Namaste, Sat Sri Akaal, and Salaam. 🫡

Happy morning, folks!

Today we’re diving into -
- Sequoia’s bet on Neo to fuse Wealth + Asset management,
- SEBI’s warning shot to deceptive finfluencers,
- And, Haldiram’s latest revenue milestone.

Our read time today is 4 minutes and 52 seconds - faster than Yo Yo Honey Singh shocked the world in 2010. 🔥

Let's dive in. 👇

Market Vibe Check

Neo nabs $36mn to fuse AM and WM. 💸

TLDR -
- Neo Asset Management just picked up $36mn from Sequoia (sorry, Peak XV 😂)
- They’re basically “extended CIOs” - offering tailored financial advice instead of focusing on selling products.
- Any player that can come into the market and address the massive trust deficit + incentive gap will be a BIG winner.

Sequoia just led a $36 million round in new-age WealthTech startup Neo.

They sell an “extended CIO” service - participating in investment committees, offering views on asset allocation, and improving corporate structures for a fee.

Neo services businesses, family offices, and HNIs - and already has 1000+ paying customers.

India is the country with the 2nd highest number of HNIs (high net-worth individuals), but our wealth management sector is still pretty underdeveloped.

A lot of finance companies focus more on selling “products” like mutual funds, structured derivatives, etc instead of selling tailored financial advice.

This leaves a big gap in the market for someone who can come in and do business in a way that fills up the trust deficit and clears away the misaligned incentives.

Neo already has over $3 billion of assets under management and is focusing on hardcore tailored services over a one size fits all approach.

Big money… 🚀

SEBI slaps a quick fix on the finfluencer problem. 🩹

TLDR -
- Finfluencers cannot legally promote regulated entities’ financial products.
- The long-term solution for problems like this is financial literacy. Full stop.
- You now need to register with SEBI if you wanna do ads/promo Indian-regulated financial products.

Of late, finfluencers have been everywhere.

They’re telling you the best stocks to buy on Twitter, the best credit cards to get on Insta, and the best mutual funds to invest in on LinkedIn.

A little bit of profile engineering is all it takes to sound smart, and smart-sounding people build audiences fast.

They then pass on literal financial advice to their followers.

This “advice” can be very dangerous.

Some cases recently -
- A penny stock CEO paid finfluencers to promote his shares. When the price soared, he sold at the top while everyone who bought was left holding the bag.
- A finfluencer promoted a credit card as which had 1000s in hidden fees.
- A scam operator teamed up with finfluencers to direct users to a website which prompted them to “send money and receive double”

This is obviously horrible for the victim, and it’s all because of poor financial literacy.

To combat this, SEBI’s said that -

Regulated entities CANNOT promote investment products, shares, or securities with UNREGULATED entities.

In short, they’ve killed the entire finfluencer business model overnight.

Crazy… 🚀

Haldirams drubs Pepsi at their own game. 🍟

Still growing at a 20% year-on-year rate - Haldiram’s Packaged Snacks is killing it.

They just crossed over 9200 Cr ($1.1 billion) in ARR, slightly eking out Pepsi’s India revenue.

A while back, Tata Consumer tried buying Haldirams but the deal fell through due to a disagreement on pricing.

They were asking for $10bn, but that was Tata Consumer’s valuation alone.

Masaledar stuff…

In other news… ☕

Netflix raises prices after cracking down on password sharing (FT)

South Korea arrests a CEO for manipulating a K-Pop agency’s share price (BBG)

CVC private equity gets ready to go public next week (FT)

Elon Musk warns that Cybertruck won’t be profitable till 2025 (TC)

OpenAI gets ready to sell ESOPs at a $86bn valuation (BBG)

And that’s the tea the chai for today.

Thanks for reading, and we hope you enjoyed it. Have a mauj-masti filled day.

Lots of ❤️,

Team Cutting Chai