The C-H activation in the tandem, “merry-go-round”, [(dppp)Rh]-catalyzed (dppp=1,3-bis(diphenylphosphino)propane), four-fold addition of norborene to PhB(OH)2 has been postulated to occur by a C(alkyl)-H oxidative addition to square-pyramidal RhIII-H species, which in turn undergoes a C(aryl)-H reductive elimination. Our DFT calculations confirm the RhI/RhIII mechanism. At the IEFPCM(toluene, 373.15 K)/PBE0/DGDZVP level of theory, the oxidative addition barrier was calculated to be 12.9 kcal mol−1, and that of reductive elimination was 5.0 kcal mol−1. The observed selectivity of the reaction correlates well with the relative energy barriers of the cycle steps. The higher barrier (20.9 kcal mol−1) for norbornyl–Rh protonation ensures that the reaction is steered towards the 1,4-shift (total barrier of 16.3 kcal mol−1), acting as an equilibration shuttle. The carborhodation (13.2 kcal mol−1) proceeds through a lower barrier than the protonation (16.7 kcal mol−1) of the rearranged aryl–Rh species in the absence of o- or m-substituents, ensuring multiple carborhodations take place. However, for 2,5-dimethylphenyl, which was used as a model substrate, the barrier for carborhodation is increased to 19.4 kcal mol−1, explaining the observed termination of the reaction at 1,2,3,4-tetra(exo-norborn-2-yl)benzene. Finally, calculations with (Z)-2-butene gave a carborhodation barrier of 20.2 kcal mol−1, suggesting that carborhodation of non-strained, open-chain substrates would be disfavored relative to protonation.