Considered a crime for centuries, litigation finance or the practice of funding lawsuits commercially, first got started in the late 1990s when a series of favorable decisions in England and Australia made the approach mainstream. The first commercial litigation funder to sell its share publicly was IMF Bentham, traded on the Australian stock exchange in 2000. After going public, IMF Bentham raised $6.6 million, but remained a penny stock, as markets had difficulty valuing its litigation investment assets.
After the 2008 financial crisis, funding commercial lawsuits drew increased interest from investors as the fall of major investment vehicles forced institutional investors to explore new options to find decent returns. The uncorrelated nature of litigation funding made it a newly interesting asset class.
In 2015, Therium Capital Management, a London-based funder, secured £200 million ($303.5 million) in financing from AmTrust Financial Services, a New York insurer with $21 billion in assets is the backer. This investment by a traditional finance company indicated the mainstream nature of litigation finance. In 2016, Fortress Investment Group, a $70 billion alternative asset manager in New York, executed an arrangement with Vannin Capital, another litigation funder in London, that gives Vannin access to a pool of as much as $500 million. In 2016, Legalist was founded as a technology startup to bring quantitative underwriting to small business lawsuits.