What was your point of entry to litigation finance?
“It’s the first time in the history of the United States that a nonlawyer can own a law firm. In some contexts, it’s good to have a CEO or finance person in a firm, looking at it from a commonsense business perspective.”
Founder and CEO
Pravati Capital

You’ve been in the space for a long time. How have you seen litigation finance evolve?
Law firms are now much more open to litigation finance and law firm financing. We’ve also seen a big change between nonrecourse and recourse contracts over the last two or three years as many funders have now seen how investments can go sideways. What we’ve seen is the acceptance of capital in the US and UK legal markets.
It’s been tremendous to watch how it used to take months to raise $100,000, and then another four months to convince and educate attorneys it was legal to use capital. Now we’re raising hundreds of millions of dollars and we’re putting that kind of money out on a regular basis.
Let’s talk a little bit about alternative business structures. Your headquarters are in Arizona, which gives you a novel perspective. What’s the outlook on the ABS front?
Where do you see things going over the next five years?
It’s going to continue to grow. Law firms are much better off working with a traditional litigation funder than hedge funds. A hedge fund will outsource case underwriting to a third-party law firm to review; now you have more of a privilege issue. Now you’re sharing nondisclosed data with a third-party law firm to underwrite, which creates significant nondisclosure data leakage.
Law firms and commercial entities seeking capital for a case dispute and investment should seek a bona fide litigation finance company that will keep case data confidential from a legal underwriting perspective, as well as confidentiality in the investment community. Pravati is a unique private equity company in that it underwrites and finances investments all in house. We see this industry niche continue to grow — we believe there will be more attrition fallout of investment firms as origination of assets and collateral management will be more involved and will require higher staffing needs.