We live in a litigious society, and based on the crowded courts, you could say that lawsuits are a shared societal investment. Hedge funds and pension funds know that, and among the esoteric stuff in which they invest—royalties from David Bowie records and highway toll plazas—are also legal spats. Now the hedgies have some courtroom competition.
LexShares is an online marketplace that allows individuals to invest in litigation, connecting plaintiffs in commercial legal disputes with investors to fund their cases. It claims to be the only company enabling investment in lawsuits online.
New York City-based LexShares compares its asset class to the early days of the private equity industry in the 1980s. You could also claim its like a Kickstarter campaign meets late-night class-action lawsuit TV advertisement. Currently, it has a whistleblower case against a government contractor, a product liability case against a Fortune 500 manufacturer, and a fraud case against an oil and gas developer listed on its site.
It has raised more than $1 million—though it declined to be more specific—in a previous financing led by Atlas Venture, which invests in early stage tech and life sciences companies.