Reading a fund report

What's in a venture fund report?

Usually a letter from the manager, a schedule of the portfolio companies, the fund's performance numbers and a capital statement, for the fund as a whole or for each investor. Once a year the fund adds audited accounts and a tax statement.

Formats vary. The Institutional Limited Partners Association (ILPA) publishes voluntary templates for reporting fees, expenses, carry and performance, updated in January 2025, and many smaller managers use their own format.5 Click a number in the mock report below, or take the tour.

What does a capital account statement show?

Your client's committed, paid-in, returned and remaining capital, as on page 2 of the report above. It should roll forward: the opening balance matches last quarter's closing and the lines add down to the new closing NAV. Some managers put a fund-level statement in the quarterly report and send each investor's capital account on request. Keep it on file, since your client's records and tax work should tie back to it.

What do DPI, TVPI and IRR mean?

DPI is cash paid back over capital paid in, TVPI adds NAV to the cash paid back, and IRR is the annualised return on the dated cash flows; page 1 of the report shows all three. If a figure doesn't say whether it's net of fees, costs and carry, ask.

Early IRR mostly reflects a few recent markups, and subscription lines (short-term borrowing to invest before calling capital) lift it further. ILPA cites a Cobalt analysis of 498 funds in which delaying calls by up to a year lifted median IRR by 2.06 percentage points by year three for funds above 1× TVPI, shrinking to 0.35 to 0.45 points by the end of the fund's life. ILPA recommends reporting net IRR with and without the facility, as the mock report does.6

How are unlisted startups valued in a fund report?

At fair value, usually under the International Private Equity and Venture Capital Valuation (IPEV) Guidelines, last updated in December 2025, or under the manager's own written methodology.1 The Australian Investment Council is a founding member of the IPEV Board and encourages its members to adopt the guidelines.7 The valuation policy says which applies; page 3 of the report above shows the basis for each holding.

The latest round price is the usual starting point but isn't automatically fair value. The guidelines warn against applying a new round's price to every share class, because later investors often get preferences that make their shares worth more.1

Why does early TVPI move so much, and why does DPI count most?

Early TVPI rests almost entirely on funding-round values, so one strong round can lift it sharply and a downturn can take it back. DPI can't be revised, but it takes years to arrive. In Carta's 2024 data, 25% of 2017-vintage funds had made any distribution after three years and 59% after five; for the 2019 vintage 39% had after five years, and for 2021 just 9% after three.2 One exit can change this: a single sale can lift DPI from zero in one quarter, so it tends to move in steps rather than a smooth line.

Until a fund has paid real cash back, treat its TVPI as an estimate. How a venture fund works explains why the cash comes so late.

How do you benchmark a fund against its vintage year?

Compare it with funds of the same vintage year, which invested in the same market and have had the same time to mature. Carta publishes fund performance by vintage and fund size, drawn from funds that use its software.3 Cambridge Associates publishes vintage-year benchmarks ranked by IRR and multiples, though the full reports are paid.4 Both lean towards US funds, and Australian benchmark data is thinner. Side Stage and Dealroom's 2026 report put Australian venture's five-year pooled return at 24.4% net, almost double US peers; those are past results.8

The spread is wide even within a vintage. At the end of 2025, 2019-vintage funds on Carta ranged from 1.02× net TVPI at the bottom quartile and 1.33× at the median to 1.9× at the top quartile and 3.01× at the top decile, still mostly unrealised.9 Fund size matters too. For 2018-vintage funds on Carta, the top decile of US$1 million to US$10 million funds reached 4.03× net TVPI by the end of 2024, against 1.67× for funds of US$100 million or more.3 When a manager claims a top-quartile result, ask which benchmark, which vintage, which date and whether the figure is net. Stage and fund size explains why smaller funds can reach higher multiples.

What should you check in a fund report?

That it adds up and that the letter matches the numbers. Ask about any of these.

• A capital statement that doesn't reconcile with the last one, with no restatement note.
• Valuations that only ever go up, including through a market downturn.
• An IRR quoted on its own, without TVPI and DPI.
• Figures that don't say whether they're gross or net.
• A change in valuation method, auditor or fee calculation that isn't explained.

Plenty varies between managers and isn't a concern on its own, such as holding companies at cost until a new priced round, reporting fees and costs in one line, reporting net TVPI and DPI without IRR, a fund-level capital statement, a format other than the ILPA templates, and unaudited quarterly figures. How to vet a venture fund has the questions to ask before a client commits, and How venture returns work covers what a realistic result looks like.

Frequently asked questions

Talk to us about Fund III

Tall Order is a Melbourne seed fund. Fund III is a registered ESVCLP for wholesale investors. Justine Lum, our Head of IR, works with advisers and their clients.

Contact Justine Fund III