When SMEs Need a Powerful Partner
In Canada, Small and Medium Enterprises (SMEs) account for 52% of private sector GDP and employ almost 70% of private sector workers. In recognition of their important role, the Trudeau Government recently took steps to make it easier for SMEs to access business financing and increased support for entrepreneurs.
For many SMEs, however, a legal dispute can spell disaster. Litigation is expensive and uncertain, and drains company resources – both in term of cash and management time – from the core business. As a result, SMEs often choose not to pursue legal claims, particularly where they have been wronged by a more powerful party.
SMEs now have a mechanism for advancing litigation: commercial third-party funding is an innovative tool that enables businesses to pursue claims without risk, and without cost. In January 2016, Bentham IMF became the first commercial funder to open an office in Canada and make this tool available to SMEs.
Yesterday, Bentham Investment Manager and Legal Counsel Naomi Loewith spoke at the Canadian Council for Small Business and Entrepreneurship about how third party litigation funding can enable SMEs to pursue those meritorious claims. By partnering with a litigation funder, an SME can focus its capital on growth and development, and use the funder’s resources to retain top counsel. The SME transfers the financial risk and cost (including any adverse costs order) to the funder.
Bentham will conduct detailed analysis of each case, which helps an SME decide whether or not to pursue a claim. Bentham can also provide working capital, where the SME needs funding to maintain its business over the course of the litigation.
Most importantly, third party funding levels the playing field. It ensures that a claim is decided on its merits, not on who has the deeper pockets. Where there is accountability for egregious conduct, everyone benefits.
Over its 15 years of funding litigation, Bentham has an unparalleled record in Australia and the U.S. of partnering with SMEs. Bentham is delighted to now be in Canada, working with SMEs so that they can focus on growing their core businesses, while retaining top counsel to pursue their meritorious claims.