find the latest legal job
Freelance Lawyers
Category: Banking and Finance Law | Location: All Perth WA
· Freelance opportunities through Vario from Pinsent Masons
View details
Freelance Lawyers
Category: Other | Location: All Adelaide SA
· • Qualified lawyer with a strong academic background
View details
Freelance Lawyers
Category: Other | Location: All Melbourne VIC
· • Qualified lawyer with a strong academic background
View details
Insurance Lawyer (1 PAE)
Category: Insurance and Superannuation Law | Location: Brisbane CBD & Inner Suburbs Brisbane QLD
· Great Career Opportunity ·
View details
Insurance and Health Lawyer (1-4 PAE)
Category: Insurance and Superannuation Law | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· New position to support Growth ·
View details
How SME law firms can use disbursement funding to generate new revenue

How SME law firms can use disbursement funding to generate new revenue

Anthony Hersch

For all small businesses, managing cash flow is crucial. In the legal space, we continually find that cash flow is the critical measure that influences SME law firms’ ability to generate revenue and growth, writes Anthony Hersch.

What legal firms are less aware of is how disbursement funding can play a vital role in boosting the organisation’s operations, sustainability and earning potential.

What is disbursement funding?

Disbursement funding is the provision of finance for third-party costs (disbursements) that form part of any litigation.

This includes the funding of medico-legal reports, radiology reports, court appearance and filing fees, barristers' fees and all other expert reports/expert witness fees.

Disbursement funding is designed to assist SME law firms, personal injury law firms, commercial litigation firms, family law firms and all other firms that seek growth without cash flow implications.

The reason this financial product is powerful is that it allows the law firm to defer the payment of third-party costs (disbursements) until settlement (or for up to 30 months, whichever comes first). This enables an immediate cash flow benefit and facilitates growth by allowing law firms to redeploy their capital to focus on significantly increasing their number of cases.

JustKapital has a standardised, simple and transparent fee structure, with no hidden costs or complex calculations leading up to settlement, as the price is known up front.

Disbursement funding is a well-established and powerful financial solution that’s widely adopted in Australia, the UK and the USA. While the upside of this funding is clear, it often isn’t straightforward to obtain due to the legal industry often being unfamiliar with the term.

Knowing what to search for is the first step to breaking the barrier to funding more cases

A core reason that disbursement funding is currently underutilised is due to the array of terms used to describe the funding solution.

The most common term used to search for disbursement funding is 'litigation funding'. Other terms used include: outlays funding solutions, claims funding, legal funding, legal financing, third-party funding, litigation loans, litigation funding solutions, loan-based funding and disbursement loans.

To clarify, litigation funding is where a third-party funder provides the financial resources to enable sizeable shareholder class actions or corporate litigations to commence. Most often, covering disbursements will be included as a component of a litigation funding process.

In comparison, disbursement funding is a standalone funding solution that’s geared to support SME law firms. The effect of the financial solution is significant: disbursement funding removes the immediate barrier to business growth by delivering access to capital, and therefore equates to new revenue streams.

Disbursement funding facilitates growth without cash flow implications

The net benefit of disbursement funding for SME law firms is significant. It removes any cash flow impediments to fund disbursements, enables cases to move forward quickly and, importantly, increases the opportunity to take on more cases.

Overall, it provides more cash flow flexibility and facilitates growth.

We encourage SME law firms to take advantage of this smart alternative.

Anthony Hersch is the general manager of disbursement funding at JustKapital Litigation Partners.

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

How SME law firms can use disbursement funding to generate new revenue
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
Please, Continue (Hamlet), Melbourne Festival
Oct 16 2017
Hamlet suffers slings and arrows of top Victorian barristers
Victorian judges and barristers have performed the unique play Please, Continue (Hamlet) at the Melb...
Julian Assange
Oct 13 2017
When justice fails, according to Assange
WikiLeaks founder Julian Assange has dismissed the capacity of judicial systems to deal with complex...
Aussie anti-terrorism laws, detention of 10-year-olds
Oct 13 2017
Treatment of kids under Aussie anti-terrorism laws an over-reach: ABA
The Australian Bar Association has urged the government to reconsider proposed reforms to Australian...
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...