With decades of experience and an established brand, FORIS stands for professionally provided services in the legal sector. Our focus is on commercial litigation funding, the trading of pre-established legal entities (shelf companies) and various coporate services for founders and entrepreneurs.
FORIS AG is a provider of legal market services that are based on different business models and complement each other. With respect to all our services, we are one of the leading providers in the German-speaking countries, with decades of experience, distinctive expertise and a well-known brand that stands for professionalism, customer focus and added value.
Our most important business areas are litigation funding, trading in shelf companies and the provision of various corporate services for founders and entrepreneurs. Our portfolio is rounded off by a number of useful service tools available to our target groups (mostly lawyers, tax consultants and notaries) free of charge.
Litigation funding, which we pioneered and established in the German-speaking countries back in 1998, enables our clients to enforce their legal claims without having to bear the cost risks associated with litigation. FORIS AG provides the funding for the legal dispute and – in turn – receives a share in the proceeds if the dispute is resolved successfully.
Since the introduction of its litigation funding, FORIS has reviewed more than 15,000 funding requests and successfully funded more than 1,000 proceedings with an aggregate dispute value in excess of EUR 1.3 billion. Our success rate has consistently been between 75% and 80%, which is due to the professional assessment of every funding request by our internal legal team and funding limited to cases which, as per our assessment, have sufficient merits. Particularly in the mid-cap segment, where we pursue a balance sheet funding approach and invest our own capital to fund proceedings with dispute values usually up to about EUR 30 million, FORIS has built up an excellent reputation and has firmly established itself as a strong brand in the German legal community.
Key factors for our future income from litigation funding are the number of cases in the portfolio and the resulting aggregate revenue potential from the share in the outcome of the individual portfolio cases, expressed as Option Volume. The expansion of the portfolio, which we have strongly accelerated in recent years, is therefore of strategic importance.
We have observed that the market for litigation funding has been growing steadily for years. According to market researcher CMI, the European market for litigation funding is expected to grow by an average of 9.8% annually from the original EUR 2.75 billion in 2022 to EUR 7.01 billion in 2032. This is reflected not only in the number of funding request we receive, but also in growing dispute values.
The latter is driven, among other things, by the fact that larger companies are increasingly recognizing the use of litigation funding as a means of active risk management to pursue large claims. In 2024, we reacted to these developments by enhancing our business model with an off-balance sheet funding concept by initiating a third party fund. By teaming up with institutional investors, this additional funding concept enables FORIS to fund more large-volume proceedings, in addition to the cases funded through our own portfolio. As a result, our litigation funding business is now based on two pillars and funding sources, offering FORIS considerable growth potential.
Our second core product consists of the formation and sale of so-called shelf companies. These are pre-established companies of various legal forms such as UG, GmbH, AG or SE, which can be acquired and put to economic use within a few hours. Shelf companies are typically used, for example, when businesses are newly founded, in connection with M&A transactions or restructurings, or in real estate projects. Compared with the lenghty ordeal of founding a new entity, a shelf company is immediately available, including having a bank aacount.
In recent years, we have sold more than 500 shelf companies annually, setting new standards as one of the leading providers. For example, almost 50% of all SEs registered in Germany were founded and sold by FORIS.
We sell our shelf companies with the fully paid-in capital contribution, plus a mark-up for formation costs and our profit margin. The business model is based on scaling and efficient processes. The purchase price is usually paid immediately upon sale, so that both credit risks and lengthy pre-financing are eliminated. Compared to litigation financing, this is a fast-moving business with consistent cash flows and low volatility.
Our supplementary Corporate Services for founders and entrepreneurs support our customers in managing various administrative challenges. With our Transparency Registry Service, for example, we provide the service of registering the beneficial owners of their company in the mandatory transparency registry. Other corporate services include the temporary assumption of board functions following the acquisition of a company, support with official issues such as tax numbers and business registration, or the provision of virtual business addresses.
Our services for founders and entrepreneurs are offered as a one-off service or as a subscription model and serve to round off our overall package. It is our intention to continuously expand our service offerings, always geared towards the needs of our target group.
The diversification across various services and business models serves to reduce dependencies on economic cycles or specific market developments. As an integrated provider of various services to the legal market, we serve target groups that are largely congruent. This enhances brand awareness among our target groups, which in turn benefits equally from the diversification. Accordingly, we will continue to strive to expand our service portfolio in the future, with the aim of further strengthening the excellent market position of FORIS and increasing company value.
