Download App

Home

News

Pods

🚀

Startup Showcase

Notifications

Join our whatsapp channel for quick updates

Switch theme

Blog . Feedback . Privacy

Post on Medial

Gireendra Varma

Stealth • 5m

I have a doubt let's take a company got recently funded in exchange of let's take 10% and it's going well and doing business also, after 5years company started declining almost came to shutdown the company. Now my question is : 1)Does company founders need to pay money back to investors if company fails? 2) is their any legal issues need to face by founders ?

7 replies13 likes

Replies (7)

Anonymous 2

Stealth • 5m

Investors understand the risk; no repayment is needed. Legal troubles depend on whether there was any illegal activity or gross negligence.

0 replies

Anonymous 1
•

Amazon • 5m

No, founders generally don't need to pay back investors if the company fails. Founders may face legal issues if there was fraud or mismanagement.

1 replies1 like

Saksham

Stealth • 5m

1. It depends upon the SSA, SSHA, SHA, SAFE and alike agreements that are drafted. In a general sense, the agreements are drafted in favour of the investors and the exit clause of the agreement is made where it's the company’s responsibility to provide an exit to the investor within a prescribed time. 2. No, the founders do not face any legal action in such scenario. In the eyes of law, the company and the founders are different entities and founders cannot be held liable for such cases. There is a principle "Lifting of the Corporate Veil" which provides cases where founders can be held liable. The mentioned case does not fall in that.

2 replies1 like

SHIV DIXIT

Stealth • 5m

if company facing downfall then Invester try to take exit and thier is no legal issues if you're registering your company in plc ( private limited company ) . Make sure you never sign any agreement with invester that allows him to take that money from you . Do everything in the name of your company and never sign anything personally

1 replies3 likes

Recommendations from Medial

Bappa Dittya Saha

Stealth • 18d

Don't sell on medial. Take help, Do some unpaid stuff, Exchange trust, build connection! Best for people looking for co-founders!

0 replies2 likes

Anonymous

Stealth • 3m

😗 Do you the meaning of speeding quality time with boss in exchange of joining letter ✉️ Pakistani company giving job to women's in exchange of spending quality time with company ceo.

0 replies4 likes

Anonymous

Stealth • 4m

India needs more women led founders, its truly inspiring! I think we need more benefits for companies led by women founders! Do we have women founders here at medial? Share your experience and company would love to hear about it!

5 replies4 likes

Sajin
•

Foundation • 2m

"It's good to be touchy about the industry you belong to" -Nikhil Kamath This applies for startups, founders gets obsessed with their company and idea. Founders always need a reality check, it gives us better understanding and acceptance

1 replies3 likes

Anonymous

Stealth • 8m

What happens when a company fails to generate revenue after raising funds from a VC. Are the company owners obliged to any amount in return for investors And how will investor get an exit if the company is a loss making company

10 replies13 likes

Anonymous

Stealth • 7m

I wanted to start an e-commerce company, so I need Co-founders. For more details connect with me if you are interested. Have a good day!

3 replies4 likes

Mrityunjoy Saikia

Stealth • 6m

We're seeking co-founders with innovative vision. Let's chat! DM us to get the conversation.

6 replies1 like

Harsh Gupta

Stealth • 7m

Hi Medial family 👋 Let's have a discussion on why Facebook Fails to acquire youth but the Instagram succeed What you think 🤔 comment it down 👇

71 replies25 likes

Samrat Mukherjee

Stealth • 4m

🚨 HACK ALERT 🚨 Massive $234M Heist at WazirX Exchange! A total of $234.9M in funds have mysteriously moved to a new address, with each transaction's caller funded by Tornado Cash.🌪️💸 The suspicious address is already busy swapping $PEPE, $GALA,