OUR LITIGATION INVESTMENT STRATEGY
Why post-settlement funding stands apart
Attorneys face an inherent business challenge as contingent fee exposure can handicap operations with unpredictable cash flows, and that ultimately impacts future growth. The challenge of managing cash flow is compounded by the fact that traditional forms of financing are not obtainable. Yet, law firms need to be well capitalized to stave off operational stress while waiting for distributions to occur. Post-settlement funding can accelerate cash flows and mitigate the unpredictable nature of the timing of awards.
A differentiated approach
Underwriting known cash flows
Tower 3 focuses on the timing delta between settlement and payment. We monetize settled awards where liability has already been established, eliminating the most significant risk in litigation funding.
The Key Difference is Settlement.
Settlements Pay.
Pre-Settlement Funding vs. Tower 3’s Post-Settlement Approach
Pre-Settlement Funding | Tower 3's Post-Settlement Approach |
|---|---|
Funds pending cases with uncertain outcomes | Purchase legal receivables from stakeholders in cases where settlements or judgments have been entered |
Risk of total loss if liability not established | In the case of settlements, defendants have made the strategic decision to pay the plaintiffs, rather than risk the uncertainties of litigation |
Returns depend on case success | Primary risk is timing of payment, not outcome |
Unpredictable outcomes | Focuses on known cash flows with defined obligors |
Investment Philosophy
Strategic value creation through disciplined process
Our strategy is centered around our four-pillar process, built on disciplined selection, rigorous assessment, structured agreements, and active oversight.
ORIGINATION
Exceptional Selection
We maintain rigorous selectivity, demanding first-priority liens, creditworthy obligors, and controlled cash mechanisms to build a foundation of quality opportunities.
DUE DILIGENCE
Comprehensive Assessment
Our thorough due diligence validates settlement legitimacy, evaluates obligor creditworthiness, verifies cash flow controls, and analyzes payment timeframes.
AGREEMENTS
Structured Transactions
We structure agreements with appropriate discounts based on creditworthiness and duration, implementing robust security interests and instill cash collection controls through directing payment instructions from the obligor/administrator.
MANAGEMENT
Disciplined Oversight
We prioritize capital preservation by addressing duration risk through conservative positions, longer assumed timeframes, and active monitoring capabilities.
Get in Touch
We welcome inquiries from investors interested in investment opportunities in post-settlement litigation funding.