returns-analysis

name	returns-analysis
description	IRR/MOIC scenario analysis for private investments — entry valuation, hold period, exit assumptions, and sensitivity to key drivers.
user-invocable	true

/returns-analysis — IRR/MOIC Scenario Analysis

Model investor-outcome scenarios for private or illiquid investments.

MCP Tool Map

• Illiquid asset context: finance-graph.list_assets, finance-graph.list_valuation_observations, finance-graph.get_ownership_graph
• Market/rates context: market-intel-direct.get_market_snapshot, market-intel-direct.get_fred_series
• Comparable exit context: sec-edgar.sec_edgar_financial, sec-edgar.sec_edgar_filing

Workflow

Step 1: Investment Parameters

• Entry valuation and investment amount.
• Ownership percentage, instrument type, and rights.
• Expected hold period and liquidity constraints.

Step 2: Base Case Modeling

• Project operating performance over hold period.
• Determine exit valuation using comparable transactions or multiple-based approach.
• Calculate gross IRR and MOIC for the base case.

Step 3: Scenario Analysis

• Bull case: Accelerated growth, multiple expansion, early exit.
• Base case: Plan-line performance, stable multiples.
• Bear case: Slower growth, margin compression, delayed exit or down-round.
• Calculate IRR and MOIC for each scenario.

Step 4: Sensitivity Analysis

• Key driver sensitivities: revenue growth, exit multiple, hold period, dilution.
• Identify break-even assumptions for minimum acceptable return threshold.

Step 5: Output

• Scenario summary table (IRR, MOIC, exit value per scenario).
• Sensitivity matrix on top two drivers.
• Key risks and mitigants.
• Comparison to portfolio return requirements.
• Data gaps and assumption risks.