YieldStreet Diversified Pre-Settlement Portfolio XXV: The Acquisition Exit
How a platform acquisition turned a 48-month investment into a 21-month win with 13%+ returns
The Numbers
| Invested | $250,000 |
| Returned | $289,248 |
| Net Profit | $39,248 |
| MOIC | 1.16x |
| IRR | 13.14% |
| Target Term | 48 months |
| Actual Term | 21 months |
The Investment
In December 2017, YieldStreet launched Diversified Pre-Settlement Portfolio XXV — a $5.18 million pool of consumer litigation advances originated by LawCash. The deal filled in minutes. I committed $250,000.
The structure:
- 13% target interest rate
- 48-month term (extended from the original 36 months — YieldStreet had learned that legal cases often take longer to resolve)
- Diversified portfolio of pre-settlement advances to plaintiffs in personal injury cases
- LawCash as originator — one of the largest consumer litigation finance companies
Pre-settlement funding works like this: plaintiffs in personal injury lawsuits need money while waiting for their cases to settle. LawCash advances them cash in exchange for a portion of their eventual settlement. If the plaintiff loses, they owe nothing. If they win, LawCash gets repaid with interest from the settlement proceeds.
Investment Timeline
The Surprise Exit
In August 2018, Dennis Shields — the founder and CEO of LawCash — died from an apparent opioid overdose at age 51. He was found in his Trump Tower apartment in New York. Shields had built LawCash into one of the largest players in consumer litigation finance since founding it in 1999.
A year later, in September 2019, YieldStreet announced they had acquired LawCash. Whether the founder’s death contributed to the sale, I don’t know — but the timing was notable. As part of the acquisition, all outstanding LawCash-originated investments would be repaid in full.
Instead of waiting another 27 months for the portfolio to naturally wind down, I received full repayment of principal plus all accrued interest:
| Date | Amount | Note |
|---|---|---|
| Sep 3, 2019 | $428 | Case settlement |
| Sep 18, 2019 | $3,180 | Multiple settlements |
| Sep 27, 2019 | $285,640 | Final payoff (acquisition) |
| Total | $289,248 | 1.16x |
Why This Worked
Diversification across many small cases. Pre-settlement portfolios spread risk across hundreds of individual advances. No single case outcome determines returns. This is the opposite of funding one big lawsuit.
Experienced originator. LawCash had been in business since 1999 and was one of the largest players in consumer litigation finance. They understood case selection and risk management.
The acquisition accelerated returns. YieldStreet buying LawCash meant they had to make investors whole. Instead of waiting for each underlying case to settle over 4 years, I got a lump sum exit in under 2 years.
Non-recourse to plaintiffs = aligned incentives. If a plaintiff loses their case, they owe nothing. This means LawCash only advanced money on cases they believed would win. The selection filter was built into the business model.
The Numbers in Context
| Target interest rate | 13.00% |
| Actual IRR | 13.14% |
| Target term | 48 months |
| Actual term | 21 months |
| Time saved | 27 months |
The IRR slightly exceeded target (13.14% vs 13.00%), and I got my capital back more than 2 years early. The early exit meant I could redeploy that $289K into other investments — a hidden return that doesn’t show up in the IRR calculation.
What I Learned
Platform acquisitions create unexpected exits. I didn’t anticipate that YieldStreet would acquire LawCash. But when platforms consolidate — sometimes accelerated by founder transitions — they often buy out existing investors to clean up the cap table. This can work in your favor.
Key-person risk is real. Dennis Shields built LawCash over 20 years. His death at 51 likely changed the company’s trajectory. In alternative investments, founders matter — and their absence can trigger unexpected outcomes, both good and bad.
Diversified portfolios are lower variance. Unlike single-case litigation funding (where you might get 0x or 3x), pre-settlement portfolios tend to cluster around their target returns. Hundreds of small advances average out.
Consumer litigation finance is different from commercial. Personal injury cases are simpler than complex business disputes. The plaintiff either wins their settlement or they don’t. Less legal complexity means more predictable outcomes.
This was my first YieldStreet investment — and it worked. 13%+ IRR, early exit, full principal returned. It set my expectations high. As I’d later learn with Law Firm Financing VII, not all YieldStreet investments end this well.
Final Accounting
| Initial investment | $250,000 |
| Total returned | $289,248 |
| Interest earned | $39,248 |
| Holding period | 21 months |
| IRR | 13.14% |
This was my first YieldStreet investment. $250,000 committed in December 2017, targeting 13% over 48 months. Eight months later, the founder died. A year after that, YieldStreet acquired the company and paid everyone out. $289,248 returned — full principal plus interest. The perfect start to what would become a more complicated relationship with the platform.
