Challenge: Top firm's ability to grow client base was limited by its risk appetite
A top-ranked global law firm wanted to take on more risk in commercial litigation matters and help ensure the firm’s partners had opportunities to originate new clients and bring in new business. To help this initiative move forward, the firm needed to ease the financial burden of paying case expenses out of pocket for new contingent commercial matters. The firm had considered financing cases on an individual basis but recognized significant cost and administrative inefficiencies in pursuing one-off funding requests.
Solution: $25 million facility to expand law firm's commercial practice
To expand its commercial practice without adding risk or complicated administrative hurdles, the firm expanded an existing portfolio relationship with Burford by $25 million to bundle the firm’s existing and new contingent risk in a single financing arrangement.
The portfolio finance arrangement provided administrative relief to the law firm, which otherwise would have had to evaluate competing proposals from finance providers for every new case taken on risk. The portfolio investment made cash immediately available for use as new cases come in, subject to case review. Because the expanded portfolio had a more diverse mix of cases in terms of case type and duration than the original arrangement, the firm also benefited from a further reduced cost of capital.
Impact: Upfront cash and ability to expand practice without increasing risk
With the wider portfolio facility in place, the firm can increase expected upside from contingency work without materially increasing its overall risk exposure—and seek still more growth across various firm practice areas.