IRR and MOIC Calculator
Enter the equity you invest today and the cash that comes back each year, including the sale in the final year. The IRR is the annual return that makes those cash flows net to zero; the MOIC is simply what comes back divided by what went in.
Inputs
Results
- IRR
- 14.37%
- MOIC
- 1.85x
- Total profit
- $8,500,000
How it's calculated
| Result | Formula |
|---|---|
| IRR | =IRR(cash flows, Yr 0 to the last year) |
| MOIC | =SUM(cash back) / equity invested |
| Total profit | =SUM(cash back) − equity invested |
IRR rewards speed: the same 1.85x multiple is a much higher IRR over three years than over seven. MOIC ignores time entirely, which is why investors quote both.
Most private equity and value-add real estate deals target IRRs in the high teens to low twenties; core real estate targets far less. A strong IRR on a small multiple usually means a quick flip with little profit in dollars.
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Build the cash flows behind an IRR, from rent and debt to the sale, and get every cell graded.
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What is a good IRR?
It depends on the risk. Core real estate often targets 6 to 9%, value-add 13 to 18%, and private equity buyouts around 20%. Compare an IRR with the multiple and the hold period, not on its own.
What's the difference between IRR and MOIC?
MOIC is total cash back divided by cash in, with no regard for time. IRR is the annualized return, so it rises when the same cash comes back sooner.
How do I calculate IRR in Excel?
Put the equity invested as a negative number in the first cell and each year's cash back in the cells after it, then use =IRR(range). For uneven dates, use =XIRR(values, dates).
Why does my IRR come back blank?
IRR needs at least one negative and one positive cash flow. If every cash flow has the same sign, no rate solves it.