15 years old and never broken
What Is the Funder Pledge?
The Funder Pledge is a binding, unilateral agreement from Bransgroves Lawyers to every funder who refers an investor to us. It guarantees that we will never go around the referrer and do business directly with the investor— full stop. This pledge is fundamental to our business model and we must respectfully decline to work for investors except in accordance with the pledge.
Who Is a “Funder”?
A Funder is a person or entity that acts as a broker to introduce loans to investors and refers those investors to us as their lawyers on the advance. Typically, these investors will participate in a syndicate we document, and lend through a bare trustee which we provide.
Why We Do This
The identity of investor is a highly valuable commercial secret. Without protection, the economics of cultivating and training investors simply don’t work for funders. Every other law firm reserves the right to act for your investors directly — which discourages referrals altogether. In order to keep their investors secret from their lawyers funders have to operate through a AFSL (and control a trust structure behind which the investors can be hidden). However this is extremely expensive and difficult to justify when a funder is beggingin their growth or only interested in limited growth.
We take the opposite approach. We accept that the pledge costs us work, but the work we gain on the other side of the ledger far outweighs the cost. By guaranteeing we will never go around you, we earn the confidence of funders who would not otherwise refer to a law firm at all. This is how Bransgroves became Australia’s leading firm for loan syndication work.
Limited Exceptions
The pledge does not apply where, at the time of referral:
- We have already acted for the investor in the past
- The investor has already been referred to us by another funder
- The investor holds an AFSL and operates a mortgage fund
- The investor has a website advertising themselves as a commercial lender
- If an investor later obtains an AFSL and begins operating a mortgage fund, the pledge ceases to apply from that point forward.
Absolute & Unconditional
We have a reputation to protect. Therefore even if a funder purports to release us from this pledge for a particular investor, we will still not act for that investor again unless the transaction comes to us through the original referring funder. This protects trust and eliminates ambiguity — permanently.
This page describes the Funder Pledge. For a copy of the actual Funder Pledge contract contact Matthew Bransgrove.
