What does 1x, 2x, and 10x mean as percentages?
As a tech consultant for startups, I often hear people misusing multiples and percentages. As a primer, here's a simple table showing you what things look like when you buy and sell a company.
|Starting Cash||Ending Cash||Percentage of Return||Return Multiple|
How to Calculate Return on Investment
If you invest $50k into a project and receive $64k, then your Return on Investment is 28%. You calculate this by subtracting the current (or expected) value from the original, then divide again by the original.
For those of you who like algebra, here's a second way to show the same info.
Keep It Simple
Here's yet another way to present the same information as the table above.