LegalPay, India’s litigation and interim finance provider has partnered with Florida-based hedge fund Naples Global to launch a $5 million fund for Indian founders to protect their rights during any kind of board-related disputes.

The fund has primarily committed $5 million (about ₹37 crore) to deploy with an option to increase the exposure for funders who are looking out for fighting their litigations and arbitration. 

“LegalPay is of a strong belief that all founders have the right to be heard in a strong, safe and legal manner that would enable them to put their case in a much more beneficial and will help them to be heard,” it said in an official release. 

“Founders put their blood and sweat to build start-ups but often find investors arm twisting them on several fronts. Since most founders are first-generation entrepreneurs, they lack the financial muscle to assert their legal rights,” said Kundan Shahi, Chief Executive, LegalPay. 

Creating a level-playing field

He further added that the idea behind this product is to create a level playing field for those disgruntled founders so that they don’t give up on their legitimacy because of financial constrain.

Kelly Morris, a partner at Naples Global LLC, said, ”Our growing investor community continues to remind us that the demand for alternative investments is increasing and now we need outside the US, and LegalPay and their leadership team fit that category perfectly as they are creating a lucrative asset class in Asia.“

The US hedge fund is looking forward to expanding its asset allocation as the fund grows its US business and service into new international markets. Morris further added, “Our investment philosophy is rooted in supporting exceptional teams to grow valuable businesses.”

LegalPay provides non-recourse funding in commercial legal claims in exchange for a share in the final recovery, implying that the litigant only has to pay only upon a successful realisation of the claim. It is a VC-backed start-up backed by Hedonova, 9Unicorns, LetsVenture, Venture Catalysts and Amity Innovation Incubator, among others.

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