LegalPay is India’s only data-driven and tech-enabled alternative-investments platform specialising in legal and debt financing assets. LegalPay is the pioneer in providing Third-Party litigation funding in India.
Legal Pay’s Founder & CEO Kundan Shahi is a first-generation entrepreneur. No one in his family or relatives is an entrepreneur. His father is a farmer, and he was raised in a small town in Bihar. He completed his studies in Bihar and traveled to Delhi to explore and gain work experience.
The concept of Legal Pay was conceived by the founder, while he was working for EXL Services and assisting one of the insurance businesses. He had the idea of starting a litigation financing company because the legal segment has always been on his radar from a segment or an opportunity standpoint.
LegalPay is India’s only data-driven and tech-enabled alternative-investments platform specialising in legal and debt financing assets. Its dedicated team provides a massive investor network with access to flexible and innovative investment products to modernize its portfolio by including asset-backed alternatives. Their products democratise such investment opportunities through low ticket entry points making them accessible to a larger audience. LegalPay is based out of Gurgaon, and this company was founded in 2019.
So, what is so unique about Legal Pay? Let us know.
They have created an impact on multiple fronts. For litigation finance, the cases which they chose not to fund, 90% of those cases have been opted-out and they did not pursue further. Their clients realised that if LegalPay has not found merit to pursue considering legal/financial viability it is better to drop the case instead of dragging it. This has freed up the court’s time.
LegalPay presents a unique asset-backed investment opportunity of earning a higher fixed income monthly return. The team at LegalPay curates investment opportunities in the insolvency space by identifying companies looking to raise Interim Finance to meet their operational needs. It then presents these opportunities on its platform for retail investors to participate. Their idea of democratizing enables investors to invest with a ticket size as low as INR 10k and generate IRRs upwards of 20%.
So, what was the mission and vision at the outset of LegalPay? One may ask.
The founder put it in this way “LegalPay’s mission was to help investors modernise their portfolios with flexible and innovative legal, insolvency, and debt financing opportunities and to set new benchmarks for wealth generation in India. At the same time, we also want to contribute to the growth of the startups and companies by supporting them with capital that is either required for their litigation expenses or operational needs during the insolvency process”.
This successful startup offers Interim Finance Model. It undertakes the following activities for its investors –
- Identifying opportunities for investment and constructing deals with RPs of corporate debtors that meet their financial and risk criteria.
- Making these investment opportunities (asset, details of the corporate debtor, and terms) available on LegalPay’s platform.
- Setting up and ensuring compliance of the SPV (Special Purpose Vehicle) through which the investment is done. For each opportunity, investments are done via an individual SPV which is structured as a Limited Liability Partnership (LLP) or a Private Company to ensure transparency and avoid any chance of co-mingling of funds.
- Monitoring of the investment over the tenure including ensuring timely payment of the returns.
LegalPay charges 2% management and 20 % carry for Litigation finance assets however 1% flat for Interim finances opportunities.
Now, let us know how this company is helping businesses and taking the financial sector by storm?
When a company/business/ entity has a dispute against another, it shifts its focus from growing the business and increases its burden of handling the litigation, incurring all its costs etc. This is where LegalPay comes into the picture; it takes all the burden of the litigation costs and funds it. In return, they charge a portion of the claim amount, only and only when there is a successful realisation of the monetary award.
The target audiences of LegalPay are users that are typically in the age group of 25-40, with a salary of 12+ lakhs, are very digitally savvy, and are based in cities across India. LegalPay services are currently available for resident and non-resident Indians. This startup has a registered user base of 15,000 from 7 countries and 43 cities.
There are a lot of grounds on which this startup has achieved success, be it in terms of many investors, successful delivery to maximise customer satisfaction or product enhancements, they are on their way up to being better each day than before.
As the first company to provide Third-Party litigation funding in India, LegalPay had its share of hurdles, the most difficult and exciting of which was to communicate and acquire the trust of businesses and individuals and that is one of the biggest victories of this startup’s growth journey. They have cultivated such an ethical and trustworthy community of individuals who are backing LegalPay.
LegalPay has raised Seed and Pre-series A. They will raise Series A in the coming months. Their investors’ list includes Let’s Venture, Venture Catalysts, 9 Unicorns and Amity Innovation Incubator.