After you invest in a company on Wefunder, the value of that investment will change over time. It may go up if the company raises additional rounds of financing, is acquired, or goes public. It may go down if the company goes out of business. That change in value is referred to as the “return” on your investment.

Your return is referred to as an “unrealized return” if the value has increased on paper, but has not yet been paid out to you. For example, if you invested in a company that later raises a new round of financing at a higher valuation, your investment has incurred an “unrealized gain”. Or, if the new financing round was at a lower valuation, your investment would have an “unrealized loss”.

Your return is referred to as a “realized return” if the change in value has been locked in. For example, if you invest in a company that is later acquired at a higher valuation, your investment has incurred a “realized gain” once the acquisition proceeds are distributed to you. If the company instead were to go out of business and the value is marked down to $0, your investment would incur a “realized loss”.