---
title: "What Is Mark-to-Market?"
term: "Mark-to-Market"
description: "Mark-to-market is valuing assets at current fair value rather than historical cost—standard for fund portfolio reporting and for adjusting holdings to observable market prices."
date: 2026-07-25T00:00:00.000Z
updated: 2026-07-25T00:00:00.000Z
topics: ["venture-capital"]
source: https://venturecapitaltracker.com/glossary/mark-to-market
---

# What Is Mark-to-Market?

> Mark-to-market is valuing assets at current fair value rather than historical cost—standard for fund portfolio reporting and for adjusting holdings to observable market prices.

**Mark-to-market** is the practice of measuring assets at their current fair value, updating carrying amounts when market or transaction evidence changes.

### How it works

Public securities mark-to-market daily using exchange prices. Private funds mark portfolio companies each reporting period using:

- Recent financing rounds (primary or secondary)
- Comparable public company multiples
- Revenue or EBITDA-based models with discount rates
- Third-party valuation firms for ASC 820 / IFRS fair value

When fair value rises, funds record a [mark-up](/glossary/mark-up); when it falls, a [mark-down](/glossary/mark-down). [NAV](/glossary/nav) aggregates marked values minus liabilities.

Illiquid startups lack continuous prices, so mark-to-market is judgment-based—governed by valuation policies and LPAC review on contentious calls.

### Why it matters

- **Founders:** A new round is the clearest mark-to-market input. Long gaps without pricing invite GP models that may not match your self-assessment.
- **Investors:** Mark-to-market NAV drives DPI/TVPI interim metrics. Stale marks distort GP league tables; aggressive marks reveal discipline or optimism.

### Common mistake

Thinking mark-to-market applies only after IPO. Private funds mark continuously; public listing just adds a visible ticker to the same concept.

### Related ideas

See also [mark-down](/glossary/mark-down), [mark-up](/glossary/mark-up), [NAV](/glossary/nav), and [409A valuation](/glossary/409a-valuation).

## FAQ

### What is mark-to-market in simple terms?

It means reporting what an investment is worth today, not what you paid years ago. If your startup's latest round sets a new price, funds update carrying value to reflect that fair value.

### Why does mark-to-market matter?

LPs rely on marked NAV to track fund performance between exits. Founders should know that idle cap tables without fresh pricing may still get marked using comps or performance models.


---
Source: https://venturecapitaltracker.com/glossary/mark-to-market