MC Investigates: Startup founder under fire for financial impropriety plans next venture

Team Sateeq informed Moneycontrol that the platform "ceased facilitating fresh investments as soon as regulatory authorities raised concerns about similar structures executed by other companies". (Photo by Ravi Roshan/Pexels)

A young entrepreneur known for launching a platform to invest in private enterprises at 16 is facing allegations of financial impropriety from investors as he prepares to launch a new financial services venture.

Krishna Maggo, founder of the investment platform Sateeq, launched in 2022, has been promoting his next venture, Altitude.Club. While Sateeq focused on raising equity for startups, Altitude.Club claims to be a way to invest in high-yield, fixed-income products.

Maggo’s new venture, Altitude Club, according to Tracxn and media reports, has raised $500,000 (around Rs 4 crore) at a valuation of $1.96 million (around Rs 15.6 crore) from “founders, operators and leaders from top institutions” such as Swiggy, Yes Bank, Robinhood and Wipro.

Earlier, Sateeq, according to Tracxn, saw one round of fundraising totalling $25,800 (approximately Rs 20 lakh) at a valuation of Rs 4.4 crore from Ullu founder Himanshu Periwal; InVoid founder Sarthak Goel; Vaibhav Jalan, formerly with Smallcase and now chief business officer at Zerodha Fund House; and institutional investors such as Mumbai Angels, Shanghai Ivy Capital and Singhvi Heritage.

Altitude.Club tagline is “Think mutual fund, but for alternative assets”. It claimed to be “set” for a debut on a leading stock exchange with its “first Structured Investment Scheme called Altitude Prism Fund”. Maggo also promoted his fund through interviews with leading media outlets.

However, several investors who spoke to Moneycontrol claim that they have no way to find out what happened to their investments routed through Sateeq and allege that they are not getting any response to their queries from the company's management.

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Moneycontrol wrote to Maggo through the email ID given to investors on Sateeq. We received an email response from Team Sateeq and it said that the platform “facilitated fundraising campaigns” for 12 companies but it did not give any details of the funds raised or the returns generated for the investors and added that the risks associated with equity investment in early-stage startups were well known to the investors.

“Every investor who invested through Sateeq did so with a clear understanding of the risks associated with investing in early-stage companies,” Sateeq said.

“Sateeq ceased facilitating fresh investments as soon as regulatory authorities raised concerns about similar structures executed by other companies. Notably, some investments facilitated through Sateeq have performed well, although exits cannot be expected in such short timeframes for early-stage entities. Sateeq acted merely as a vehicle provider and technology interface for these fundraisers without acting as an agent for any of the companies that raised funds. The invested funds were never deposited into Sateeq accounts but were held in escrow, with all transactions executed directly between investment vehicles and the investee companies.”

According to the platform, they have “taken necessary steps to ensure that all investors holding a portfolio through Sateeq’s platform are well-informed about the status and performance of their investments”.

But investors Moneycontrol spoke to said that they have been kept in the dark about the progress of their investments so far. They did not want to be identified in the article to protect their privacy.

Sateeq’s website, which was not being used by its owner for a while (it was “parked free” with GoDadddy.com), now carries a note to the investors. It says they are “navigating some regulatory adjustments” to enhance their services and continue to serve the investor better”.

Earlier...

Now...

Maggo’s recent venture Altitude Club’s website from its LinkedIn profile…

…also led to nowhere for a while...

...and now the website address on Altitude's LinkedIn profile has been replaced with Sateeq's.

Sateeq’s email said that Altitude has not yet been launched and that no money has been raised from anyone. The email said, “The aim was to establish a diversified basket of alternative investment opportunities using the Securitised Debt Instrument structure, which can be listed on stock exchanges and regulated by the appropriate authorities. Unfortunately, due to the complexity involved in developing such a financial instrument, we had to suspend further research and implementation efforts.”

Investors speak

A person who invested Rs 70,000 through Sateeq, on condition of anonymity, shared why he invested through the platform and why he believes he has been cheated out of his money.

He invested most of the money in tranches of Rs 10,000 each over 2021-22 because the platform’s website looked authentic and because there were media articles. Media articles named prominent angel investors who were associated with the platform, but one of the angel investors told Moneycontrol (under the condition of anonymity) that he had only invested in the platform as a friend and had not approached it like his regular investments that require rigorous due diligence.

Another investor who spoke to Moneycontrol and had invested a similar amount said that Sateeq caught his eye because of ads online and through LinkedIn posts when all such platforms “were a rage” and that he believed in the promise because he assumed that they would be well-governed like stock exchanges and mutual-fund houses and because the startups listed on the platform were reasonably popular.

But soon, in a matter of months, both investors found out that they may have been cheated out of their money.

One of the investors told Moneycontrol that two of his tranches of money totalling Rs 20,000 were supposed to be refunded in 2022 because the startup he chose to invest couldn’t take the money.

He lost track of his investment when there was a health crisis in the family. But later, when he saw mail regarding the refund of his money and checked his bank accounts, he realised that no money had been credited. From February 21, he has been writing to the platform’s team asking for an update about the refund.

Initially, they did respond to him through an email dated March 3, in which they asked him to give them three to four days to get back to him and telling him that his refund was processed in September 2022.

He reverted immediately by saying that he checked his bank account and that no refund had been credited, but he didn’t receive a response to that mail or subsequent mails. When they stopped responding to his emails, and finally, his emails bounced, he realised that the platform may have been defrauding him. Moneycontrol has seen a copy of his correspondence with the platform, and it shows a mail from Team Sateeq saying that his refund has been credited and his many emails to the team saying that the refund has not been reflected in his account, which remains unanswered.

The second investor’s doubts began to surface when the website began to crash frequently. He recalled his experience then: “I wrote to the team, and they responded saying that they were migrating. The website was live again, and then the frequency of the crashes increased, till the website finally stopped working”.

He said that he understood the investments were risky, but he hadn’t expected the whole enterprise to vanish. Now, he questions whether his money ever reached the startups he intended to support.

When one of the investors tried reaching out to Maggo via his LinkedIn profile on April 26, there was no response.