[FFT1-DROP] Collateral Onboarding Risk Evaluation

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Executive Summary


Debt Ceiling: 15 million
Stability Fees: 4.5%
Min SPV CR: 111%
Min Vault CR: 105%
Min Vault Underlying CR: 116.6%
Liquidation Process:
Check the RWA Documentation for more information.


NOTE: Since Fortunafi posted its MIP6 application, a new arrangement with Pipe has improved the overall risk profile of the pool.


Fortunafi is a fund management firm partnered with Centrifuge as a token issuance platform, initially focusing on Revenue-Based Financing, or RBF, as an asset class. The firm launched a Tinlake pool with Corl as its first Asset Originator, and will shortly add Pipe as its second. RBF (sometimes known as RBI) is a form of debt finance offered to creditworthy businesses with reliable revenue streams. The two Asset Originators have different focus areas and overall sizes of deal flow, and the revenue-based return is structured differently. FortunaFi will act as an Asset Manager pooling many Asset Originators. At scale, this will provide better scaling and a better risk profile for MakerDAO RWA.

For the first Asset Originator, Corl, investees are typically SMEs in digital industries, such as B2B SaaS and ecommerce. It focuses on earlier stage companies and charges a percentage of gross revenue with a buy-out amount of 1-3x at the end of a 24-month term. For the second Asset Originator, Pipe, a larger entity - one of the top three RBF firms, focuses exclusively on the SaaS revenue of much larger companies and charges principal and interest monthly with a maximum term of 12 months. Pipe’s current investors are large hedge funds, some of whom also invested in their recent equity funding (Siemens’ Next47 and Jim Pallotta’s Raptor Group co-led the round, which also included participation from Shopify, Slack, HubSpot, Okta, Social Capital’s Chamath Palihapitiya, Marc Benioff, Michael Dell’s MSD Capital, Republic, Alexis Ohanian’s Seven Seven Six and Joe Lonsdale - see this TechCrunch article).

Here is a high-level breakdown of the two Asset Originators:

Corl Pipe
Revenue model Fixed percentage of gross revenue + 1-3x buy-out at end of term “Principal + interest” over the term, on SaaS revenue only
Term 24 months 12 months
Type of investees Earlier stage companies in digital industries SaaS revenue of large companies
Size of investees About $1 mill annual revenue, at least $50K monthly revenue At least $5 mill annual revenue, usually much larger
Risk measurement Tech platform that performs initial assessment and ongoing monitoring, with links to bank accounts and accounting software of investees Tech-based assessment using quality tranches, of which BBB (Prime++), BB (Prime+) and B (Prime) are Fortunafi’s focus
Expected monthly volume $1-3 mill $10 mill
Rate of return on assets 20-30% 5-8%
Expected pool proportion 5-10% 90-95%

Fortunafi has structured a Delaware-based SPV to house its revenue-based assets from Corl and Pipe, and receives monthly revenue from investees. The financing is tokenized via Centrifuge, and Fortunafi has attracted DROP (senior) investors as well as funded the TIN (junior or equity) tranche at 10% of the pool. The Maker vault will hold DROP with a slight discount and slight over-collateralization, in the same way as with New Silver. While the initial Debt Ceiling is proposed at 15 million DAI, the portfolio is expected to grow rapidly in the first year to a target of $100 million. The DROP rate is now being reduced to 5% to account for the much larger presence of Pipe’s assets.

Major risks

Fortunafi is a new entity while Corl and Pipe are relatively young. The success of the business model is somewhat proven but has not been demonstrated over a substantial time period. Mitigating this risk is the fact that SaaS and ecommerce are now established growth industries and have achieved considerable market presence. And because Pipe invests in the SaaS revenue of larger companies, the risk profile of their investments is low, with a corresponding lower return.

Younger companies attracted to RBF see debt financing as preferable to giving away large amounts of equity. In fact, RBF is often used as a way to increase scale prior to a major round of equity financing, at which time RBF obligations are paid off. Corl’s investees can experience bumpiness in revenue or even business collapse. Several factors mitigate this risk: Corl’s technology and approach, mentioned above; the investor’s senior position with unilateral claim to repayment via arbitration; an extremely tight default time window; and diversification of the portfolio. In addition, Maker proposes covenants below that would limit risk.

Proposed covenants

All the following covenants are considered as soft (meaning no direct action taken) and any breach (and liquidation) will be enforced by either a signal request, a proposition of a MIP46 PPC, and/or a mandated actor proposal.

Allowed investments

  • SaaS or Recurring Revenue companies
  • Ecommerce companies
  • Min monthly revenue: > $50K/month in last 3 months
  • Min annualized revenue - SaaS only: $1M in last 6 months
  • Min YoY growth rate of sub-$5 mill revenue: 20%
  • Age of Investees: 2+ years in operation or post-revenue for a minimum of 6 months


  • Max single investee size: 30% of DC limit utilisation
  • Max ratio of non-SaaS/RR investments (Corl): 30% of DC

Stakeholders rules

  • Issuer TIN share: 60% - or - $1 mill min (Fortunafi Holdings Inc)
  • Non-Maker DROP holders’ share: 25% - or - $1 mill and 10 investors min
  • The RWF team has assessed that the asset originators most likely will be in business in 12 months. In the case of Fortunafi, the fund manager, the impression is the company is in early starting phase and according to the CEO has a current runway of 5 years.


  • Portfolio monitoring: monthly
  • Sector diversification: expected
  • Healthy investee ratios: expected
  • Restrictions on use of loaned amount by obligor: expected
  • Restrictions raising additional debt by obligor: expected
  • Surveillance of underwriting methodology: expected
  • Surveillance of risk scoring methodology: expected

Further Research

  1. Background
  2. Industry analysis
  3. Asset originator analysis
  4. Issuance platform analysis


Revenue-Based Finance (RBF) is an emerging asset class that has grown significantly in the past 15 years. Its roots go back centuries to investment instruments with returns in the form of royalty payments, though it can be argued that royalties are often defined in a limited way (usually referencing forms of intellectual property). Due to the emergence of digital businesses with recurring revenue streams, RBF has gained in significance as an attractive alternative to traditional debt and equity financing. Its risk profile is similar to debt, meaning it enjoys senior position regarding repayment of capital, while its return is higher and can be similar to equity. For investees, it provides growth capital without equity dilution and accessibility to capital when traditional bank loans may be out of reach.

Industry analysis

The industry in this case is both RBF or RBI as a form of investment and the industries of investee companies. Fortunafi via Corl invests in digital industries such as B2B SaaS and ecommerce and target earlier stage companies with reliable revenue streams. Pipe facilitates investment in the SaaS revenue of larger companies. Though digital industries and SaaS encompass a wide range of markets, the assumption in this analysis is that digital industries are well known and the focus will be on startup dynamics.

In “2020 State of the Industry: Revenue-Based Investing,” Thomas Rush of advisory firm Bootstrapp Inc.analyzes 32 RBI firms in the US with 57 distinct funds managing $4.31B in total capital. Of this total, there is an estimated $2.1B of funds allocated to RBI across all years, though the actual number is difficult to confirm as most firms are privately held, and large firms like Kapitus, United Capital Source, Braavo and Clearbanc have claimed billions of dollars in RBI investments. Arthur Fox began using RBI as a form of venture investing for startups in the 1980’s and 90’s, and established perhaps the earliest fund called Royalty Capital in 1992. Few new firms appeared until 2005, and since then the number of RBI firms has grown at a notably faster pace. In the last 10 years (2010-20), 25 firms were founded.

The three largest RBI firms are:

  • Clearbanc, now Clearco
  • Shopify Capital (Shopify being an investor in Pipe, one of the asset originators)
  • Pipe, one of the asset originators in this proposal

There are two (and possibly more) public companies:

  • Flow Capital Corp.
  • Timia Capital Corp.

Pipe innovated the use of recurring revenue contracts as atomic assets that can be loaned against. Here are two articles describing the overall context and significance of this innovation:

How do those assets respond in the event of a particular major economic event?

Investee companies may operate in industries that are susceptible to major shifts in the economic landscape, as we are currently seeing during the pandemic. It is clear that ecommerce has benefited greatly while traditional retail companies have not. Likewise, conferencing and online services that help companies cope with reduced travel and social distancing have also seen a boost. On the whole, digital industries have seen increased growth while some traditional industries have not, and therefore it can be expected that RBI focused on digital industries will benefit.

In the case of a major economic event adversely affecting digital industries, such as the dotcom crash in 2001-3, revenues will be reduced and so will the corresponding return for some RBI investors. However, since investees have reliable revenue streams and are creditworthy to start with, the chances of significant defaults remain low.

What remedial measures might be undertaken?

The remedial measures are clearly defined in the Revenue Sharing Agreement (Corl) between Fortunafi and each investee, and partly in the Whole Receivable Purchase Agreement between Fortunafi and Pipe. In the case of Corl, these measures consist of a Security Interest in the investee’s assets that is senior to all other interests, and a defined monthly payment process using direct debit within 7 days after month end. If payment is not completed within that time, payment can be arranged in a Resolution Period of 48 hours, and if that does not occur, Fortunafi can claim all amounts owed. Besides missing payment, other conditions of default include extending beyond the maximum term (12 or 24 months), and bankruptcy and/or insolvency. Arbitration is mandated.

The details of remedial measures between Pipe and its investees are being collected and this risk assessment will be updated once they are received.

What are the historical default rates in this industry?

The private nature of venture firms investing in RBI deals and lack of common industry associations mean historical default rate datasets are rare. Only empirical information made public by funds in press releases or comparison to default rates in the wider venture-debt financing category can be found. Venture Lender estimated default rate to be 3% in 2016, close to US-high yield loan default rates (3.5%). These figures are also in line with private-held firms’ probability of default ranges (1-4%). Empirical research also shows that increase in the following metrics reduces Probability of Default (PD) in early stage startups (< 3 years old):

  • Leverage Ratio: Equity / Total Liabilities (Solvability); Equity / Total Assets
  • Coverage Ratio: Net Debt/ EBITDA (Debt-to-EBITDA)
  • Activity/efficiency Ratio: Net Sales / Total Assets (Asset-turnover)
  • Human Capital: Founders’ Education, Founders’ Management Experience

Asset originator analysis

Corl uses its own technology platform to underwrite applicants with links into the companies’ accounting systems and bank accounts. This direct connection into cashflows, P&L and balance sheets is then analyzed with risk parameters to determine not only a company’s health at origination, but also its ongoing and future performance. Needless to say, this provides great insight into the security and size of the investor’s return on investment, which is in the region of 15-30% annualized. The maturity is 24 months and investees also have a final buy-out amount which is 1 to 3x the original investment.

Pipe uses a similar approach of connecting with SaaS companies’ financial and accounting systems, and marries that with internal data about industries. Their rating system groups SaaS contracts into levels or tranches of quality.

When was the asset originator incorporated?

Corl Financial Technologies Inc. was founded in 2017. Pipe was founded in 2019 and Fortunafi was founded in 2020.

What is the background of the asset originator managers?

Derek Manuge, CEO of Corl, was a risk manager at ScotiaBank and KPMG, participated in the Global Association of Risk Professionals, and performed quantitative model development in his own consulting company before co-founding Corl. His extensive experience and knowledge of quantitative modeling has been central to the development of Corl’s underwriting platform.

Harry Hurst, CEO of Pipe, is a serial entrepreneur who developed a passion for technology early in life, graduating high school age 12 studying Computer Science. Harry and Pipe (Pipe – Grow on your terms) co-founder Josh Mangel built their first company Skurt, a financial technology company in the mobility space. After four years, Skurt was successfully acquired by Fair (https://www.fair.com/) in 2018. Pipe was founded in 2019, to unlock the largest untapped asset class in the world — revenue — to empower entrepreneurs and companies to grow their business on their terms without debt or dilution. Harry has raised over $150 million for his companies and is considered an industry expert on financial technology and emerging asset classes.

Nick Garcia, CEO of Fortunafi, has over 8 years of experience in both fintech & crypto. Nick started off in fintech at Wells Fargo’s Tech & Venture Group (working on deals for Lending Club, Funding Circle, Prosper, & others). He then led finance & strategy at Zenefits (https://www.zenefits.com/), a fintech & insurtech solution for SMBs, and then was the head of finance at Shippo, a multi-carrier shipping API and led the Series A & B with Union Square Ventures and Bessemer Venture Partners. He started investing & trading digital assets in 2013 and Co-founded Space Whale Capital in 2018. Space Whale Capital LP is a proprietary investment firm that manages a discretionary trading strategy and has been actively investing and participating in DeFi since inception.

How many deals has the asset originator already done? What is the notional amount?

Corl has provided its platform to the Canadian government on a SaaS basis since 2019. The details of the Canadian government’s investment program are under NDA but the notional amount of investment was roughly $5-10 mill in 2019. In 2020, Corl began to originate investments from its balance sheet and launched a small portfolio with notional value of $425K, but progress was stopped by the pandemic and 1 of 3 investees suffered a default. In late 2020, Fortunafi partnered with Corl and established a Tinlake pool. The characteristics of this Tinlake pool are as follows:

  • Total number of investments: 3
  • Total pool value: 973,002 DAI
  • Average investment size: $300,000
  • Average Royalty Rate %: 4%
  • Average Buyout Rate %: 100% - 150%
  • Average Annual IRR %: 20%
  • Defaults: 0
  • Location: US
  • Links: Tinlake UI

Regarding Pipe, according to TechCrunch: “In the first quarter of 2021, tens of millions of dollars were traded across the Pipe platform. Between its launch in late June 2020 through year’s end, the company also saw “tens of millions” in trades take place via its marketplace. Tradable ARR on the platform is currently in excess of $1 billion.” Fortunafi will start acquiring Pipe loan assets in June 2021.

Has the asset originator experienced a default? What is the plan in case of default?

One of Corl’s initial investees in 2020 had a large retail footprint and was badly affected by the pandemic. The investment amount was $25K and default occurred quickly. Corl has a personal guarantee against the owner and is in first position on the business, but the court system was backed up during the pandemic. Subsequent investments mandated arbitration to avoid the standard legal process via the court system.

Pipe has had no defaults so far. As noted above, this risk assessment will be updated with details of the remedial measures once received.

What is the due diligence they use to accept an asset?

The due diligence process is extensive. Corl’s platform accesses the financial records and bank account of the investees and performs a comprehensive risk assessment. The platform assigns a credit score and generates an investment report that is reviewed by staff as part of the manual due diligence process. The overall due diligence process includes:

  • Owner(s) information (e.g. name, contact, equity stake)
  • Business information (e.g. nature, duration, number of owners)
  • Credit worthiness and credit rating of business owners
  • Financial and banking position (e.g. profitability, financial performance, revenue history)
  • Current number of paying customers/existing subscriptions and projected growth and/or churn
  • Financial performance indicators (e.g. ratios)
  • Projections and sensitivity testing of revenue growth
  • Quality of management, product/service, and business
  • Social profile and web search information (e.g. reviews, traffic)
  • Risk scores and associated risk metrics derived from supplied information (e.g. supplier/dependency risk)
  • Prospects for success of the business
  • Material investment, financing, and operating contracts
  • Capitalization tables, details of funding rounds, shareholder registrar
  • Other “know your client” requirements, including Anti‐Money Laundering provisions and company supporting documents

After origination, the Corl platform provides an ongoing view of its investees’ financial performance, further reducing risk by flagging performance warnings.

Pipe uses a similar approach of integrating with investee’s financial systems and summarizes its use of data as follows:

Data sources include but are not limited to real-time continuous access to:

  • Bank account(s) balance & transaction history
  • ERP & accounting systems (e.g. Quickbooks, Xero, Netsuite etc.)
  • contract & billing management/payment processing systems (e.g. Recurly, Stripe, Chargebee etc.)
  • Internal Pipe data relating to historical performance across industry, company, asset & payments. (Proprietary data and models)

Here is Pipe’s description of their underwriting process:

Pipe Technologies has developed a proprietary Recurring Revenue Asset (“RRA”) Score that utilizes multiple data sources and data analytics in order to assess sell-side company quality and provide a basis for buy-side investors to make informed decisions. This methodology shares certain features with the corporate credit rating methodologies applied to issuers and instruments in the listed markets, however it is designed with the specific financial instrument - the trading of short-tenor recurring revenue streams - and the specific customer segment - companies in recurring revenue industries - in mind.

What is the valuation model used?

The valuation model in both cases is proprietary, but based on normal risk measures involving credit worthiness, cashflows, balance sheet and operating performance. See above.

What is the nature of asset defaults for the originator, and the possible solutions?

Default is primarily defined as late payment, and the default process is described above. In the worst case, Fortunafi will exercise its most senior claim against the investee’s assets using arbitration. More commonly, the investee will work out a payment arrangement with Fortunafi. In the case of bankruptcy and/or insolvency, arbitration could result in a months-long process (though shorter than a standard legal process) and result in partial or total loss of the investment, though monthly payments made before that event result in some return.

What are the historical default rates of the originator?

The historical default rates of Corl’s investees is not known, aside from the one default noted above. Since 2019, the Canadian government has used Corl’s platform to fund small businesses and permission to disclose any details of that activity has not been granted. The Canadian government had adapted their program during the pandemic and is now updating it again as Canada emerges from the pandemic.

Again, Pipe has experienced no defaults.

What explains the difference in default rates between the asset originator and the industry?

With the exception of loans originated through the Canadian government program, Corl’s default rates used in its back-test are in line with industry default probabilities. However, the sample of real financing considered here is not statistically significant to do a real comparison of PD rates. Once we build a longer performance record for RBFs, we will be able to assess the quality of Corl’s back-testing scenarios and score modelling accuracy.

Pipe’s focus on larger and more mature companies reduces default risk substantially, and since there have been no defaults, their performance to date is above any default rate.

Issuance platform analysis

Fortunafi uses the Centrifuge Model, and details about Centrifuge can be found in the New Silver risk assessment.


Perhaps I skimmed over it, but do we know when a default event would occur after missed payment?


Very cool–not many startups have a runway of 5 years. :+1:t4:

The thing I like about Revenue-Based Financing is the incentive for companies to produce revenue early and the higher the monthly revenue, the higher the monthly percentage return to the lender. Good stuff IMO. Thanks Phil!

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As always I’m happy to see more RWA hit the onboarding pipeline, but I’d like to see a few concerns addressed around operations/structuring (especially with a debt ceiling of this magnitude). The following are addressed to whoever feels most confident answering. Also, to address the potential conflict that I have since I am running a business that will perform many of the services that I’m about to inquire about, I want to be clear that I’m not using this as a platform to petition business – these are questions I would ask any RWA applicant to MakerDAO.

  1. What efforts have been taken to ensure the borrowing entity will not be subject to substantive consolidation by a bankruptcy court (e.g. if one of the SPVs chose to file a strategic bankruptcy to recoup a portion of their investment)? Is there an independent director or trustee that would be likely to block a bankruptcy filing based on the terms of the credit agreement? If not, why?

  2. What due diligence has been done on the applicant themselves? Is the RWF Team familiar with their beneficial ownership/what checks have been run on their beneficial ownership?

  3. What operational controls are in place to ensure that the Dai is not lost en route to/from the applicant or their designated trading desk?

  4. What is Maker’s recourse in the event of nonperformance, breach of covenants or a lack of reporting from the applicant? I.e. how will we get our money back?

  5. What efforts are in place to prevent fraud? Will the RWF team be putting in place any controls around revolving the facility into new loans?

  6. Who will be monitoring the underwriting standards of the applicant on a continuing basis?

Please don’t let my questions lead to the impression that I’m not excited about this application. My personal philosophy is “trust but verify” :slight_smile:


With Corl, there is a default in 7 days after month end, and then a 48-hr remediation period. That was in the risk assessment. We are waiting for details about Pipe.


Last time I check this was not a Citigroup senior tranche RMBS. Risks are indeed present that explains why we could have 4.5% (which is above high yield).

  1. The SPV seems remote in a remote-friendly state. We are hiring a law firm to audit New Silver and soon after that we will most likely add an independent director (in any case if the AUM grow as expected). Strategic bankruptcy will no longer be possible (the independent director’s main job is to not sign the voluntary bankruptcy).

  2. None. We are wholesale. We might check some to get a feeling but we are not underwriters. That wouldn’t scale.

  3. That probably deserves an audit. But why would someone commit such fraud? In this case, FortunaFi owns a lot of TIN. Committing fraud and losing money seems a losing proposition.

  4. Mainly liquidation. Again, the asset originator (FortunaFi) will lose money as well.

  5. The RWF team conducts a monthly audit. But the fact is fraud is always possible.

  6. FortunaFi, I hope, and RWF CU. But there will be a lag.

There are two main risks:

  • SaaS bubble ending. Well, I wouldn’t bet on it. And it’s uncorrelated to DeFi.
  • FortunaFi ability. If I had an opportunity to invest in FrotunaFi equity, I think I would.

Hi Greg, these are good questions but seem more suitable for a general discussion, as opposed to this particular project. But let me give some partial answers:

  1. We have been discussing the option of an independent director that would have specific duties. This is something that comes at a cost. An intermediate step could be a back-up servicer.

  2. Are you referring to investees, or the fund manager, or the Asset Originators? It’s true, most of our due diligence focus is on the underwriting of the investees by the AOs. Could you give more of the reason for looking at beneficial ownership, and of which entities?

  3. A very general operational question that is worth discussing. With Centrifuge we are focusing on the DAI and leaving it to the AO or fund manager to handle the conversion in the best way possible.

  4. All of the structure, including Centrifuge, is our way of preventing nonperformance, but soft and hard liquidation are the tools of last resort. Perhaps the single most important safeguard is the presence of other DROP investors, which is why that is a covenant. Other people with skin in the game can help protect Maker and even pursue recourse. Since MakerDAO is not a legal entity, we have to be resourceful.

  5. Monitoring is pretty tight and ongoing. Seb can speak more about that. The line of credit is revolving so it is expected that loans will be paid off and new loans made, but tracking that to the actual loans is part of the monitoring.

  6. Part of the monitoring. Also the dashboard and covenants and the part of the dashboard that isn’t public will flag performance problems.

Let’s pick this up in another area of the forum.


This feels super dismissive to what I believe are very reasonable concerns.

This is good. Are you able to publish the legal opinion when it’s ready or at least provide a summary? Also, is there a place to view the agreements with the various covenants? I recall this being on Centrifuge’s website but I don’t remember where. I think giving the community the opportunity to scrutinize the language that enforces the bankruptcy remoteness of the entity is a critical part of expanding debt ceilings.

Okay. I’d personally be very hesitant to offer large debt ceilings without sufficient DD on the borrowers.

Not worried about fraud, worried about user error. To provide a hypothetical: Imagine that they lose the Dai by sending it to the wrong address. The amount may eclipse their entire equity stake. What happens next at this point?

I wasn’t insinuating this doesn’t exist, I’m just not familiar with how these assets would be liquidated. Is there a place to read more about the mechanics of a liquidation?

My main concern lies in the ownership of the entity that is drawing the Dai. From that point it would be the responsibility of that entity to perform these checks downstream. I think something like KYC/AML checks are at a minimum necessary.

Perhaps we can discuss this further in the committee or in a new thread as you said, but I think the way 6s is handling it is nice. The secure conduit contract is already built and approved - I don’t see why we couldn’t general purpose it to Centrifuge borrowers as well.

Thanks for the more detailed reply, but as I mentioned to Seb…is there an outline of the specific mechanics?

This is good. Is there a place to learn more about what the specific monitoring entails? I’d also be curious to understand (and potentially help with) how this scales. As Seb said, your team aren’t functioning as underwriters so this will become pretty overwhelming at scale.

@LongForWisdom can you do that thing where you magically make this a new thread? :sweat_smile:

I think it would be worth assembling a number of posts and parts of risk assessments where details like the ones you’re seeking have been discussed.

The number one issue with RWA is defaults, because they operate in the real world. There are numerous safeguards and also processes for re-couping investment when assets drop in value or the borrower stops making payments. This was detailed pretty well in the New Silver risk assessment, and here there is a summary of how Corl structures the default process. The main idea is to have the most senior lien against the asset. Mandated arbitration helps with speed of recovery. In the case of real estate there are several alternatives to actual foreclosure. And so on. But underlying all RWA is the general principle that there is an asset and it has a legal framework around it. It may take longer than a smart contract execution on Ethereum to recover the loan, but there are known processes for doing that. We also have to assume the fund manager or AO will act in their best interest to protect or recover their loans, and that is why they own TIN.


Here are a couple diagrams from the New Silver risk assessment:

Again, this belongs in a general discussion.

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That is an important consideration. We’re making sure we have as much scrutiny as operationally, contractually and humanly possible into the underlying quality of the borrowers. Maker is not involved in the direct underwriting process, but we ensure spot checks can be done with the Fund manager and/or Asset originator. Also, another important aspect here will be scaling up the data infrastructure to make sure a more automated 3rd party validation of underlying borrowers is in place through services like D&B, Experian or FICO. We’re not there yet.

Another important consideration, from a security stand point. We’ve been talking to asset originators and, where the scale justifies, we ask specifically for custodial services to be put in place as well as insurance through companies like Anchorage and the like. For larger exposures, this will mostly definitely become a hard requirement. Another aspect is standardisation of best practices for storage, transmission of tokens and key management, which we’re working on with Centrifuge & the AOs to make a requirement.

This is also in the cards for these debt structures, the inclusion of AML/KYC spots checks on borrowers and originators. In the future, we could integrate services like Plaid for these 3rd party checks, but that is probably a few steps off at this stage and will require a bit of scale first.

There is a start in the monitoring here. We’re scaling that further as more collateral is coming.


Not the intention at all. Mainly a way to acknowledge that where there is yield, there are risks. I would love to say that we always find reward skewed risk/reward deals.


For the docs. It at the end of the page.

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@g_dip The templated agreements you were looking for: https://docs.centrifuge.io/build/tinlake/#offering-structure

Fortunafi Update: Adding Independent Director

In preparation for the upcoming Executive Vote, we are sharing here the independent manager service agreement and the updated operating agreement of Series 1 of Fortunafi Asset Management LLC, which is the SPV operating the pool. Both have been fully executed and are effective as of July 15th, 2021. CitadelSPV (https://citadelspv.com/) has appointed Orlando Figueroa as independent manager and managing director making the SPV fully bankruptcy remote.

Every interested community member can register as a DROP Investor Representative to get full notification rights without the need to sign a DROP subscription agreement and to purchase DROP tokens individually. The independent manager will ensure that changes to the Executive Summary can only be executed if:

  • the SPV has notified all DROP Investors and DROP Investor Representatives about the change in an email with the Executive Summary attached including deleted, replaced, and new content;
  • the SPV has posted these changes on the Maker forum
  • the notification has happened at least 28 days ago
  • there are no open DROP redemption requests

The last point gives MKR holders the ability to disagree with those changes. The Maker community has 28 days to do a vote and trigger the redemption of the DROP tokens in the Maker vault if there is a disagreement. The change cannot take place as long as this redemption is not fully satisfied, meaning all DROP tokens of the Maker vault are liquidated.

Please find the signed agreements here:




I like the improvement and alignment of interest of all parties involved. Little by little, we are learning how to onboard RWAs. I like the direction this is headed.

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