Two more legal cases have reportedly been resolved by AxiaFunder, which is one of Europe’s first litigation funding platforms.
AxiaFunder, Europe’s “first for-profit” litigation funding platform, has acquired £1.9 million from investors since establishing operations in January 2019, with a 100% “success rate” on completed cases, the company claims.
Co-founded by investment banking professional Cormac Leech and entrepreneur Sophie Liu, AxiaFunder has fully funded 13 cases through its platform, to date.
As noted in a press release, the company reports winning all 5 cases that have ended with an average investors’ return of around 55%, and as high as 94%, the company reveals while clarifying that they want to remind investors that past performance is “not indicative of future results.”
The other 8 cases are still ongoing, which includes a software case in Barcelona, AxiaFunder’s first international case. Two other litigation investment opportunities have now been added to the platform.
The current cases at the funding stage reportedly include a shareholder dispute case that involves a high-value house-building business, along with a group litigation claim filed against two retail banking institutions (the funding is currently in the process of closing).
Cormac Leech, the London-headquartered firm’s Co-founder and Chief Executive, noted that one of the main attractions of litigation funding as a new asset class is the degree or extent to which it doesn’t correlate with the wider economic ecosystem.
He remarked:
“Litigation is not largely impacted by variability in economic growth in the same way traditional assets such as equities and bonds are. Indeed, there is an argument that litigation funding provides investors with an attractive alternative in times of economic uncertainty. With equities at multi-year highs many investors may think it is a good time to diversify out of equities, and litigation funding is an option for some high net worth and sophisticated investors to consider.”
He added:
“With the potential high return, investors also need to be aware of the risk of capital loss in litigation funding. Investors can find more information on our website’s risk warning section.”
A multi-stage vetting program can ensure that only those cases with a solid chance of success – around 1 in every 20 cases handled or chekced by the AxiaFunder team – are able to make it onto the platform.
The risk of loss is addressed or mitigated by After the Event insurance (ATE insurance), which aim to minimize the liabilities of a case that has failed.
It’s mandatory for all cases funded via the platform to have ATE insurance where adverse cost risk can be found, and solicitors are usually paid partially on a CFA (conditional fee agreement) contingent basis in order to ensure alignment of interests and to make sure costs are affordable.
AxiaFunder is a trading name of Champerty Limited (FRN 811606), an appointed representative of Share In Ltd (FRN 603332), which is authorized and regulated by the Financial Conduct Authority (FCA).
AxiaFunder is a member of the UK Crowdfunding Association.