LegalPay, India’s first and only third-party litigation funding platform, has launched an alternative investment product for retail investors. Investors can invest and diversify across a basket of cases for as little as INR 25,000 only.
The company has created a Special Purpose Vehicle (SPV) to create a pool of 6-12 commercial cases to ensure diversification of investor’s capital to generate lucrative IRRs and minimized risk, even for the smallest fraction of such investment. The first SPV for upper retail investors goes live on August 10, 2021, and investors can invest directly on the company’s website (www.legalpay.in) through a seamless digital process. The entire investment process is digital and seamless including signing of investor documents, KYC, tracking of the basket of claims, portfolio monitoring and analytics, etc.
This SPV is designed to finance arbitrations (both domestic and international), medium and late-stage litigations, specialized forums and claim buyouts opportunities. These potential claims/cases are disposed of in a time-bound manner and all of such claims/cases have a relatively shorter investment cycle. This SPV has a strong focus on B2B (business-to-business) commercial disputes, in which both parties are businesses fighting over a commercial dispute such as Breach of Contract Disputes, Recovery Claims, Partnership Disputes, Unfair Competition Claim, Term-sheet Disputes, Cross Border Transactions Disputes, Taxation Disputes, Intellectual Property Disputes, etc. The SPV will have a life cycle of 36 months (extendable by 24 months). Still, the distributions will start happening to the investors as and when the invested cases resolve, approximately starting 12 months from the SPV’s closure.
Founded by season investor Kundan Shahi in 2020, LegalPay helps entities/businesses ease the financial burden of litigation cases such as shareholder and IPR related disputes with the help of technology. The New Delhi-based start-up, backed by venture capital firms such as 9Unicorns and LetsVenture and by marquee angels including Ashwini Kakkar, ex-chair via.com, and Ambarish Gupta, ex-founder of Knowlarity, among others . LegalPay focuses on potential late-stage B2B commercial cases that are nearing closure and have a financial requirement of anything ranging from Rs 20 lakhs to Rs 3.5 crore.
“LegalPay believes in the democratization of investment made via its platform by making it easier for even smaller retail investors to invest. Earlier, only the ultra-rich had access to this asset, but we are making it accessible to anyone and everyone. Anyone can invest with a starting ticket size of Rs 25,000. Through our SPV, we intend to ensure that the investors’ money is safe and secure by providing diversification across a basket of lucrative cases” said Kundan Shahi, Founder of LegalPay.