Protocol Mechanics

Raising capital through the Goldfinch ecosystem can be summarized in four basic steps

Step 1: A Borrower proposes a Borrower Pool to the Goldfinch community, sharing deal terms, structure, and due diligence materials with the Backers.

Step 2: The Backers then perform due diligence on the opportunity. This diligence is based on the information shared, directly communicating with the Borrower, and negotiating key terms of the transaction. Backers then supply capital once a transaction agreement has been signed by both the Backers and the Borrower.

Step 3: The senior pool automatically allocates its capital to fill deal tickets. Senior pool capital contribution to the deal based on the Leverage Ratio calculation - to date leverage is set at 3x and in future will be determined automatically by the protocol (see Whitepaper for initial proposal).

Step 4: The borrower draws the raised USDC from the protocol as a unitranche facility.

These four steps typically take a week to complete.