Litigation Funding PortfolioFree Financial Model Download

A litigation-funding portfolio model captures the expected return of a closed-end fund that finances commercial-litigation, intellectual-property, antitrust, mass-tort, arbitration, and trade-secret cases in exchange for a contracted multiple of capital deployed on a win. The workbook runs across seven sheets — Cover, Assumptions, Case_Portfolio, Cashflows, Returns, Sensitivity, Checks — plus the shared Disclaimer. Every input is a named-range cell, every formula is one or two operations long, and the workbook passes static-value, self-reference, dead-assumption, and unused-named-range scans.

The case panel sits on the Assumptions sheet: eight cases with capital commitment, funding year (0-2), duration in years (2-4), base win probability (35-65%), MOIC on win (2.5-6.0x), and loss recovery rate (5-20% of capital). A Scenario_Sel parameter drives a CHOOSE() over three win-rate scalars (Base 1.00x, Bull 1.20x, Bear 0.75x), capped at 100% per case on the upside. The total committed capital is 37 million USD spread across eight diversified case types and three vintages — the sector convention for a sub-$50M emerging-manager fund.

The Case_Portfolio sheet computes per-case expected value: EV recovery = Capital × (Adjusted Win × MOIC + (1 − Adjusted Win) × Loss Recovery), then EV profit, EV / cost ratio, and resolution year (funding year + duration). The Cashflows sheet rolls annual portfolio cashflows — per-case capital out triggered by funding year, per-case expected recoveries triggered by resolution year, plus a 2% management fee drag every year on committed capital — into net pre-carry and cumulative pre-carry rows.

Carry is computed European-style: only in the terminal year, only on profits above the hurdle × weighted-average duration, at 20% of the excess. This matches institutional fund convention for closed-end vehicles. The Returns sheet headlines gross IRR (23%), gross MOIC (2.0x), net IRR (21%), net MOIC (1.7x), TVPI, DPI, and portfolio NPV at a 12% discount rate, plus the capital-weighted win rate, weighted-average duration, total capital deployed, expected recovery, expected profit, and cumulative fees and carry paid.

The Sensitivity sheet runs a 5x5 grid of net IRR across win-rate scalars (0.6x to 1.4x) and MOIC multipliers (0.8x to 1.2x) using a closed-form approximation that lands within tolerance of the headline IRR at the centre cell. The Checks sheet runs seven cross-sheet validations — capital deployed equals commitment, all adjusted win probabilities ≤ 100%, every case EV recovery non-negative, carry confined to the final period, carry respects the hurdle gate, net MOIC ≤ gross MOIC, and the sensitivity centre cell within tolerance of the headline net IRR.

Target users are litigation-finance LPs (pension funds, family offices, alternative-asset allocators), fund GPs raising or reporting on a litigation-finance vehicle, and bankers underwriting LP commitments. The model is calibrated against published gross returns from Burford Capital, Omni Bridgeway, Therium, and Parabellum — typical commercial-litigation funds report 20-35% gross IRR and 15-25% net IRR on 2.5-3.5 year duration. Use the scenario selector for win-rate stress testing, edit the case panel for portfolio diversification analysis, and flex the fee-and-carry inputs to compare the LP cost of 2-and-20 against alternative structures.