A Singapore startup said no to an investor. The investor sued, citing a breach of contract

When Lumiere32, a business-to-business medical supplies marketplace based in Singapore, won the C-Shark Tank pitching competition in March, it meant that it would get S$300,000 in funding from a syndicate of angel investors.

But the funding’s term sheet, which was presented post-competition by She1K, the event’s organizer, wasn’t to the startup’s liking, multiple sources with knowledge of the situation tell Tech in Asia. When further negotiations proved unsuccessful, its founders declined the investment.

Lumiere32 founders Priti Bhole (left) and Raman Chauhan (right) / Photo credit: Lumiere32

Days later, they were hit with a lawsuit, citing a breach of the event’s participation agreement, which stated the investment terms and disallowed the startup from backing out of it. The amount they’re being sued for? S$900,803.

Drew and Napier, a leading legal firm in Singapore that is representing She1k, says its client is unable to comment as the case is ongoing. It adds that the events described by our sources are “inaccurate and paint a skewed picture of the issues in dispute.”

Lumiere32 founders Raman Chauhan and Priti Bhole, along with their lawyers at Dentons Rodyk, one of Singapore’s largest law firms, also declined to comment.

Participation agreement

Singapore-based She1K is the brainchild of Christina Teo, a veteran of companies like IBM and Yahoo. It aims to introduce female C-suite executives into the world of angel investing.

It counts Enterprise Singapore, a statutory board under the city-state’s Ministry of Trade and Industry, as a partner.

At launch, She1K planned to create a US$2 million fund – pooled from its members – that will invest in seed-stage startups in exchange for equity. One way it finds startups is through C-shark Tank, a pitching competition similar in concept to the television show Shark Tank.

The inaugural C-shark Tank program happened earlier this year. One of the 12 finalists – and the eventual winner – is Lumiere32.

Founded by the husband-and-wife team of Chauhan and Bhole, Lumiere32 provides a one-stop shop for healthcare providers across the region. It is also incubated by NUS Enterprise.

According to sources, the founders and She1K discussed the term sheet after the event. Both parties were unable to reach an agreement, however, even after discussing the possibility of using other investment instruments such as a convertible note.

Soon after that, the founders received notice of the lawsuit, in which She1K is suing Lumiere32 for S$900,803 – more than three times the amount that the angel network had planned to invest.

A costly battle