Money on Invested Capital (MOIC)

Also called MOIC

MOIC refers to the absolute dollar gain of an investment, irrespective of time.

The formula is:

Dollars at Exit / Dollars at Entrance

If you bought a business for $100 and sold it for $200, you would have a 2.0x MOIC regardless of how long that took.

Most PE firms look for a 3.0x MOIC within 5 years to attain a roughly 23% IRR.

In the room

MOIC and IRR come as a pair in interviews. MOIC tells you how many times your money came back; it ignores time entirely, which is exactly why it's never quoted alone.