For litigation finance firms, finding the right lawsuits to invest in requires quite a bit of time, effort, and capital.
Like other nascent investment strategies, high returns are the result of highly knowledgeable investors, of which there are few and far between.
But Eva Shang, co-founder of Legalist, is trying to change that. Her firm uses quantitative techniques and machine learning applications to find easy-to-manage deals in litigation finance, bankruptcy, and government receivables.
Founded in 2016, the firm now manages more than $650 million and is on track to hit $1 billion in assets under management by the year’s end. So far this year, the firm has built a board with ex-Nuveen and Canyon Capital executives and garnered investments from endowments, foundations, and insurers.
And the strategy is all about the technology. “Even though each of our strategies is hyper-targeted, our core thesis is that our technology allows us to scale across asset classes,” Shang said. She added that the strategy generates alpha by sourcing deals quickly across the databases it scours.
Sitting outside of a Midtown, Manhattan coffee shop, Shang pulled a laptop out of her backpack to demonstrate the firm’s proprietary technology. She dove deep into Legalist’s tech, peppering in anecdotes and even threw in a few memes during the conversation.
Read the full article on the Institutional Investor.