MOIC (Multiple on Invested Capital)

MOIC measures the total return on a litigation investment expressed as a ratio of total proceeds received to total capital invested, without adjustment for the time value of money. A 3.0x MOIC on a $5 million investment means the funder recovered $15 million in aggregate from that position. MOIC is a useful gross return metric for comparing outcomes across cases of different sizes, but it is incomplete for fund-level performance assessment because a 3.0x returned in 18 months is far superior to the same multiple returned in six years. Funders typically report both MOIC and IRR to limited partners, with MOIC useful for assessing the magnitude of a return and IRR capturing the time-adjusted performance.

Funders use MOIC to compare gross outcomes across cases of very different sizes on a common scale, but they never rely on it alone for portfolio-level decisions, since a high MOIC realized over many years can be a worse capital allocation than a lower MOIC realized quickly. Fund managers report MOIC alongside IRR specifically because LPs use the pairing to distinguish a genuinely strong investment from one that simply took an unusually long time to resolve.