[Verse 1] Sarah's got a million dollars burning holes in venture deals Investing in three startups, wants to know which one's for real Company A pays back slowly, B explodes then crashes down C delivers steady returns, but which deserves the crown? [Chorus] I-R-R, the magic number that we seek Internal Rate of Return makes the strongest players speak It's the discount rate that zeros out your N-P-V When cash flows in and cash flows out reach perfect harmony I-R-R, I-R-R, the heartbeat of your trade I-R-R, I-R-R, where fortunes can be made [Verse 2] Year zero costs a hundred grand, year one brings back just ten Year two delivers forty more, year three pays sixty then We solve for that mysterious rate where present value's nil Trial and error, spreadsheet magic, bend numbers to your will [Chorus] I-R-R, the magic number that we seek Internal Rate of Return makes the strongest players speak It's the discount rate that zeros out your N-P-V When cash flows in and cash flows out reach perfect harmony I-R-R, I-R-R, the heartbeat of your trade I-R-R, I-R-R, where fortunes can be made [Bridge] Higher than your cost of capital means green lights all around Lower means you're hemorrhaging wealth into the ground But watch for multiple solutions when cash flows change their sign One project might have three I-R-Rs, now that's by design [Verse 3] Private equity kings and queens worship this sacred measure Twenty percent internal returns unlock investor treasure Compare it to your hurdle rate, your minimum demand If I-R-R exceeds your floor, extend your eager hand [Chorus] I-R-R, the magic number that we seek Internal Rate of Return makes the strongest players speak It's the discount rate that zeros out your N-P-V When cash flows in and cash flows out reach perfect harmony I-R-R, I-R-R, the heartbeat of your trade I-R-R, I-R-R, where fortunes can be made [Outro] From zero to your I-R-R, that's where the profit lies Master this essential tool and claim your market prize
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