While this business is in its infancy, Balance Point is part of a bigger trend – the growing industry that invests in other people’s lawsuits, arming plaintiffs with money to help them win more money from defendants. Banks, hedge funds and boutique firms like Balance Point now have a total of $1 billion invested in lawsuits at any given time, industry participants estimate.
Lawsuit lenders initially focused on personal injury cases, but over time they have sought new frontiers, including securities fraud cases brought by disgruntled investors, whistleblower claims against corporations and property development disputes.
Stacey Napp, a lawyer by training who has spent her career in finance, founded Balance Point last year with money from her own divorce. Since then, she has provided more than $2 million to 10 women seeking divorces. She says she is helping to ensure both sides can defend their interests.
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