---
title: "What Is Realized Value?"
term: "Realized Value"
description: "Realized value is cash or stock actually returned to investors from an investment — after a sale, distribution, or secondary — as opposed to unrealized marks on still-private holdings. Fund performance metrics like DPI depend on realized value."
date: 2026-07-25T00:00:00.000Z
updated: 2026-07-25T00:00:00.000Z
topics: ["venture-capital"]
source: https://venturecapitaltracker.com/glossary/realized-value
---

# What Is Realized Value?

> Realized value is cash or stock actually returned to investors from an investment — after a sale, distribution, or secondary — as opposed to unrealized marks on still-private holdings. Fund performance metrics like DPI depend on realized value.

**Realized value** is proceeds actually distributed to fund LPs or returned to shareholders from liquidity events — distinct from [/glossary/paper-gain](/glossary/paper-gain)s on illiquid positions.

## How it works

When a portfolio company sells, IPOs, or pays a dividend, the fund converts holdings to cash or transferable stock, pays expenses, then distributes per the LPA waterfall. Realized value accumulates in DPI (distributions to paid-in capital). Unrealized value remains in NAV marks until exit. Secondary sales of fund stakes or company shares also realize value early.

Founders encounter the term in cap-table and investor updates when VCs describe partial secondaries vs holding for IPO. Realization timing affects carry crystallization and LP cash flow.

## Why it matters

- **Founders:** Understand that your high valuation does not realize value for investors until liquidity — shaping pressure near exit windows.
- **Investors:** GPs marketing TVPI without realized value face skeptical LPs in fundraising.
- **LPs:** Cash distributions fund pension obligations; paper marks do not pay beneficiaries.

## Common mistake

Treating a 409A or last-round mark as realized wealth. Until a transaction closes, value can still move down.

## Related ideas

[/glossary/paper-gain](/glossary/paper-gain), DPI, TVPI, and [/glossary/liquidity-event](/glossary/liquidity-event).

## FAQ

### What is realized value in simple terms?

It is money actually back in investors' pockets from an exit or distribution — not the estimated worth of shares still held in private companies.

### Why does realized value matter?

A fund can show high TVPI on paper; LPs care about DPI from realized value to fund commitments, pay carry, and judge whether vintage year performance is real.


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Source: https://venturecapitaltracker.com/glossary/realized-value