Launching on the Goldfinch Protocol
  • 🌎Introduction
  • 📚Helpful Resources
  • 🔬Understanding the Goldfinch Protocol
    • Protocol Mechanics
    • Capital Providers
      • Sample Backer Economics
    • Borrower
      • Template Deal Structures
      • Case Study
  • 🏗️Structure and Legal Considerations
    • Cash in and out of the Goldfinch ecosystem
      • Recommended Service Providers
    • Investor KYC / AML Requirements
    • Key Mechanics to Consider
      • Debt Facility Mechanics
      • Transaction Documentation
    • Senior Pool Participation
    • Backer Transferability
  • 🚀Launching a Borrower Pool with Goldfinch
    • Stage 0: Preliminary Actions and Decisions
    • Stage 1: Deal Structure and Timelines
    • Stage 2: Dataroom Preparation
    • Stage 3: Announcements and Tooling Set Up
    • Stage 4: Borrower Closing
  • ❓General FAQs
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  1. Understanding the Goldfinch Protocol
  2. Capital Providers

Sample Backer Economics

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Last updated 3 years ago

Let's take the below deal terms as an example of how back-leverage works:

Hypothetical Transaction:

  • Facility Size - $5,000,000

  • Borrower Coupon - 12%

    • Senior Net Coupon = % Gross Coupon - 20% Junior Relocation - 10% Pool Reserve

    • Junior Net Coupon = % Gross Coupon + 20% Junior Relocation - 10% Pool Reserve

  • Leverage Ratio - 4x

  • Backer Investment: $1,000,000

  • Senior Pool Investment: $4,000,000

Senior Pool Economics: 8.4%

Backer Economics: 20.4%

The table below shows the economics for both the Backers and the Senior Pool for a Borrower Pool with details above. You can download this sheet .

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