Payback period
How long it takes to get the invested cash back. It answers a different question from internal rate of return (IRR), which is how fast the money compounds.
Payback period in round numbers
An investment of 10 million returning 2.5 million of cash a year has a four-year payback, whatever the eventual exit multiple turns out to be.
Terms Related to Payback period
IRR · MOIC · Cash-on-cash return · Free cash flow · All of the glossary