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29 Mar 2024, Edition - 3181, Friday

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Business

New millionaires from Walmart-Flipkart deal have wealth managers buzzing!

businesstoday.in

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The newly-minted millionaires spawned by the $16 billion Walmart-Flipkart deal are busy looking for parking spots for their newfound wealth, and wealth managers and financial services startups are making a beeline for them.

As per Walmart’s filings with the US Securities and Exchange Commission, it is obligated to purchase ESOPs worth $800 million from Flipkart’s past and present employees in tranches. A chunk of that was doled out to the employees of the ecommerce giant as well as its units Myntra and PhonePe late last month, resulting in a windfall for plenty of folks. So what are the top beneficiaries planning to do with this money?

“Largely there are three buckets where Flipkart people are spending,” Ankit Nagori, CureFit co-founder and former Flipkart chief business officer, told the daily. “One is on buying cars and bikes and similar luxury items. Secondly, a bunch of people are investing in mutual funds and other investment vehicles. And third, the top earners will invest in startups and become LPs (limited partners) in venture funds.”

For instance, Flipkart co-founder Sachin Bansal, who made $1 billion from his stake sale to Walmart, is reportedly in talks to invest in homegrown cab aggregator Ola and electric scooter startup Ather Energy.

The wealth creation event, the largest in Bengaluru since the historic listing of software giant Infosys Ltd in the late 1990s, has also spawned new business opportunities. Consider Groww for instance. This investment platform, started by former Flipkart employees, launched an investment product with the title “Better Than FD (fixed deposit) for ESOP and Bonus Money” on the day Walmart paid out cash to Flipkart employees. According to Lalit Keshre, the platform’s chief executive and a former senior product executive at Flipkart, more than 250 people have invested in the new product.

Another personal finance and wealth management platform, Upwardly, which was started by former Myntra executive Prateek Mehta, has reportedly seen a few hundred Flipkart employees approach it for investment advice over the past month.

“The ones who have had significant payouts are looking at angel investment or portfolio management,” a Flipkart employee told the daily. “IIFL and other wealth management guys have been making a beehive for senior management at Flipkart, Myntra and PhonePe to manage their wealth. They [employees who received the least] are spending on paying off home loans or buying their first home.” At least a dozen employees have reportedly booked new apartments in high-rises coming up in Bengaluru’s startup belt spanning Koramangala, HSR and Sarjapur.

Of course, not all are looking at growing their newfound wealth – many are looking at luxury spends, too. Several employees told the daily that they had started planning vacations abroad, among other things.

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