Defining a meaningful exit

Let’s start with some venture math assumptions: 

• An early-stage venture fund is going to invest in 20 companies 
• The fund aims to get a 3x gross return 
• The expected distribution of outcomes is: 1/3 losses, 1/3 money-back, 1/3 successes 
• The expected distribution of the successful outcomes is: 1 home-run (a company returning the entire fund) + 5 meaningful exits (companies returning the amount required up to 3x gross fund return.)

A meaningful exit can be defined as a company about to return 1/3 of the fund.