Private Equity & Exit Opps
Quick anchors: what IRR does doubling your money in 3, 4, and 5 years imply? And tripling in 5?
Model answer
Memorize these — they come up constantly: 2.0x in 3 years ≈ 26% IRR (2^(1/3) = 1.26); 2.0x in 4 years ≈ 19% (2^(1/4) = 1.19); 2.0x in 5 years ≈ 15% (2^(1/5) = 1.149). Tripling: 3.0x in 5 years ≈ 25%…
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