Bench Walk, PACCAR Judgment, & Litigation Finance

Disclaimer: This interview is for informational purposes only and should not be relied upon as a basis for investment decisions. In Practise is an independent publisher and all opinions expressed by guests are solely their own opinions and do not reflect the opinion of In Practise.

I'm looking forward to our conversation. We've been studying Litigation Finance for four or five years now, so we have a decent understanding of it. We are big fans of the industry and are eager to learn more about what you've learned over the years, about Bench Walk, and how the industry is evolving. A lot has happened recently. It would be great to first understand more about your background and how you ended up in Litigation Finance.

Yes, it's quite a story. I'm originally from Turkey and had I told my father that I wanted to be a litigation funder when I grew up, he would have disowned me. I studied law in Turkey, then moved here to pursue a Masters in International Relations. However, I found that it wasn't for me due to my preference for clear-cut solutions and my dislike for politics.

Consequently, I went to Nottingham Law School and did a law conversion course. Despite my good grades, it took me a while to secure a training contract due to my unconventional background. Eventually, I started working at a top immigration law firm, even though my electives were in corporate law.

During my work experience, I discovered my knack for numbers and developed an interest in risk analysis. This led to me being headhunted by FirstAssist, an MGA, in reinsurance. I worked in their insurance department, focusing on after-the-event insurance, and became a chartered insurer in the process.

FirstAssist was then acquired by Burford Capital, which transformed it into a litigation funding company two years later. I was moved to their funding team, marking my entry into the field of litigation funding. My primary responsibilities involved insurance and due diligence.

After seven years at Burford Capital, I moved to Gallagher to work as an insurance broker. I wanted to do more origination work and leverage my insurance background. A year and a half later, in 2018, I was headhunted by four different litigation funders and decided to join Bench Walk as Vice President. I am now the Global Head.

Could you provide more details? So, Burford bought FirstAssist, which was an MGA, and they were solely involved in legal financing and legal insurance?

Yes, FirstAssist used to provide after-the-event insurance, and that's how Burford entered the UK market. It was the largest and most profitable after-the-event insurance company. Instead of starting their own office, Burford acquired FirstAssist and changed its name.

I still remember when it was Burford Capital. I witnessed how it started up in London, which was quite impressive. We were initially located in East Croydon, right next to Travel Lodge. It was an interesting place to start a global litigation funder. Later, we moved to Cheapside.

Could you explain how the insurance business worked at FirstAssist?

I believe insurance and litigation funding are quite similar. In insurance, we consider the risk and calculate pricing based on the prospects of the case, its duration, and its complexities. This is how we used to calculate premiums. In litigation funding, I review a case, and I used to review approximately 400 cases a year at Burford. These included insolvency, commercial litigation, and personal injury, arbitration. Reviewing many cases simultaneously honed my risk assessment skills. The primary difference between insurance and litigation funding is recoverability.

In insurance, I receive my premium regardless of whether the client gets the money or not. However, in litigation funding, I recover from the damages obtained from the other side. The only difference is looking at enforcement risk in litigation funding, which is not a consideration in insurance. Additionally, in litigation funding, we consider the potential damages because we receive a percentage or multiplier of the money we invest. In insurance, this is not a concern as we have fixed stages and recovery amounts.

How did the insurance work for legal expenses? 

The process was quite similar to the current one. We used to review the seed cases and write an investment memo. If we decided to fund the case, we would send it to our representatives in Munich. Munich would review the documents, as would our New York office. If they were satisfied with the risk, we would insure it. In underwriting, we had the right to 'hold the pen,' meaning we could insure up to a certain amount without approval. If it was for less than two million coverage, we would seek approval. This is similar to what we do now. If I think an investment is worth it, I write an investment memo explaining why it's a good case, what the risks are, why I think it should be funded, and what our terms should be. I also explain how I calculate pricing. So, it's very similar.

Currently, what percentage of legal funding cases, where a law firm brings a case to a funder to fund the law firm's expenses, are insured? Do you have a rough estimate for the UK market?

It really depends on whether it's a UK case. For instance, if it's a case where there is insolvency, we always get after-the-event insurance because there's always a risk of the defendant's costs. We use insurance in different ways. We use it to get after-the-event insurance to cover our risk of defendant's cost payment. This is very common in competition class actions in the UK and also in litigation cases. We sometimes insure our capital with an insurance company for a substantial amount, as well as portfolio insurance. We sometimes get insurance to cover security for cost risk, which we call an anti-avoidance endorsement. So, there are different ways we use insurance to transfer risk to insurance companies.

What's the most common type of insurance?

The most common type is after-the-event insurance.

And what percentage of cases do you think currently have insurance?

The need for insurance really depends on the case's location. If it's a UK-based case, almost all of them are insured. In the US, insurance isn't necessary because there's no risk for defendant costs. In continental Europe and arbitration cases, we usually don't get insurance. So, it's highly dependent on the jurisdiction, but in the UK, it's almost always 100%.

Is that because you have to cover a defendant's cost if you lose?

Yes, it also depends on the specific legal implications. For instance, in the US, you don't have the burden to pay the other side, but in other jurisdictions, you do. Each jurisdiction is different.

So, the insurance is primarily to cover the defendant's costs. If I'm a funder and I put down 10 million on a case, I risk losing that 10 million. I would then buy insurance to cover the defendant's claim.

Exactly. After-the-event insurance covers all legal fees, including lawyers and expert fees for the client. However, if we lose, the court might order us to pay the defendant's costs.

Consider competition cases, where costs can reach up to 30 million. We get insurance to cover these costs if the case is unsuccessful. The insurance then pays the defendant's costs and we lose our investment. So, when you get after-the-event insurance, it's essentially hedging the client's costs and the defendant's costs for the litigation funder.

How expensive is that? If you have a 20% or 30% IRR, how much does that reduce your IRR for the case?

It really depends. Since we're in litigation funding, we try to get insurers to agree to a staged premium. It's usually 15% to 20% upfront and there's a back end. The back end is deferred and contingent, meaning it's deferred until the end of the trial. You only pay based on the success of the case. If the case is unsuccessful, we don't pay the last stage, which is typically 40%. If the case is successful, we pay that premium.

That's quite expensive.

Yes, it is indeed expensive.

So, if I invest 10 million in a case with a 30% IRR, after insurance costs, I might end up with a 15% or 20% IRR.

It really depends. For example, I might have a 40 million portfolio case, but it only requires 10 million ATE insurance. The ATE insurance cost is calculated based on the coverage limit I'm looking for, rather than the amount I've invested.

Does that mean the US is a more attractive jurisdiction for funding than the UK, considering you have to pay the defendant's costs and buy insurance in the UK?

I wouldn't say so. Insurance provides good access for these cases. To be honest, we've never had a straightforward case. If it were straightforward, they probably wouldn't need funding. So, insurance is beneficial for complex class action and competition cases. These cases can't proceed without litigation funding because we have to pay for the entire class. ATE Insurance provides a safety net and protects us from losses.

Broadly speaking, how do insurance companies view litigation funding?

I believe that insurance companies hold us in high regard. When you approach an insurance company directly, they tend to perform more due diligence. However, if you're a reputable litigation funder, and you tell an insurance company that you're investing 40 million in a non-recourse loan, meaning if the case is unsuccessful, you lose all your investment, they are more likely to insure. The level of respect is higher for reputable funders. It's easier for insurance companies when reputable funders are involved because a lot of the due diligence has already been done. We review the case, consult with our investors, hire an external lawyer, and probably spend around £300,000 on due diligence before investing in a case. So, if we tell them we're investing, it simplifies things for the insurance company, doesn't it?

The reason I ask is because there have been instances, particularly in the US, where insurance companies have expressed their dislike for litigation funds, claiming that they inflate their claims cost.

That's an interesting point. On one hand, insurance companies have to pay us. But on the other hand, these same insurance companies have other branches, like after-the-event insurance arms, that pay for them. That's how financing works on both sides.

Do you think that some of these insurance companies, despite having after-the-event arms where funders are the clients, are against litigation funding? There was a report, I can't recall the insurer's name, that claimed funding was detrimental because it increased claims cost and drove more litigation worldwide.

That argument always comes up. The same discussion is happening in Europe where they're trying to halt litigation funding because large companies are unhappy with it. However, if there's wrongdoing, it must be paid for. If you're an insurance company, which I've been for a while, you shouldn't take that risk. Insurance is a risk-taking business.

Can you share your thoughts on the recent PACCAR judgment? Could you explain it to me as if I were a five-year-old, please?

The PACCAR judgment essentially states that if you're a litigation funder and you want to get a substantial percentage on a DBA from clients, your agreement is unenforceable. There's been confusion around this, with people saying that if you get a percentage of damages and it's more than 40%, it's unenforceable.

When the decision came, which we expected, the Supreme Court judges didn't allow the barristers funded by litigation to defend the case. It was strange because the barristers appointed by litigation funders couldn't even manage to say one sentence. They weren't allowed.

We hoped that something against litigation funders would come out, which it did. However, litigation funding is very changeable. So we increased our multiplier and we get the same money again. They said, you can't get a DBA; percentages of damages are not acceptable.

I've seen some lawyers panicking, thinking this is the end of the litigation funding industry. We simply changed our litigation funding agreement and switched to a multiplier. The only people who profited from this decision were lawyers and barristers, because we ended up getting numerous emails from lawyers offering to change our LFA and voices offering to review all our documents.

So you just modified your agreement?

We didn't have many to begin with. We were fortunate because we mostly had to go on a multiplier. As soon as it went to the Supreme Court, we decided to put everything on a multiplier. We only had five litigation agreements affected by that decision, and we slightly changed the financial terms, and it's all fine now.

So you can easily go back and modify?

We just changed your LFA.

What's your perspective on the impact of this regulation?

Initially, I had no idea. I think it was just trying to cause some chaos, maybe. We thought it was a strange decision because this is a free market and we agree it is access to justice, but it's incredibly expensive to bring those claims forward.

When we got the decision, we kind of expected it, but we were a bit shocked. However, if you're a good litigation funder, you always have a plan B. We already had an action plan in place saying, if this decision comes, we are going to change it to this multiplier and it's all going to be fine. And that's exactly what we did in a matter of a few days.

Didn't the clients push back?

Clients need our money to bring these cases forward. For instance, let's think about the Dieselgate cases. The individuals are trying to get £10,000 per car, and these people can't bring these cases forward without our financial support. They were still going to get what they deserve. But the relationship is usually between the lawyer and the litigation funder.

How do you think regulation in the future will change the industry?

I believe all the pricing will change. There were many people alarmed, thinking that this was the end of our funding. However, that wasn't the case. We are still receiving many compelling competition cases. We simply adjusted our pricing and carried on as usual. This is such a world, if you are adaptable and always have a contingency plan, you will survive. However, if you're a litigation funder who isn't financially savvy, lacks plans, or isn't adaptable, then you will be one of those litigation funders that can't survive.

How do you anticipate the IRR will change if you switch from DBA to multiples?

The change to multiple didn't impact the IRR.

It seems like a shockwave, but if you can adjust the agreements swiftly, then what's the impact?

I didn't even comment on it because anyone who knows about litigation funding, and even those who don't, started posting on LinkedIn expressing their alarm. And I say, come on, there are worse things in the world. We simply adjust our terms and move on.

Are there any other regulations you think could interfere with the relationship between the funder and the law firm?

The EU is considering limiting the recoverability of litigation funding up to certain points. From what I've heard from my friends in Europe, it's unlikely to pass the EU parliament. Large European companies like Mastercard, Visa, and Volkswagen are the ones pushing for this, saying they don't want litigation funders. So there's one regulation currently under discussion in the EU parliament. There was also a big fuss about changes in the rules for litigation funders in state arbitration cases and in antitrust cases. But when the rules came out, they were the same rules we were already following; disclosure, conflict. They just put them on paper and we completely agree with the changes they've made.

It's interesting that you mentioned Visa and Mastercard. So they're actually against funders because they believe they will bring them litigation?

Yes, and they may have to pay out a substantial amount of money. For example, Volkswagen won cases that Therium was funding, they settled the case because it was clear they were lying about the diesel scandal. So they had to pay a substantial amount to the client. It's the same with other companies that were misleading the public to sell more cars. Now the financial consequences are catching up with them. So they are trying to use their lobbying power in the EU parliament to block litigation funding.

But it's interesting because some parts of the industry, like what Burford does for example, is trying to unlock cases from the balance sheets of corporates. Then these large corporates, like Cisco, Visa, Mastercard, who are doing things they shouldn't be, are lobbying against it.

Let's see who will emerge victorious.

Could you share more about Bench Walk's portfolio today? How is it divided between case types, patterns, antitrust, and geography?  

The cases that keep us busiest these days are class and competition cases. They involve significant liability, and we need to work on damages. We're handling a tax case and even secured the mandate on the carriage fight. We were involved in a carriage fight with Therium and the court decided to follow Bench Walk. Therium lost the fight, which pleased us, but our joy lasted less than 24 hours because the PACCAR decision came the next day.

We're also working on major cases like Mastercard and Visa, all the emission cases here, and an ESG case against motor companies. We're handling investor space cases. We have five cases in our portfolio, soon to be six as we're closing another deal. We're quite active in continental Europe, funding cases in Holland, Belgium, Italy, France, Germany, and Spain. Adrian and I are the only two litigation funders ranked in the UK and Europe. No other UK companies have been ranked in Europe.

Our US business is also keeping us very busy. We tend to see securities actions and normal litigation cases there.

What percentage of your case portfolio is in the UK versus Europe?

If you combine the UK and Europe, I'd say about 70% of our business comes from there and 30% from the US. However, the US portion is growing since we hired a person two years ago to bring in cases from New York, and he's doing an excellent job.

Is your funding mainly for legal expenses, or do you also fund off the balance sheet, your corporate assets?

We haven't funded in-house lawyers or companies. It's a challenging area to enter. However, we have funded portfolios. We completed a 200 million secondary market sale with another massive litigation funder, bringing 200 million of their risk into our book. We sometimes fund law firms, like in Italy, where we provided 20 million for them to invest in cases. We also gave a portfolio facility to an Australian law firm, whose details I can't disclose. Our approach is simple. If a case comes and it's a good one, we invest in it.

What's the average or median size of the investment in the portfolio?

I would say the average median size is between 15 to 20 million. That's the amount of money we invest.

On a single case or on a portfolio?

That could be on a single case. But it really varies. We have one case where we invested £500,000, another where we put in one million, another where we invested 50 million, and another where we put 200 million on a secondary market sale. So, we deal with a wide range of cases.

If you were to line up all the cases, what would be the median value?

We've had cases worth as much as 200 million, but the median would be around 10 to 15 million.

That certainly skews the average.  

Yes.

Even so, 15 million seems quite large. I believe Burford, for instance, has an average of $20 to $25 million.

Burford may claim that, but they won't even consider a case if the damages are less than, say, $70 million. We, on the other hand, start reviewing cases where the damages are $10 million. This might be too small for Burford. I still have friends at Burford who sometimes refer smaller cases to me. We're not strictly focused on large portfolios. If a case is good, we're interested in investing. This approach gives us a spread of money coming in and going out. If you invest a large sum in one portfolio, it might take a long time to see a return. But if you invest in smaller cases, which usually take 18 months to three years, we can see a return quicker.

And the 200 million case, was that a portfolio?

Yes, it was from a litigation funded secondary market sale.

How do you originate your cases?

When I first started, I only knew three lawyers, who were my friends from law school. I attended every event I could, networked extensively, and sent countless emails. I also reached out to lawyers I found online. I've been fortunate because having a background in litigation funding for over 10 years has given me a reputation in the market. I not only source cases, but I also conduct due diligence, handle documents, and sometimes do LFAs and the closing of the deals. If I can't fund a case, I'll say so. If I can, I'll give a timeline. We don't even have a marketing team. We rank number one in Chambers and Partners. We've invested nearly $1 billion. It's all about reputation. If a law firm likes working with me, they'll refer me to their colleagues. I've even received US cases from UK firms because they liked working with me.

So, 100% of your cases are inbound, coming from referrals or direct contacts?

Our referrals come primarily from law firms. When I first started at Bench Walk, Adrian told me that most of our cases were coming through brokers and he wanted to shift that. Now, the percentage of cases coming to us directly from lawyers versus brokers is 80% to 20%.

Could you explain the difference in the type of cases you receive from a broker versus a law firm?

The cases are quite similar. However, if a case comes from a broker, it's usually sent to more than one litigation funder. We do enjoy working with some brokers, they do a great job. But if a case comes from a lawyer, it means that we have already established a relationship with them. I often receive WhatsApp messages from lawyers asking if we can fund a case and if we can pitch together. Having direct access to a decision maker is a great advantage. If I'm unsure about a case, I ask Adrian or Stuart, who are part of our investment committee. If they say yes, the deal is done. I don't think anyone in the market can match our speed. We are incredibly quick.

Do you conduct all of your due diligence in-house, or do you outsource some of it?

Initial due diligence is done in-house by myself and three team members. We have a due diligence director in the US named Cynthia. If we think a case has potential, we send it to her for a quick review. For detailed due diligence, we instruct an external lawyer or a barrister to review the case for us.

If I'm a law firm and I send you a case, how long does it take for you to give me a price or a bid? What is the process on your end?

The time frame varies. Sometimes we receive vague one-page submissions with no damage calculations, so I have to ask for more information. But let me give you a live example. A few weeks ago, a lawyer brought a case to our office on a Friday. They had all the necessary documents and even brought their client. By the end of the meeting, I told them I was likely to fund their case. Over the weekend, I reviewed the damages report and sent it to Cynthia, our due diligence director. She gave positive feedback, so we proceeded. By Tuesday, we sent our terms. We are currently negotiating terms and are nearly finished with signing the Litigation Funding Agreement (LFA). Our external due diligence only lasts for two weeks. Our exclusivity period is one month, which includes two weeks for external due diligence and two weeks for drafting the LFA. If we like a case, we pursue it aggressively.

What does the external due diligence process entail?

They review all the documents that lawyers send us. These are typically similar partners who have experience in the same area or a barrister. They interview the client and the lawyer and prepare a six-page memo stating whether this is a good case or not.

So, is it a funding partner who does that?

For instance, let's say I have a case and I ask a barrister from a chambers to do the due diligence for us.

What if it's in a jurisdiction where you don't have expertise? 

We have experience in the US, but let's say it's in Georgia, we wouldn't fund it. We always try to go with jurisdictions we are familiar with. If we don't have experience in a place like Spain, we would instruct a top Spanish lawyer to do it for us. However, if I have suspicions about the jurisdiction, then I won't fund that case.

That's interesting because I think Burford has a lot of their expertise internally for all this due diligence. They don't seem to outsource much. How do you weigh up having expertise internally versus externally?

Different situations call for different approaches. Consider this, if you have a 100 people and you pay 200 grand per head, is your pricing going to be more expensive? You are in a fancy office and you have two qualified lawyers doing the work for you. Compare that to having 11 people globally, in a normal office, and see how it affects your pricing and speed.

So, would you say that you're cheaper than Burford then?

Our clients have said so. Some large law firms who were working with Burford have turned to Bench Walk, saying they find it very difficult right now. We always say we are a financial service provider rather than a legal service provider. Some of our competitors say they are legal service providers and employ a lot of lawyers. We don't want to be one of those. We want to keep the team small and efficient, have the decision makers. If I want to fund a case, then I instruct a top lawyer to do the due diligence for me. It is cheaper than paying someone a 200 grand a year salary because they do that work for £10,000 for me.

So, you outsource the legal due diligence to the barristers?

Yes, and we don't have the backlog of cases that in-house teams who go into detailed due diligence have to deal with. If I have a competition case, I instruct a top competition barrister. If I have an insolvency case, then I go to an insolvency law firm and ask them to look at the case for me. By delegating, I believe I get better quality, it's faster, I'm not overloading people, and it's cheaper for the client.

Does the barrister take an upfront fee or do they get paid on contingency?

No, we just pay them a one-off fee.

So, it must be cheaper. Burford has like a hundred lawyers in London and New York, and they're obviously top lawyers.

As I mentioned earlier, the structure at Omni Bridgeway is similar. However, if I believe a case in Holland is promising and I want a review, I can engage a top Dutch law firm, which we've done before. There's also a marketing aspect to this. For instance, we had a situation in Switzerland where I instructed a law firm from Geneva to examine a case. They did an excellent job and a week later, they contacted me to discuss four more cases. So, it's a reciprocal relationship.

So, you rely heavily on their expertise?

Yes, we do. That's why it's crucial for us to receive approval from the client and to examine the background of the firm we're instructing. We prefer to engage experts in their respective fields, like Stephen Fietta in arbitration or Patrick Pearsell, of Allen & Overy. These are the people we instruct for due diligence.

I suppose other funders, like Therium and Augusta, employ a similar strategy?

I've not heard about their methods. Therium, for instance, tried to handle everything in-house. Augusta, if they still exist, once employed 150 lawyers to manage everything internally, but they soon realized it wasn't cost-effective. They let go of all their lawyers in one day and reverted to the other model. They communicated this to their team members.

I believe there's great value in having a lean team of bright individuals. If you're an originator and you're unfamiliar with due diligence, as is the case with some of our competitors, you might promise the lawyer that you'll handle everything and then pass it on to a due diligence person. They ask questions, then it goes to the investment committee. These due diligence people, who've never met before, have weekly or monthly calls. They have their own questions.

The origination then goes back to the client. If you have a team of 50 monitoring the activities daily, it's a different structure. We don't believe it's cost-effective, but it works for some funders.

How much cheaper would you say Bench Walk is? If a law firm sent the same case to Bench Walk and Burford, what do you think the difference in pricing would be, or the multiple you'd offer?

I can't comment on Burford's pricing as they are generally more expensive due to their size and other factors. I don't know what my competitors charge, so I don't want to provide misleading information. However, I've had a few lawyers tell me that, out of all the funders, we were the most reasonable. I've heard this about five times. But of course, they didn't disclose the competitors' pricing because it wouldn't be appropriate to do so.

Could Bench Walk be, say, 10% to 20% cheaper?

Yes.

With a team of 11 people, how much can you deploy per year?

We don't have a limit if we come across a really good case. Currently, we have over a billion in assets under management. If we like a case, we fund it. We raise money. We are privileged because we have a strong track record. For instance, we funded the Tinder case with 50 million and it settled for 487 million. Everyone was pleased. We have a good track record of successful cases and settlements. We've had investors who wanted to invest and we said, "Wait, let's use this money first, then we will continue raising our funds." But we don't have a limit of, say, 100 million and then we have to wait another year.

Could you deploy a billion a year?

Yes, definitely. If we have an amazing year, we will go to market straight away, which is usually handled by Stuart Grant. We will invest that money and raise additional funds immediately.

So, it seems like Bench Walk is more financial than legal services.

It is, and our investors don't decide which case we should fund. It is Stuart and Adrian. If they approve a case, the case gets funded and the investors put their money behind Bench Walk.

You raise money when a case comes up?

We have the capital, then the money that has been raised is used. So, we don't raise funds on a case-by-case basis. We already have money raised.

It's interesting because it's a different model from what Burford does. They hire many people, and spend a lot. I think their operating costs are around $100 million a year.

Yes, it's a different model. And it has been working for Burford for a long time.

Why is it working for them?

They were the first ones in the market, I believe, and I have a lot of respect for Chris Bogart, Jonathan Molot, as I used to work with them. They are incredibly intelligent and see the opportunity. But from my perspective, the market is changing right now. When Burford came to market, there was only one structure; employ lots of lawyers and that's how we should do it. I think Bench Walk came to market with a totally different structure. And we are showing, hopefully, the competitors and the other markets, people who want to join litigation funding, that you don't have to have a massive team of litigation funders and lots of offices around the world, to be a good litigation funder. Speed and certainty; that's it.

Let's say I give you a 10 million case, a competition law case, and send it to Bench Walk. You send it out to your barrister, your competition lawyer, they say it's great, you fund it. Let's say it's a five-year case, it drags on. When more information comes out, it gets an appeal or a trial or something happens, what do you do?

Unlike some litigation funders who have large monitoring teams, our approach is different. We rely heavily on trust and the quality of the lawyer. If I don't think the lawyer is competent, I won't fund the case, regardless of how promising it may seem. This is because I'm entrusting my money to that lawyer.

Every month, we receive a brief report on any changes in the case. If everything is going smoothly, we let the lawyers do their job. However, if there are potential issues, such as those highlighted in an expert report, we review the report and ask the lawyers for their advice.

For example, we had one unusual case that was successfully settled by highly competent lawyers. We don't interfere in the lawyers' decisions. If I were such a great lawyer, I wouldn't be a funder. There's a reason why he's a lawyer at a law firm and I chose to step back and do this work.

We respect the people who secure the clients and work hard to bring the case. Some of our competitors try to act as the lawyers of the case, but they are not.

Once the original legal due diligence is complete, that person doesn't get involved for the rest of the case?

Correct. We trust the law firm. Their job only lasts for two weeks, during which they inform me if, as a litigation funder, they would risk their money on the case. After that, they're done. We receive a basic report stating that everything is going well. We don't bother the lawyers. If a lawyer starts bothering me, I would probably stop funding them. They should be the ones who know the legal aspects, not me.

You really trust the law firm then?

Absolutely. If I don't trust them, I won't fund the case. We receive cases from all over the world, so if I don't think a lawyer is good, I won't fund that case.

Are there any cases that you think you can't fund due to your structure, like some of these larger anti-trust deals or longer cases like YPF at Burford or Sysco?

We don't have a limit. We've put $50 million on one case we're currently working on. It's not the amount of money required for a case that stops us, but the jurisdiction of the case. There are some jurisdictions that Burford and Omni Bridgeway might be comfortable with, but we are not.

Those are the types of cases we would choose not to fund. If a case requires $150 million in funding and we don't have it at the time, we could co-fund with another litigation funder. But usually, the decisive factor isn't the amount, but the factors included in the case. There are some cases that Burford can handle because they have an asset tracing team, which we don't. So our appetite for certain cases changes accordingly.

What are the main reasons law firms choose Bench Walk over Burford? You mentioned price.

We did discuss pricing, but it's more than just that. One law firm told me that our pricing was satisfactory, but they chose to work with us because they like the people Bench Walk has. If they encounter a problem or need to increase their budget, they can call us and we will assist. I always say that litigation funding is a relationship business. Some marriages don't last as long as funding a case does. We've been in this field for a long time and some law firms choose us because of that.  

Everyone enjoys working with you. That's why they send you the deals.

Yes, exactly. They tell me they can't believe we only have 11 people in the front office. My front office team consists of five people, the rest are in the back office. So globally, five people are doing this, which I think is quite impressive.

Who do you typically compete against in cases? Who's your biggest competitor in the UK?

It really depends on the type of case and the jurisdiction. If I'm dealing with a competition class action, I might see Harbour popping up. Woodsford is involved in some securities cases, so there's a balance. Sometimes, in smaller cases, they are interested in similar matters. If I'm working on big investor state cases, I might have Omni Bridgeway as a competitor. If it's based in the US, I'm competing against Parabellum and Burford Capital. If it's Europe, I'm competing against smaller litigation funds, like Nivalion, based on that jurisdiction and Omni Bridgeway. So it really depends on the type and jurisdiction of the case.

Why do they choose these other smaller funders? How can they compete with Bench Walk?

The cases in Europe are usually smaller and don't require as much funding. For instance, in Holland and Sweden, they have their own litigation funders. There is another funder, Nivalion, based in Switzerland and continental Europe. They focus on their cases and like to work with us for the same reasons our UK and US lawyers do.

How do you approach general counsels to unlock or finance their litigation, rather than only relying on law firms?

I believe we should primarily reach out to CFOs instead of GCs. GCs tend to focus on the law, but when you talk about numbers with CFOs, they are the ones who are genuinely interested in learning more about litigation funding. I consider myself fortunate because I'm originally from Turkey and the only Turkish-speaking litigation funder in the world. My main job is based here in New York. However, I receive many calls from Turkish companies asking for help with their cases. I've noticed that these countries have a greater appetite for litigation funding than Western countries. This may be due to financial reasons. For instance, if a Turkish company was to sue one of the states, considering the currency difference, they genuinely need a funder. But when you think about Siemens, they don't need it.

Are you currently approaching CFOs, or do you rely on law firms coming to you?

We are dealing with law firms. They are bringing us cases and keeping us very busy. However, when I go to Turkey, I always meet with CFOs, CEOs, and GCs because they have really good cases. I also handle cases based in continental Europe and the US. I find these types of matters interesting. Just now, while I was talking with you, I received two new cases.

Where do you see the most attractive avenues for growth in the industry?  

Continental Europe is becoming quite an interesting area. I know Portugal is changing their law to make competition cases more friendly. They have opened their doors to litigation funding. The UK is doing very well with litigation funding at the moment. We are receiving many cases. The US is also picking up. To be honest, when I went to the US, I was surprised at how many lawyers, compared to the UK, are less aware of litigation funding. So, the US is changing its view. Europe will probably start to catch up soon because there's a lot of potential there. There are many big companies, class actions, and competitions. I think that's where the growth area will be.

How much securitization of these assets are you seeing in the UK today? Are you securitizing parts of your portfolio, or is that still in the early stages?

The main needs will be in the UK.

This has been great. Thank you very much for your time.