Sponsor equity invested in an LBO, typically 30%–50% of total enterprise value at closing — the loss-absorbing cushion that protects all debt tranches. The lender's effective LTV on the senior secured tranche is Senior Debt/EV; first-lien attachment typically runs 0%–50% LTV and unitranche 0%–70% LTV. Larger sponsor equity is a credit positive because the sponsor has more to lose before the lender does.