US-based hedge fund invests in Indian litigation financing start-up 

Indian start-up LegalPay, which offers litigation financing facilities, has secured funding from US-based hedge fund Hedonova, which specialises in investing in alternative assets, including start-ups, NFTs, art, wine and emerging market real estate among other things. 

The hedge fund has participated in the Pre-Series A round of funding of LegalPay and is an extension to the litigation financing start-up’s funding round in December that was led by Venture Catalysts and Amity Technology Incubator. 

Interestingly, Hedonova has among its portfolio companies, marquee names like SpaceX, Swiggy, OpenSea, Robinhood, Flexport and Sila Nanotechnology among others. 

Founded in 2020, LegalPay competes with restructuring giants such as Edelweiss, KKR and Eight Capital that generally focus on high-ticket transactions. LegalPay targets mid-market companies including MSMEs undergoing insolvencies that have a requirement of Rs 10 lakh to Rs 5 crore. 

Till date, the start-up has launched two sector-based Interim Finance SPV – a real-estate focused Interim Finance SPV under IBC, 2016 with a ticket size as low as Rs 10,000 and a healthcare focused SPV that was subscribed 135 per cent in less than 48 hours.  

Interim finance is a short-term super-secure loan that allows an insolvent company to remain operational when it is undergoing the Corporate Insolvency Resolution Process (CIRP). 

“The deep-expertise that Hedonova brings on the table for massive 12+ asset classes is something we look forward to partner and grow together at exponential pace. We are aggressively growing in the Indian market and such strategic partnerships will not only fuel our growth at a faster pace but also provide investors with more opportunities to invest,” said Kundan Shahi, Founder & CEO, LegalPay. 

“India's high savings rate is rapidly being mobilized into financial assets and alternative assets are gaining momentum. LegalPay's team has the required professional experience, high strength of character, and the drive to capture the alternative investment market in India. We have invested in their pre-series A and plan to keep backing the team in follow-on rounds as well,” said Suman Banerjee, Founder and Chief Investment Officer, Hedonova.