Pipe vs Capchase for Law Firms: What an OGC Retainer Can Finance

A monthly OGC retainer, billed the same amount to the same client for ongoing advisory availability rather than a specific matter, is the closest thing a law practice has to SaaS ARR. It's the only revenue type either Pipe or Capchase can realistically underwrite, since it has a defined term, a consistent amount and a verifiable payment history.

Hourly litigation billing, transactional deal fees and contingency matters don't have that shape. They're tied to case milestones or hours worked rather than a calendar, and no amount of client loyalty changes the fact that there's no recurring collection pattern a lender can verify in advance.

Client funds held in an IOLTA or other trust account are not your firm's revenue, and no legitimate financing provider should be advancing against them. Keep this distinction explicit when you talk to either provider: what you're financing is your firm's own earned fee revenue, specifically the retainer portion, not any balance sitting in trust on a client's behalf.

This matters practically because a firm's operating account and trust account activity can look intertwined to an outside underwriter reviewing bank feeds. Be ready to walk a lender through which deposits are earned retainer fees and which are client funds passing through trust, since conflating the two is both a bad look and, in most states, an ethics violation independent of any financing question.

Advancing a receivable to a third party is, functionally, assigning a right to collect a legal fee, and several state bar ethics rules place conditions on that: some require client notice or consent, others restrict fee-sharing arrangements with non-lawyers in ways that could bear on how an advance is structured. This varies by state and isn't something either Pipe or Capchase will advise you on, since it's outside what a financing platform reviews.

Before signing an advance against retainer receivables, have your firm's ethics counsel or general counsel confirm the arrangement is permissible under your state's rules of professional conduct, specifically around fee assignment and any required client disclosure. This step has nothing to do with which platform you pick and everything to do with staying compliant regardless of which one you choose.

Before signing, work through these checks:

• Confirm that what you're financing is earned retainer fee revenue, not funds held in an IOLTA or other client trust account.
• Check your state bar's rules on assigning a fee receivable, including any client notice or consent conditions.
• Look at fee-sharing restrictions involving non-lawyers that could bear on how the advance is structured.
• Have your firm's ethics counsel review the specific advance structure before you sign anything.

Pipe suits a firm financing a specific, well-established OGC retainer, say a longstanding corporate client on a flat monthly fee, without setting up a standing relationship it will rarely use. You select that one contract, and Pipe advances its remaining value against the client's ongoing payments.

Capchase suits a firm with several OGC retainer clients that expects to draw capital more than once, whether to smooth cash flow between retainer collections or fund an associate hire ahead of new retainer work closing. Because the facility scales with your recurring retainer book as it grows, it avoids reapplying from scratch each time.

Every rate quoted in this category traces back to the same floor: a bank prime loan rate of 6.75 percent¹, sitting roughly three points above an effective federal funds rate of 3.63 percent². Turn whatever discount fee you're quoted into an annualized number against your actual repayment schedule before comparing it to what a bank line would cost.

For a firm with only a thin OGC book, it's also worth asking whether the simpler fix is commercial: renegotiating retainer rates upward at the next renewal, or converting one more hourly client to a retainer arrangement, rather than financing a receivable stream that's still small relative to the firm's overall billings.

A corporate client can terminate an OGC arrangement for reasons that have nothing to do with your firm's work: a new general counsel wants to bring more work in-house, the client is acquired and its legal spend gets consolidated with the acquirer's existing firms, or budget cuts hit outside counsel first. Both Pipe and Capchase collect on a full recourse basis, so an ended retainer doesn't erase what your firm owes on an open advance.

Before financing a retainer receivable, look at how the engagement is actually documented: an OGC agreement with a defined notice period and minimum term gives you more warning than an at-will arrangement that either side can end immediately. A longer notice period gives your firm time to wind down the advance in an orderly way rather than absorbing the shortfall all at once.