Legalist


Legalist, Inc. is a litigation finance company based in San Francisco, California that funds commercial lawsuits on behalf of plaintiff attorneys, applying machine learning algorithms to evaluate its potential investments.

History

The company was founded in 2016 by two Harvard University undergraduates, Eva Shang and Christian Haigh, as an analytics service to help law firms lookup court records, and evaluate cases based on data gathered from those records. A Thiel Fellow, Shang received $100,000 of initial funding to start the business from Peter Thiel's Thiel Foundation. Prior to launching at that year's Summer Y Combinator Demo Day, the founders decided to refocus the company on funding small business lawsuits directly, rather than helping lawyers or outside investors to do so.
In November 2017, Forbes Magazine included Legalist's founders in its "30 Under 30" Law & Policy list and reported that Legalist had raised $10.25 million over the summer.
In September 2019, The Wall Street Journal reported that Legalist had raised and closed its second fund of $100 million.
In April 2020, AngelList named Legalist among the 52 best startups to watch out for.

Service

Lawyers representing business plaintiffs apply for funding of their cases via the Legalist website, or through an integration with Clio, a case management software package. The company then evaluates cases with a proprietary algorithm that estimates the likely duration of the case, and odds of winning, based on factors such as the judge, court type, lawyers for both parties, and other facts about the case. Factors such as how many cases a judge is hearing help the company estimate how long the case will take. The company primarily focuses on funding commercial litigation cases brought by small businesses. Based on its guidelines for risk and expected return, the company then decides whether or not to underwrite the case in amounts up to $1 million, with the assistance of the company's two underwriting attorneys.