Delhi-based litigation funding platform LegalPay has launched has launched an alternative investment product for retail investors. Through the venture, investors can fund third-party litigations for a minimum amount of Rs 25,000.
The company has created a Special Purpose Vehicle (SPV) to create a pool of 4-8 commercial cases to ensure diversification of investor’s capital to generate lucrative IRRs and minimized risk. The vehicle is designed to finance arbitrations (both domestic and international), medium and late-stage litigations, specialized forums and claim buyouts opportunities, The Hindu reported.
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. Litigation finance is an arrangement under which the businesses get their due and even the funders make money. The company is 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.
Most businesses do have a dedicated legal budget and often working capital is required for eminent needs like sales, manufacturing, human resources. This often leaves them incapable of pursuing legal claims which will fetch them money properly as they are unable to allocate capital for it. LegalPay help businesses get access to justice in exchange for a portion of the recovery made because of the lawsuit.
“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 ₹25,000. Through our SPV, we intend to ensure that the investors’ money is safe and secure by providing diversification across a basked of lucrative cases,” said Kundan Shahi, Founder of LegalPay.