Metrics & Performance
Write-Off
A total write-down of a portfolio investment to zero — when a company has failed and the investment is a complete loss.
A write-off occurs when a VC fund marks a portfolio investment to zero, recognizing a total loss. Companies are written off when they shut down, go through bankruptcy, or are acquired at zero (acqui-hire where equity holders receive nothing). Write-offs are an expected and normal part of venture investing — most VC portfolios have write-offs. What matters is the portfolio-level return, not avoiding write-offs entirely. Experienced LPs evaluate a VC's write-off rate as a signal of portfolio construction discipline. VCs who avoid writing off marginal companies (to protect TVPI optics) while providing bridge capital to 'zombie' companies are doing LPs a disservice. Honest, timely write-offs provide more accurate portfolio valuation and conserve resources for the winners.