The measurement Multiple of Money is used to calculate growth, Mom is a metric for measuring the return on investment as well as tracking the performance of a fund. It is a metric that compares the amount of equity taken out on the exit date in comparison to the initial starting equity contribution.
To find and calculate the Multiple of Money, use the formula total cash inflows divided by total cash outflows. If you have the value for Multiple of Money (MoM) you can also calculate the Internal Rate of Return (IRR). The fromula used to find IRR from the value of MoM is:
Internal Rate of Return (IRR) = Multiple of Money (MoM) ^ (1 / Number of Periods) – 1« Back to Glossary Index