Global Litigation Funding Investment Market Overview:
Litigation Funding Investment Market Size was estimated at 17.9 (USD Billion) in 2022. The Litigation Funding Investment Market Industry is expected to grow from 19.4 (USD Billion) in 2023 to 40.4 (USD Billion) by 2032. The Litigation Funding Investment Market CAGR (growth rate) is expected to be around 9.6% during the forecast period (2024 - 2032).
Key Litigation Funding Investment Market Trends Highlighted
The Litigation Funding Investment Market exhibits several prominent trends. One key driver is the rising costs of litigation, which has increased the demand for alternative funding sources. Investors are seeking alternative assets with stable returns, and litigation funding offers the potential for attractive yields. Another driver is the growth of mass tort and class action lawsuits, which present substantial funding requirements.
Opportunities in the market include the expansion of litigation funding into new jurisdictions and practice areas. The use of technology and data analytics for case assessment and risk management is also creating opportunities. Furthermore, the increasing awareness and acceptance of litigation funding among law firms and corporations are driving market growth.
Recent trends include the emergence of specialized litigation funders focused on specific sectors or types of cases. The integration of artificial intelligence (AI) into the litigation funding process is also gaining traction. AI is used to analyze case data, assess risks, and predict outcomes, which can enhance the efficiency and accuracy of funding decisions.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Litigation Funding Investment Market Drivers
Rising Litigation Costs and Complexity
Some of the key drivers of the growth of the Litigation Funding Investment Market Industry are the increasing complexity and cost of litigation. The cost of engaging lawyers, paying expert witnesses and covering other litigation expenses can be prohibitively expensive for many individuals and businesses. Litigation funding gives them some ways to invest in the resources required to pursue their claims. As the cost and complexity of lawsuits continue to grow, the demand for litigation funding is expected to keep increasing. Some of the factors that have contributed to this include The increasing number of lawsuits that are complex and high-stake, The rising cost of engaging expert witnesses and other litigation expenses, The prolonged period that trials are taking, The short supply of lawyers coupled with the growing demand for their servicesThe complexity of litigation is also increasing due to the following: The rising number of laws and regulations The increasing globalization of business The increasing use of technology in litigation these factors have made it difficult for most individuals and businesses to engage in the legal process and have resulted in the increasing demand of legal financing/consumers financing.
Increased Awareness of Litigation Funding
The Litigation Funding Investment Market Industry growth is also driven by an increase in awareness of litigation funding. A few years ago, litigation funding was not a well-known term to many people. Nevertheless, today, there is a growing trend, and many entities are becoming aware that they can finance their claims. The following are some of the ways that have increased awareness of financing legal claims. Some many litigation funding companies and firmsThe contact of individuals, businesses and entities with many successfully funded litigation that have been financed There has been an increase in media coverage of litigation funding the case, as more entities begin to know that they can finance their claims, the demand for the funds will continue to increase.
Favorable Legal Environment
Another major driver that propelled the growth of the Litigation Funding Investment Market Industry is the favorable legal environment. As of now, in many jurisdictions, there are laws and regulations that support and promote litigation funding. Such laws and regulations provide a satisfactory degree of certainty and predictability for litigation funders and investors. As a result, legal funding is becoming an increasingly attractive investment for more and more investors. Some of the most prominent legal market developments over the past several decades were as such: The widening asset cover for litigation funding. It has also become possible for funding litigation to be treated as an activity separate from offering loans. The Litigation Funding and Group Proceedings Act 2018 has been introduced in the UK. However, further enhancing the legal inducements that led to the growth of the global litigation-funding market will contribute to the industry’s growth in the future as well.
Litigation Funding Investment Market Segment Insights:
Litigation Funding Investment Market Type of Dispute Insights
Type of Dispute It refers to a key segmenting factor in the Litigation Funding Investment Market. The market is segmented into Commercial Disputes, Insurance Disputes, Intellectual Property Disputes, Construction Disputes, and Environmental Disputes. Being the largest segment in the market, the market has over 50% of the global market revenue. For this reason, commercial disputes arise from breaches of commercial contracts, business torts and other commercial matters. The second largest segment in the market is that of Insurance Disputes. This represents a total of about 25% of the global market revenue.Insurance disputes refer to those disagreements between the insurance holders and the company that had insured them. This covers the areas of coverage and claims. Intellectual Property Disputes are the third largest segment; they cover a total of approximately 15% of the global market revenue. When talking about this type of dispute, the meaning ranges from infringement of patents, trademarks, and copyrights to other property rights. The fourth largest segment covers approximately 10% of the global market revenue. This is the Construction disputes that range from one party to the other: contractor, contractor-bit, contractor-owner, owner-sub contractor and contractor-sub contractor.The last segment covers the smallest part of the whole market; this accounts for approximately 5% of the global market revenue. Environmental disputes range from environmental damage pollution, and other damages. The market growth for litigation funding investment in these segments is triggered by various factors: increasing complications of legal disputes between one party and the other, increasing cost of litigation, and the number of highly sophisticated investors looking for alternatives in their investments.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Litigation Funding Investment Market Stage of Funding Insights
The Litigation Funding Investment Market is segmented into Pre-Litigation Funding, Litigation Funding, and Post-Litigation Funding. The Litigation Funding segment is expected to dominate the market, holding a share of about 60% in 2023. The rise in the adversary complex, high-value litigation, and the growth in the adoption and awareness of financing solutions for plaintiffs are some of the major driving factors for the growth of this segment. The Pre-Litigation Funding segment is expected to expand at a moderate rate during the forecast period.The growth is attributed to the demand for financing the case preparation and investigation costs, which may lead to a substantial loss. There is a growing demand for investments in Intellectual Property, environmental law, glass, and mass tort cases. The Post-Litigation Funding segment is anticipated to grow at a moderate rate. The growth is due to the demand for the enforcement of judgment and an increase in the number of cases with positive outcomes.
Litigation Funding Investment Market Funding Structure Insights
The Litigation Funding Investment Market segmentation by Funding Structure includes Percentage of Recovery, Fixed Fee, and Combination of Percentage and Fee. Percentage of Recovery is the most common funding structure, accounting for over 60% of the global market revenue in 2023. In this structure, the funder receives a percentage of the client's recovery if the case is successful. Fixed Fee is another common structure, accounting for around 30% of the market. In this structure, the funder receives a fixed fee regardless of the outcome of the case.The combination of Percentage and Fee is a hybrid structure that combines elements of both Percentage of Recovery and Fixed Fee. This structure is becoming increasingly popular, as it allows funders to share in the upside of successful cases while also providing some downside protection. The Litigation Funding Investment Market is expected to grow significantly in the coming years, driven by increasing demand from law firms and corporations seeking to finance complex and expensive litigation.
Litigation Funding Investment Market Litigation Outcome Insights
The Litigation Outcome segment is a crucial aspect of the Litigation Funding Investment Market. It encompasses three primary categories: Successful Litigation, Unsuccessful Litigation, and Settled Litigation. In 2023, the Successful Litigation segment held the largest market share, driven by the increasing number of successful litigation cases globally. The Unsuccessful Litigation segment, however, is expected to witness significant growth in the coming years due to the rising number of complex and high-stakes legal disputes. Additionally, the Settled Litigation segment is gaining traction as parties increasingly opt for out-of-court settlements to resolve disputes efficiently.This growth is attributed to factors such as the increasing demand for funding in complex and expensive litigation cases, the growing awareness of litigation funding, and the involvement of institutional investors in the market.
Litigation Funding Investment Market Regional Insights
The Litigation Funding Investment Market segmentation by region includes North America, Europe, APAC, South America, and MEA. North America is expected to hold the largest market share in 2023 and is projected to continue its dominance throughout the forecast period. The growth of the Litigation Funding Investment Market in this region is primarily attributed to the increasing number of lawsuits, the presence of well-established legal frameworks, and the growing awareness of litigation funding among law firms and corporations. Europe is expected to be the second-largest market for Litigation Funding Investment, followed by APAC.The APAC region is expected to witness significant growth in the Litigation Funding Investment Market due to the increasing demand for litigation funding from emerging economies such as China and India. South America and MEA are expected to have a smaller market share but are expected to grow steadily over the forecast period.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Litigation Funding Investment Market Key Players And Competitive Insights:
There is tough competition in the Ligation Funding Investment Market industry. Major players often focus on differentiating their products and services and on building stronger relationships with their customers. Leading Litigation Funding, Investment Market players are investing in research and development in order to design efficient products. In addition, the Litigation Funding Investment Market is increasingly competitive, with more players entering the market. Burford Capital is one of the leading global providers of litigation finance, thanks to its long history of financing law firms and stakeholders. The larger financier of the company in terms of size included several top law firms and top companies in the world. The company also had a strong track record of success, as it had recovered more than $2 billion in investment returns.
Headquartered in New York City, the firm has other offices in London, Singapore and Chicago. The other stakeholders in this industry include the Gerchen Keller Capital. This company provides funding to law firms and other stakeholders involved in commercial litigations instead of key stakes. The company has well-qualified professionals who have a better understanding of the legal system. Gerchen Keller Capital has also made a big success as it has also recovered more than $1 billion in favour of its customers. The company is based in New York and has branches in London and San Francisco.
Key Companies in the Litigation Funding Investment Market Include:
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Woodsford Litigation Funding
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Fortress Investment Group
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Fairmount Funds Management
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Aquila Litigation Fund
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Omni Bridgeway
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Burford Capital
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Epiq
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Validity Finance
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IMF Bentham
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Pretium Law Funding
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Harbour Litigation Funding
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Donerail Group
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Echelon Capital Partners
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Rosewood Legal Finance
Litigation Funding Investment Industry Developments
The Litigation Funding Investment Market is experiencing steady growth, driven by the increasing complexity and cost of litigation. The market is expected to reach a value of USD 19.39 billion in 2023 and USD 40.4 billion by 2032, exhibiting a CAGR of 8.49% over the forecast period (2023-2032).Recent news developments indicate a growing appetite for litigation funding among investors. In 2023, Burford Capital, a leading litigation funder, announced a record USD 4.6 billion in committed capital, reflecting the increasing attractiveness of the asset class. Additionally, the emergence of new players in the market, such as Parabellum Capital and Therium Capital Management, is intensifying competition and driving innovation.The market is characterized by a diverse range of participants, including institutional investors, hedge funds, family offices, and high-net-worth individuals. These investors are increasingly seeking alternative investment strategies with attractive risk-adjusted returns, making litigation funding an appealing option. The growth of the market is also supported by favorable regulatory frameworks in key jurisdictions, such as the UK and the US, which provide clarity and certainty for investors.
Litigation Funding Investment Market Segmentation Insights
Litigation Funding Investment Market Type of Dispute Outlook
Litigation Funding Investment Market Stage of Funding Outlook
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Pre-Litigation Funding
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Litigation Funding
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Post-Litigation Funding
Litigation Funding Investment Market Funding Structure Outlook
Litigation Funding Investment Market Litigation Outcome Outlook
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Successful Litigation
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Unsuccessful Litigation
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Settled Litigation
Litigation Funding Investment Market Regional Outlook
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North America
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Europe
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South America
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Asia Pacific
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Middle East and Africa
| Report Attribute/Metric |
Details |
| Market Size 2022 |
17.9 (USD Billion) |
| Market Size 2023 |
19.4 (USD Billion) |
| Market Size 2032 |
40.4 (USD Billion) |
| Compound Annual Growth Rate (CAGR) |
9.6% (2024 - 2032) |
| Report Coverage |
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Base Year |
2023 |
| Market Forecast Period |
2024 - 2032 |
| Historical Data |
2019 - 2023 |
| Market Forecast Units |
USD Billion |
| Key Companies Profiled |
Woodsford Litigation Funding, Fortress Investment Group, Fairmount Funds Management, Aquila Litigation Fund, Omni Bridgeway, Burford Capital, Epiq, Validity Finance, IMF Bentham, Pretium Law Funding, Harbour Litigation Funding, Donerail Group, Echelon Capital Partners, Rosewood Legal Finance |
| Segments Covered |
Type of Dispute, Stage of Funding, Funding Structure, Litigation Outcome, Regional |
| Key Market Opportunities |
Growing Demand for Litigation Funding.Increased Access to Justice.Expansion into Emerging Markets.Technological Advancements.Diversification of Funding Sources. |
| Key Market Dynamics |
Growing legal costs and complexity of litigationIncreased availability of capital for litigation funding.The emergence of new funding models and investors.Regulatory changes and legal reforms.Expansion into new markets and jurisdictions. |
| Countries Covered |
North America, Europe, APAC, South America, MEA |
Frequently Asked Questions (FAQ) :
The Litigation Funding Investment Market is expected to reach USD 19.4 billion in 2023 and is projected to grow at a CAGR of 9.6% to reach USD 40.4 billion by 2032.
North America is expected to hold the largest market share in the Litigation Funding Investment Market, owing to the presence of a large number of law firms and litigation funders, as well as a favorable regulatory environment.
The key growth drivers of the Litigation Funding Investment Market include the increasing demand for litigation funding from law firms and corporations, the rising cost of litigation, and the growing awareness of litigation funding as a viable alternative to traditional financing.
The key competitors in the Litigation Funding Investment Market include Burford Capital, Harbour Litigation Funding, Bentham IMF, Omni Bridgeway, and Augusta Ventures.
Litigation Funding Investment is used to finance a wide range of legal disputes, including commercial litigation, intellectual property litigation, and mass torts.
The key trends in the Litigation Funding Investment Market include the increasing use of data analytics to assess the merits of cases, the growing popularity of portfolio funding, and the emergence of new regulatory frameworks.
The challenges facing the Litigation Funding Investment Market include the lack of regulation in some jurisdictions, the potential for conflicts of interest, and the risk of adverse publicity.
The Litigation Funding Investment Market is expected to grow at a CAGR of 9.6% from 2023 to 2032.
The key factors driving the growth of the Litigation Funding Investment Market include the increasing demand for litigation funding from law firms and corporations, the rising cost of litigation, and the growing awareness of litigation funding as a viable alternative to traditional financing.
The key opportunities for growth in the Litigation Funding Investment Market include the expansion into new markets, the development of new products and services, and the adoption of new technologies.
