FinTech: Validity Finance, A Legal Dispute Funder And Alternative Asset Manager, Raises $70M
Validity Finance is a commercial litigation finance company with nearly $150 million of assets under management.
Validity Finance has raised a new managed “sidecar” fund of $70 million from a major family office, its existing private equity investors as well as other third-party investors.
Validity Finance track record
· Third-party managed funds total nearly $150 million of assets under management as on date
· Committed nearly $300 million towards clients in more than 40 separate investments since founding in mid-2018; in the past 18 months alone this figure amounted $150 million across a wide span of cases
· Reviewed over 1,500 investment opportunities since its founding under its due diligence process
· Backed contract disputes, antitrust claims, trade secret and misappropriation claims, insurance coverage cases and intellectual property matters. The firm has also supported civil rights cases, commercial matters across federal and state courts, as well as domestic and international arbitration. (CROWDFUND INSIDER)
Pandemic created pressures on litigants
Validity CEO Ralph Sutton commented: “The pandemic created enormous challenges for pending cases, with trial dockets slowed and financial pressures weighing on many claimants.”
In another emerging trend, Validity noted a spike in litigation funding inquiries from large companies who were looking for alternatives to normal financing channels.
“Corporates have come to appreciate the sophistication and focus of high-quality dispute funders,” observed Sutton. “Even well-capitalized businesses understand the economic advantages of litigation funding to move risk off their balance sheets.”
Validity plans to revitalize its expansion plans that were paused during the pandemic. It expects to report further growth by the close of 2021.
Last week, commercial litigation financier Longford Capital Management, LP, announced the final closing of its most recent fund at $682 million.
The firm’s assets under management now exceed $1.2 billion, placing it among the largest private equity firms focused on investments in legal assets.
“We have seen significant growth in interest in litigation finance from leading institutional investors and high-net-worth individuals eager to put their money to work in an uncorrelated asset class,” said Timothy S. Farrell, co-founder and managing director of Longford Capital.
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