As a tech consultant for startups, I often hear people misuing multiples and percentages. Here's a little cheatsheet on:
|Starting Cash||Ending Cash||Percentage of Return||Return Multiple|
How to Calculate an ROI
If you invest $50k into a project and receive $64k, then your Return on Investment is 28%. This is calculated by taking the difference between current (or expected) value and original value, divided by original value and multiplied by 100.
# Starting Investment investment = $50k # Current (or expected) Value value = $64k # Rate of Return / Return on Investment ror = value / investment # Decimal of Return decimal_ror = ror - 1 # Percentage of Return percentage_of_return = decimal_ror × 100
Keep It Simple