Capital Stack
Capital stack refers to the layers of capital financing that fund a company or project, ordered by seniority of claims on assets and cash flows. The order determines who gets paid first in liquidation and how risk and return are distributed across debt and equity.
Example: A company raises 100 million in financing with a capital stack consisting of 60 million in senior secured debt, 15 million in mezzanine financing, 10 million in preferred equity, and 15 million in new common equity.
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