 Morning Dispatch |
PE-VCs push structural reboot; Cred backers’ Meta gains
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Happy Friday! India’s PE-VC lobby is seeking a structural overhaul to woo foreign capital and fund managers. This and more in today’s ETtech Morning Dispatch.
Also in the letter:
■ WhatsApp’s new pricing power play
■ Corning’s India head on AI
■ ETtech Done Deals
India’s private equity and venture capital industry is lobbying for deep structural changes to draw in more foreign investors and fund managers.
What’s the change: Today, most alternative investment funds (AIFs) are set up as trusts. The industry now wants a simpler pathway to convert them into limited liability partnerships (LLPs), a structure global investors know well and prefer.
The AIF industry plans to present its case to the Joint Parliamentary Committee, which is taking public feedback before ratifying proposed changes to the draft Corporate Laws (Amendment) Bill 2026.
What’s an LLP? Introduced in 2008, the LLP has become a go-to vehicle for many entrepreneurs. It blends the flexibility of a partnership with the limited liability shield of a company.
Most AIF sponsors still choose trusts because they are quicker to set up, flexible and more private. But foreign managers and investors tend to favour LLPs, as trusts don’t offer clearly defined limited liability. LLP structures also reduce personal liability for managers compared to AIF trustees.
Expert take: “A migration to LLP would align India with global fund hubs, thanks to the control-liability framework clearly ring-fencing liability and lending greater comfort to managers and investors. However, the reform would be incomplete without corresponding changes to the Income Tax Act,” said Vishal Gada, founder of Aurtus, a transaction and regulatory consultancy.
Meta’s purchase of nearly $400 million worth of shares from Cred’s existing investors has emerged as one of the largest secondary liquidity events in India’s startup ecosystem in recent years.
Driving the news: Angel investors in the fintech firm have logged returns of 7-20x, while institutional investors have made 3-16x, according to people aware of the deal. The sale forms part of Meta’s $900 million investment in Cred, which values the company at about $4 billion.
Who sold:
WhatsApp is rolling out a new pricing model that could make chatbots powered by rival AI models like ChatGPT and Claude significantly more expensive for businesses, raising fresh competition concerns.
Driving the news: From October 1, conversations powered by third-party AI could cost nearly twice as much as those using Meta’s own AI. At present, WhatsApp does not charge for AI agents.
A sample pricing calculator, based on WhatsApp’s updated developer documentation published on July 1, shows that complex interactions using other bots could cost businesses up to $968 for 10,000 messages, depending on token usage. The same volume using Meta AI would cost around $400-$500.
Legal troubles: The pricing shift may draw antitrust scrutiny from Indian regulators, legal experts said. EU competition authorities have already penalised Meta on this front. In June, the European Commission said Meta is abusing its dominant position by banning third-party services like OpenAI’s ChatGPT and Anthropic’s Claude on WhatsApp.
Also Read: Centre asks Meta to pause WhatsApp username rollout
Sudhir Pillai, MD, Corning India
Materials science major Corning is betting on rapid growth in AI data centres to accelerate its India business, driven by strong demand for fibre, glass and connectivity solutions, managing director and country leader for Corning India, Sudhir N Pillai, told us.
Rising demand: According to Pillai, AI data centres are fuelling demand worldwide for thinner fibre and denser cabling, as they require about 10x more fibre than hyperscale data centres.
"Currently, our major focus is on data centres because they are big fibre guzzlers," Pillai said. "They need a lot of fibre, and they need a lot of glass from Corning. So, over the next few years, a lot of our focus will be on data centres: thinner fibre, denser cable and a much more efficient connector."
India expansion: Corning is setting up a new optical connectivity plant in Pune, which it expects to be operational by Q4 this year. The facility will produce specialised products for hyperscale and AI-driven data centres. With domestic demand rising, the company may scale up capacity.
Bhavin Turakhia, founder, Neo
Zeta cofounder launches AI startup: Bhavin Turakhia, serial entrepreneur and cofounder of SoftBank-backed fintech unicorn Zeta, has launched Neo, an AI-native work platform, committing $30 million of his own capital to the venture.
Battery recycler BatX Energies raises funds: BatX Energies, a battery recycling startup, has raised Rs 105 crore in a funding round led by IvyCap Ventures. The company plans to expand its recycling and refining capacity amid rising demand for critical battery materials driven by India’s electric mobility push.
Flipkart appoints Vinay Vaidya as SVP: The ecommerce platform announced the appointment of Vinay Vaidya as its senior vice president, technology for supply chain. Vaidya will lead technology and platforms across fulfilment services, seller experience, trust and safety, and marketplace. He will also drive innovation in logistics and AI-powered capabilities.
■ Claude helped a hacker find a way to issue tickets to almost every US music festival (Wired)
■ Sam Altman: This is how we can make AI safe for everyone (FT)
■ India is testing an alternative to Silicon Valley’s AI playbook (Rest of World)
Also in the letter:
■ WhatsApp’s new pricing power play
■ Corning’s India head on AI
■ ETtech Done Deals
From being a trust to gaining trust: AIFs call for switch to LLP model
India’s private equity and venture capital industry is lobbying for deep structural changes to draw in more foreign investors and fund managers.
What’s the change: Today, most alternative investment funds (AIFs) are set up as trusts. The industry now wants a simpler pathway to convert them into limited liability partnerships (LLPs), a structure global investors know well and prefer.
The AIF industry plans to present its case to the Joint Parliamentary Committee, which is taking public feedback before ratifying proposed changes to the draft Corporate Laws (Amendment) Bill 2026.
What’s an LLP? Introduced in 2008, the LLP has become a go-to vehicle for many entrepreneurs. It blends the flexibility of a partnership with the limited liability shield of a company.
Most AIF sponsors still choose trusts because they are quicker to set up, flexible and more private. But foreign managers and investors tend to favour LLPs, as trusts don’t offer clearly defined limited liability. LLP structures also reduce personal liability for managers compared to AIF trustees.
Expert take: “A migration to LLP would align India with global fund hubs, thanks to the control-liability framework clearly ring-fencing liability and lending greater comfort to managers and investors. However, the reform would be incomplete without corresponding changes to the Income Tax Act,” said Vishal Gada, founder of Aurtus, a transaction and regulatory consultancy.
Cred’s angels, institutional investors score big in Meta deal
Meta’s purchase of nearly $400 million worth of shares from Cred’s existing investors has emerged as one of the largest secondary liquidity events in India’s startup ecosystem in recent years.
Driving the news: Angel investors in the fintech firm have logged returns of 7-20x, while institutional investors have made 3-16x, according to people aware of the deal. The sale forms part of Meta’s $900 million investment in Cred, which values the company at about $4 billion.
Who sold:
- Micky Malka's Ribbit Capital sold shares worth about Rs 250 crore, while Peak XV Partners offloaded stock worth Rs 300-350 crore.
- RTP Global pared holdings worth Rs 100-120 crore, and Tiger Global sold shares worth about Rs 105 crore.
- Silicon Valley's General Catalyst and Belgian investor Sofina each sold shares worth Rs 60-70 crore.
- Investors could sell up to around 10% of their holdings. Cred employees are also expected to receive liquidity through an Esop buyback.
- The deal hands Cred’s early backers a sizeable cash exit, even after last year’s valuation reset, when the company raised capital at a $3.5 billion valuation, down from $6.4 billion in 2022.
- For venture funds, the transaction lands at a time when exits remain scarce and LPs are pressing hard for cash distributions.
WhatsApp pushing businesses towards Meta AI with new pricing model
WhatsApp is rolling out a new pricing model that could make chatbots powered by rival AI models like ChatGPT and Claude significantly more expensive for businesses, raising fresh competition concerns.
Driving the news: From October 1, conversations powered by third-party AI could cost nearly twice as much as those using Meta’s own AI. At present, WhatsApp does not charge for AI agents.
A sample pricing calculator, based on WhatsApp’s updated developer documentation published on July 1, shows that complex interactions using other bots could cost businesses up to $968 for 10,000 messages, depending on token usage. The same volume using Meta AI would cost around $400-$500.
Legal troubles: The pricing shift may draw antitrust scrutiny from Indian regulators, legal experts said. EU competition authorities have already penalised Meta on this front. In June, the European Commission said Meta is abusing its dominant position by banning third-party services like OpenAI’s ChatGPT and Anthropic’s Claude on WhatsApp.
Also Read: Centre asks Meta to pause WhatsApp username rollout
Our focus is data centres because they are big fibre guzzlers: Corning's Sudhir Pillai
Materials science major Corning is betting on rapid growth in AI data centres to accelerate its India business, driven by strong demand for fibre, glass and connectivity solutions, managing director and country leader for Corning India, Sudhir N Pillai, told us.
Rising demand: According to Pillai, AI data centres are fuelling demand worldwide for thinner fibre and denser cabling, as they require about 10x more fibre than hyperscale data centres.
"Currently, our major focus is on data centres because they are big fibre guzzlers," Pillai said. "They need a lot of fibre, and they need a lot of glass from Corning. So, over the next few years, a lot of our focus will be on data centres: thinner fibre, denser cable and a much more efficient connector."
India expansion: Corning is setting up a new optical connectivity plant in Pune, which it expects to be operational by Q4 this year. The facility will produce specialised products for hyperscale and AI-driven data centres. With domestic demand rising, the company may scale up capacity.
Other Top Stories By Our Reporters
Zeta cofounder launches AI startup: Bhavin Turakhia, serial entrepreneur and cofounder of SoftBank-backed fintech unicorn Zeta, has launched Neo, an AI-native work platform, committing $30 million of his own capital to the venture.
Battery recycler BatX Energies raises funds: BatX Energies, a battery recycling startup, has raised Rs 105 crore in a funding round led by IvyCap Ventures. The company plans to expand its recycling and refining capacity amid rising demand for critical battery materials driven by India’s electric mobility push.
Flipkart appoints Vinay Vaidya as SVP: The ecommerce platform announced the appointment of Vinay Vaidya as its senior vice president, technology for supply chain. Vaidya will lead technology and platforms across fulfilment services, seller experience, trust and safety, and marketplace. He will also drive innovation in logistics and AI-powered capabilities.
Global Picks We Are Reading
■ Claude helped a hacker find a way to issue tickets to almost every US music festival (Wired)
■ Sam Altman: This is how we can make AI safe for everyone (FT)
■ India is testing an alternative to Silicon Valley’s AI playbook (Rest of World)
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