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Fund Performance and Benchmark Analysis
Send the fund's dated cash flows and NAV history, and get every metric restated onto a basis two funds of different ages can be compared on.
Search how to benchmark fund performance and the answer comes back as a purchase. Buy the vintage-year dataset, find your quartile, present the quartile. What none of those results settle is the thing that actually breaks the comparison, which is not the quality of the peer data. It is that a seven-year-old fund and a thirteen-year-old fund get compared on the same four metrics as though age were a detail rather than the largest single term in three of them.
Wrenfield Capital Partners III is a 2019 vintage that has called 135.0m of a 150.0m commitment, distributed 91.0m and carries a 128.0m NAV. Its DPI is 0.6741. The firm's 2013 vintage, Wrenfield II, has a DPI of 1.9221. Read side by side that is a gap of 1.2480 of paid-in capital. Restated to the same fund age, 27 quarters after first close, Wrenfield II had a DPI of 0.7922 and the gap is 0.1181.
So 90.5 percent of the apparent difference was the calendar. The run does three restatements and reports each one separately. Every metric is recomputed at a common fund age, using only the cash flows that had occurred by then. IRR is solved twice, once on the LP's own dates and once on the subscription facility's. And NAV is tested for a drawn facility balance that was never netted out of the reported figure. It produces no quartile, no ranking and no view on the manager.
Three of the four metrics move with fund age, and one of them moves the wrong way
An internal rate of return is money-weighted and annualised, which makes it most sensitive when the denominator of elapsed time is small. Wrenfield II shows this on its own record rather than against anybody else's. At 27 quarters its IRR was 14.71 percent on a DPI of 0.7922. At 51 quarters, with the same fund having returned 148.0m against 77.0m of paid-in capital, the IRR reads 13.28 percent on a DPI of 1.9221. The multiple more than doubled and the rate fell 1.43 points: later money earns a lower annualised rate on a longer clock.
DPI moves the other way and it starts at zero for everyone. Wrenfield III recorded a DPI of 0.0000 for its first eleven quarters, not because nothing was working but because nothing had been sold. Its full series reads 0.0000, 0.0000, 0.0000, 0.0504, 0.1481, 0.3111, 0.6741 at successive year ends. Any comparison drawn against a fund past its harvest period is reading the difference between two positions on that curve. TVPI is the pair of them added together, so it inherits half of each problem and hides both.
Two adjustments have to happen before any of it is comparable. Where a fund reports gross performance, the Investment Advisers Act marketing rule-1) requires net performance alongside it with at least equal prominence, over the same period and on the same methodology. And where a subscription facility is in use, ILPA is direct about what it does to peer data. LPs evaluating benchmarked performance should account for the effect on quartile rankings and vintage classification, because commercially available benchmark providers are very likely to include both funds that use facilities and funds that do not.
How it works
Send the cash flows
Every call and distribution with its date, the commitment, and the first close the fund's age is measured from.
Restate to one age
Each fund's metrics recomputed at the same number of quarters after first close, truncating everything later.
Split the facility out
IRR run on the LP's own dates and again on the facility's, with the interest the LPs bore stated.
Check what NAV holds
A drawn facility balance, a receivable or an accrued carry inside NAV, each named and quantified separately.
What you get
- Every metric recomputed at a common fund age, using only the cash flows that had occurred
- IRR reported twice, with and without the facility's bank-to-fund flows, on a stated method
- NAV tested for a drawn facility balance that was never netted out of the reported figure
- A cash flow schedule you can rebuild each figure from, dated line by line
- The comparison marked valid or not valid on a stated age rule, rather than left implicit
- No quartile, no ranking and no verdict on the manager: the metrics and their basis only
Common questions
Does this tell me whether the fund is good?
No. It computes the metrics, states the basis each one was computed on, and says which comparisons that basis supports. There is no quartile, no score and no assessment of the manager anywhere in the output. Whether a DPI of 0.6741 at 27 quarters is good is a judgement about strategy and market, and it belongs to whoever is paid to make it.
Why does the subscription facility change the IRR at all?
Because it moves the dates the LP's money left, not the amounts. On Wrenfield III's flows, calls bridged for 150 days at 6.30 percent lift IRR from 12.66 to 13.38 percent while TVPI falls from 1.6222 to 1.5813, since LPs bore 3.4952m of interest. The better-looking metric describes the worse outcome, which is why ILPA asks for both.
What counts as the fund's age?
Quarters elapsed since first close, which is what the run uses, and it is not always the same as the stated vintage year. ILPA notes that vintage classification can be tied to the date of first net cash flow rather than first investment, so two funds labelled the same vintage can sit two or three quarters apart. The output prints the age it used.
Can it work out the facility effect if I only have net numbers?
Only partly, and it says so rather than estimating. Removing the facility needs the draw dates, the amounts, the days outstanding and the all-in cost. With those it recomputes the LP's own dated flows. Without them the run reports that the unlevered IRR is not derivable from what was supplied and names the four fields required.
How does this differ from the quarterly reporting package?
The package states this quarter's figures on the fund's own basis. This restates them onto a basis somebody outside the fund can compare against something else, which is a different job. Where the marks feeding those figures are the question, the valuation methodology pack carries the bridge, and a 409A and valuation report review reads the appraisal one of those marks was struck on.
What about a facility balance still drawn at the measurement date?
That is the check that catches the most reported error, and it is arithmetic. Wrenfield III holds 137.0m of gross assets against a 9.0m facility balance, so NAV is 128.0m. Computed on gross assets TVPI reads 1.6889 rather than 1.6222, overstated by exactly 9.0m over 135.0m of paid-in capital. The run prints both and names the difference.
Does it handle the money-in-money-out timing on a co-investment?
Yes, and single-asset vehicles are where age restatement matters most, because one exit is the whole record. The same rule applies: truncate to a common age before comparing. For the vehicle's own economics rather than its returns, the capital call and distribution pack holds the notices the flows come from.
Fund Performance and Benchmark Analysis
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