Co-founder Demands Rs 40 Crore After Initial Rs 6 Lakh Investment Tanks, Entrepreneur Says 'I Can't Sleep'

An entrepreneur said they were unable to sleep after their co-founder took them to court, demanding Rs 40 crore over a failed startup despite having only invested Rs 6 lakh. In a social media post, the entrepreneur detailed that they were introduced to a mutual contact last year who wanted to 'get into Web3' and decided to invest the money.

Since the entrepreneur had already built a project, a simple agreement was signed where they both served as 50-50 co-founders. The idea was that the new founder would provide the investment while they would do the legwork.

"He puts in Rs 6 lakh as capital; I do literally everything else. Arbitration clause for disputes. No refund clause. No guaranteed returns. No timeline," the entrepreneur wrote.

"I delivered. Artwork, website, branding, the full asset pack, all shared with him. Then the crypto market fell off a cliff. The project never launched. Neither of us made a single rupee."

However, the crypto market crashed soon, and the project could never get off the ground. Neither of them made a single rupee.

"Where it got weird. Month 4: "Where's my ROI?" Fair enough, I explained the market. Month 8: "Return my Rs 6 lakh with interest." My lawyer replied that it was an investment, not a loan. It says so in his own letter," they said.

Three weeks later, they sent a claim for Rs 40 crore in "loss of revenue". As per the entrepreneur, the now-bitter co-founder was using the pitch deck as evidence that they were owed the money.

"Where did 40 crore come from? As far as I can tell, from the projected revenue slide in our original pitch. The optimistic "if everything goes perfectly" slide. He's treating a pitch deck like a signed cheque," they said.

"No, he's filed in the High Court to get an arbitrator appointed. The first hearing just got adjourned. I have a lawyer, but at 2am my brain keeps asking 'what if,'" they added.

Check The Post Here:

My ex-cofounder invested ₹6 lakh. Now he wants ₹40 CRORE from me. It's in the High Court and I can't sleep.
by u/Exotic-Departure-636 in LegalAdviceIndia

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'You Can Relax'

Reacting to the post, social media users assured the entrepreneur that their case was solid, and they did not owe anything to their co-founder.

"Bro thinks he invested in some bitcoins to expect 666x returns," said one user, while another added: "Lawyer here. He's free to claim the world. But in your case, there is no need to give in to any of his demands. The High Court will simply appoint an arbitrator. Fees are to be shared by both sides."

A third commented: "I'm an advocate in Bangalore. His case is extremely weak; a pitch deck isn't a contract. Projected revenue isn't guaranteed. He signed an agreement with no refund clauses. The Rs 40 crore claim has zero legal grounds. The High Court can strike it out as frivolous before arbitration even starts."

A fourth said: "Don't worry, the arbitrator will ask you to settle, but you can relax and let your lawyer handle it. This is going to take time, but everyone knows you don't owe him."