Commercial Litigation Funding

Imagine a person, a small business or group has a legitimate legal claim against a giant corporation, but they simply cannot afford the millions of dollars required for lawyers, court fees, and expert witnesses over several years.

Litigation funding is the process where a third-party investor—who has no direct involvement in the case—agrees to pay all or part of these legal costs. In exchange, the investor receives a percentage of the final settlement or judgment only if the case wins.

The key characteristic is that it is non-recourse: if the case is lost, the investor loses their money, and the claimant owes them nothing. The funder absorbs the risk so the claimant can pursue justice.

How is it Used, and Who Benefits?

Claimants

Litigation is immensely expensive. Funding ensures that the outcome of a case is determined by the merit of the law and evidence, not by which side runs out of money first. It levels the playing field, giving claimants the financial muscle to challenge well-resourced opponents.

Law Firms

It allows law firms to take on high-stakes cases on a contingent fee basis (meaning they only get paid if they win) without risking their own cash flow. Additionally, they can secure funding for an entire portfolio of cases, managing their risk and maintaining capital stability.

Investors

Sophisticated investors use litigation funding because it offers high returns that are non-correlated to traditional financial markets. The success of a legal case depends on legal jurisdiction and evidence, not on whether the stock market or the housing market is performing well. This stability makes it a prized asset class.

Key Legal Industry Metrics:

$400+ Billion annual revenue
271,000+ Federal Cases

Key Legal Funding Metrics:

$20 Billion invested in 2025 (growing to $67 Billion by 2035)
10.7% Compound Annual Growth Rate (CAGR)
2X - 10X multiple of invested capital per successful case
20% Case Qualification Rate
70% Case Success record

To learn more about or get involved with our LexYield Litigation Funding Platform, please contact us.

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