At last week’s Finnies Awards night, JustFund won the Positive Impact Fintech of the Year Award for 2024. Established in 2022 as a specialist funder of family law litigation, JustFund has been recognized for the social impact their funding has had on Australians going through separation, with more than 75% of their clients being female, 80% being the primary caregivers of children, 58% being victims of domestic violence and having, on average, less than half of the economic capacity of their former partners.
GCI had been in discussions with JustFund about how we can support them since before they wrote their first loan, and after following them closely, we were pleased to provide them with a facility to fund their originations in October last year. In the post below, we discuss what attracted us to JustFund and why we’re excited to continue to fund their ongoing growth.
Strong management team
In the first instance, we were impressed by a strong founder team. Co-CEO’s Andy O’Connor and Jack O’Donnell had developed a compelling business plan, backed by their legal training and litigation funding experience, while Executive Chair Craig Carroll supercharged this with his demonstrated track record of building lending businesses to scale and profitability.
Differentiated product
Secondly, JustFund had developed a product that solved a real problem in the market, primarily providing loans to asset rich borrowers who are unable to demonstrate the required serviceability to qualify for bank funding. Because relationship assets are tied up in the legal process, these borrowers need a specialist lender who can understand both the financial and the legal elements of the situation, taking the opportunity away from traditional established lenders and reducing competition. At the same time, because assets are tied up in the legal process, they’re able to be ringfenced until resolution, improving collections outcomes and driving impressive credit performance.
Compelling distribution strategy
Solving distribution is critical for all lending businesses, and we were impressed with JustFund’s strategy to distribute their product through family law practitioners. This unlocked a distribution channel which is motivated to advocate the product as it helps solve their own working capital concerns. Even better, in edge cases, JustFund’s product could mean the difference between the client being able to fund a needed matter or being otherwise stuck. This drives wins for both the family law practitioner unlocking new business, and in the case of the client, helps drive the social mission recognised above.
Robust balance sheet established for scale
Next, at the point they were asking for a facility, they’d done the hard work and set up a platform that was capable of scaling them all the way to profitability. This included having undertaken two rounds of equity raisings, and putting in place a mezzanine debt facility from related parties to support a senior facility coming in. This made it easy for us to get comfortable providing the company with a $40m facility.
What GCI were able to provide
Despite JustFund being within its first two years of operations, GCI were able to provide a flexible facility to fund their originations out to a greater than $50m loan book. By developing a deep understanding of their product, we were able to offer a competitive LVR that reflected the nature of JustFund’s product. By working closely with their team, we were able to provide certainty of funding during execution as they commenced their next drive for growth.
We look forward to continuing to support JustFund as they execute on their plan, and congratulate them on the recognition they’re receiving for the positive social impact they are driving.
If you have a compelling idea for a lending business and would like to discuss how to set yourself up for long-term success, please reach out to our Asset Backed Finance team.
To read more about how we have helped a variety of businesses transform over the years, visit www.gcifunds.com/case-studies/
Authored by Henry Stewart (Managing Director)