ("SOI"): A listing that may include all portfolio companies within an individual fund or a list of funds within an investor's portfolio.

Secondary Direct: Investment directly in a portfolio company (or set of portfolio companies) purchased from existing shareholders.

Secondary Fund-of-Funds: A commitment to a newly formed closed-end fund that purchases interests in existing private markets funds and assets.

Secondary Transaction: Purchase of a limited partner interest in an existing private markets fund OR an investment into an asset(s) / fund(s) alongside a general partner (typically with fees & carry).

Seed / Early Stage: An investment strategy that provides capital to companies that are in the initial stages of development and have not yet generated significant revenue or established a track record of success. These investments are typically riskier than later stage investments, but also offer the potential for higher returns.  The focus is often on helping the company develop its initial product or service.

Senior Debt: A debt investment strategy that provides senior secured financing in the form of first lien or unitranche term loans. 

Separate Account: Client that has a customized investment portfolio that is managed by an outside party.

Sharpe Ratio: A measure of relative performance of investment managers, it is the excess return (above a risk free rate) of a portfolio divided by its standard deviation.

Simple-Dietz Time-Weighted Return: Time weighted return calculation, which assumes that all cash flows occur at the mid-point of the evaluation period. Simple Dietz Return = (Ending Value − Beginning Value − Cash Flows) / (Beginning Value + 1/2 × Cash Flows).

Single Asset: Investment in a single company or asset led by a GP that is acquiring the asset from another vehicle managed by that GP.

Single Fund: Purchase of a single limited partner interest in an existing private markets fund.

Single Manager CI: An investment vehicle that invests directly in deals alongside a single general partner.

Single Period Return: The total return received from an asset over a given period of time. 

Specialty Financing: An investment strategy that provides customized financing solutions to businesses that are unable to secure financing through traditional channels. This may include financing for specific projects, equipment / hard assets, inventory or royalties.

Strategic Origination: An investment strategy involved in sourcing and originating debt instruments across the capital structures which can include non-traditional or complex financing opportunities. 

Structured Product: An investment strategy involved in creating or investing in complex debt instruments, often with customized terms or structures including but not limited to JV partnerships, unique structured market opportunities and CLO strategies.

Subordinated Debt: Debt that ranks lower than other loans and will be paid last in the case of liquidation.

Back to top

T

Temporary Return Of Capital: Return of capital previously called for underlying fund investments, fees, or expenses that can be called by the GP again at a later time.

Timberland: An investment strategy involved in acquiring and owning forested land for the purpose of timber harvesting or other forest-related activities.

Time-Weighted Return: Time-weighted return is a measure of compound rate of growth in a portfolio.

Total Exposure: Calculated by the summation of market value and unfunded commitments. Total Exposure is equal to NAV + Unfunded Commitment.

Total Value: Equivalent to Market Value plus Capital Distributed.

Total Value To Paid In ("TVPI"): The sum of existing unrealized value in a fund plus distributions received to date over invested capital. TVPI = (Amount of Distributions Received + Current Net Asset Value) / (Total Amount of Capital Paid-In). See also Multiple On Invested Capital ("MOIC") for a deal-level version of the definition.

Traditional Primary: A commitment to a newly formed closed-end private markets fund at the time of the funds' inception.

Tranche: Tranches are segments of a pooled collection of assets that are split up by characteristics such as risk, strategy/asset class, or other client-specific distinguishing characteristics.

Back to top

U

Underwriter: An investment bank which helps a company to organize a share offering to potential investors. The investment banks issue debt and equity securities on behalf of corporations and governments to generate investment capital. The managing underwriter assists the company in preparation of the prospectus and roadshow, and organizes the syndicate of underwriters to sell the securities. 

Unfunded: Amount of committed capital that has not been drawn down by the fund.

Unicorn: A venture capital-backed company with a valuation of $1B or more.

Back to top

V

Value Add: An investment strategy involved in acquiring and owning real estate assets with the potential for significant value creation through renovation, redevelopment, or other improvements.

Value Add Infrastructure: An investment strategy involved in acquiring and owning infrastructure assets with the potential for significant value creation through renovation, redevelopment, or other improvements.

Venture Capital: An investment strategy that invests in young companies with high growth potential, typically in exchange for minority ownership stake and involvement in the company's management.

Vintage Year: The year in which a partnership makes its first capital call for an investment into a portfolio company/holding.

Volatility: Volatility is a statistical measure of dispersion of return, specifically standard deviation.

Back to top

W

Withholding Tax: A withholding tax, or a retention tax, is an income tax to be paid to the government by the payer of the income rather than by the recipient of the income. The tax is thus withheld or deducted from the income due to the recipient.

Write-Off: The write-down of a portfolio company’s value to zero, typically a realization of permanent impairment or failure of an investee company.

Back to top