A. Kubhera Enterprises, LLC (the “Registrant”) is a limited liability company formed on
August 21, 2009 in the State of New Jersey. The Registrant is owned by Jishnu, LLC,
Vyasa, LLC, and ELS3, LLC; each respectively owned by Venkat Krishnaswamy, Ganga
Mukkavilli and Ethan Schneid. Jishnu, LLC is the Registrant’s Managing Member.
B. As discussed below, the Registrant offers to its clients (individuals, business entities,
trusts, estates and charitable organizations, etc.) investment advisory services, and, to the
extent specifically requested by a client, financial planning and related consulting
services.
INVESTMENT ADVISORY SERVICES
The client can determine to engage the Registrant to provide discretionary and/or non-
discretionary investment advisory services on a fee basis. To the extent specifically
requested by the client, the Registrant also provides financial planning and consulting
services. In the event that the client requires extraordinary planning and/or consultation
services (to be determined in the sole discretion of the Registrant), the Registrant may
determine to charge for such additional services, the dollar amount of which shall be set
forth in a separate written notice to the client.
PRIVATE INVESTING THROUGH YIELDSTREET INC.
For those clients who elect to participate and execute an amendment to their Investment
Advisory Agreement, this service will provide the Registrant with discretionary authority
to purchase (and to the extent permitted by YieldStreet and the investment sponsor, sell
or redeem) private investments for the benefit of the client through the YieldStreet
platform. Prior to investing on the YieldStreet platform, the Registrant will assist the
client in determining an appropriate asset allocation to alternative investments. Clients
are ultimately responsible for accepting any recommendation and authorizing the specific
dollar amount to invest through the YieldStreet platform. Once assets are available for
investing in the client’s YieldStreet account, the Registrant is authorized to purchase one
or more investments available on the platform.
While the Registrant may perform due diligence on investments that are available outside
the YieldStreet platform, by participating in Private Investing Through YieldStreet Inc.,
clients accept that they may only be recommended investments through the YieldStreet
platform, which creates a limited universe of investing opportunities.
FINANCIAL PLANNING AND CONSULTING SERVICES (STAND-ALONE)
The Registrant may be engaged to provide financial planning and/or consulting services
(including investment and non-investment related matters, including estate planning,
insurance planning, etc.) on a stand-alone separate fee basis. Prior to engaging the
Registrant to provide planning or consulting services, clients are generally required to
enter into a Financial Planning and Consulting Agreement with Registrant setting forth
the terms and conditions of the engagement (including termination), describing the scope
of the services to be provided, and the portion of the fee that is due from the client prior
to Registrant commencing services. If requested by the client, Registrant may
recommend the services of other professionals for implementation purposes, including
the Registrant’s representatives in their capacities as licensed insurance agents of
Kubhera Risk Management, LLC and/or as Certified Public Accountants (“CPA”). (See
disclosures at Item 10.C). Clients are under no obligation to engage the services of any
recommended professional, who are solely responsible for the quality and competency of
the services they provide. It remains the client’s responsibility to promptly notify the
Registrant if there is ever any change in their financial situation or investment objectives
for the purpose of reviewing, evaluating or revising Registrant’s previous
recommendations and/or services.
RETIREMENT PLAN CONSULTING
The Registrant also provides retirement plan consulting services, pursuant to which it
assists sponsors of self-directed retirement plans with the selection and/or monitoring of
investment alternatives (generally open-end mutual funds) from which plan participants
shall choose in self-directing the investments for their individual plan retirement
accounts. In addition, to the extent requested by the plan sponsor, the Registrant shall
also provide participant education designed to assist participants in identifying the
appropriate investment strategy for their retirement plan accounts. The terms and
conditions of the engagement shall generally be set forth in a Retirement Plan Consulting
Agreement between the Registrant and the plan sponsor.
MISCELLANEOUS
Limitations of Financial Planning and Non-Investment Consulting/Implementation
Services. As indicated above, to the extent requested by a client, Registrant may provide
financial planning and related consulting services regarding non-investment related
matters, such as estate planning, tax planning, insurance, etc. Registrant does not serve
as an attorney or accountant, and no portion of its services should be construed as legal or
accounting services. Accordingly, Registrant does not prepare estate planning documents
or tax returns. To the extent requested by a client, Registrant may recommend the
services of other professionals for certain non-investment implementation purpose (i.e.
attorneys, accountants, insurance agents, etc.), including representatives of Registrant in
their separate individual capacities as licensed insurance agents and/or as CPAs. Clients
are under no obligation to engage the services of any recommended professional, who are
solely responsible for the quality and competency of the services they provide. The
recommendation by Registrant’s representative that a client purchase an insurance
commission product through Registrant’s representatives presents a conflict of interest, as
the receipt of commissions provides an incentive to recommend insurance products based
on commissions to be received, rather than on a particular client’s need. No client is
under any obligation to purchase any insurance commission products through such a
representative. Clients are reminded that they may purchase insurance products
recommended by Registrant through other, non-affiliated insurance agencies.
Registrant’s Chief Compliance Officer, Venkat Krishnaswamy, remains available to
address any questions that a client or prospective client may have regarding the
above conflict of interest.
Affiliated Private Investment Fund. For clients that are accredited investors and
qualified clients (as those terms are defined under federal securities law), the Registrant
may recommend an investment in an affiliated private investment fund—Kubhera India
Infrastructure Fund LP (the “affiliated private fund”). An affiliate, Kubhera Capital LLC
serves as the general partner of the affiliated private fund. The Registrant or an affiliate
serves as the investment adviser of the affiliated private fund. The Registrant treats the
affiliated private fund as subject to its policies and procedures and all the substantive
provisions of the Investment Advisers Act of 1940, as amended. The terms and
conditions of investing in the affiliated private fund, including management fees,
conflicts of interest, and risk factors, are set forth in the affiliated private fund’s offering
documents. Clients that invest in the affiliated private fund will incur an asset-based
management fee, which increases as the performance of the fund increases. Depending on
the amount of assets that the Registrant manages for a client, the fee stated in a client’s
Investment Advisory Agreement, and the performance of the affiliated private fund, the
Registrant and its affiliates stand to earn compensation from the affiliated private fund
that may be less than, equal to, or exceed the fee that a client may incur for assets
invested according to an Investment Advisory Agreement. However, clients will not
incur both layers of fees for assets invested in the affiliated private fund. They will only
incur the management fees of the affiliated private fund. This relationship and fee
structure creates a conflict of interest. The Registrant seeks to mitigate this conflict of
interest by (1) disclosing it to clients and prospective clients, and (2) generally seeking to
recommend the affiliated private fund to investors that such an investment may be
appropriate. Nonetheless, the Registrant generally favors the affiliated private fund
over
other unaffiliate private funds with comparable investment objectives and strategies. The
Registrant’s clients are under no obligation to make an investment in the affiliated private
fund. The Registrant’s Chief Compliance Officer remains available to address any
questions regarding this conflict of interest. For more information, see Items 4, 6, and 10
below.
Real Estate Investment Trusts. The Registrant may use or recommend the use of real
estate investment trusts “REITs” within the client’s portfolio. REITs are subject to risks
generally associated with investing in real estate, such as: possible declines in the value
of real estate; adverse general and local economic conditions; possible lack of availability
of mortgage funds; changes in interest rates; and environmental problems. In addition,
REITs are subject to certain other risks related specifically to their structure and focus
such as: dependency upon management skills; limited diversification; the risks of
locating and managing financing for projects; heavy cash flow dependency; possible
default by borrowers; the costs and potential losses of self-liquidation of one or more
holdings; the possibility of failing to maintain exemptions from securities registration;
and, in many cases, relatively small market capitalization, which may result in less
market liquidity and greater price volatility. No client is under any obligation to utilize
REITs within their portfolio. Clients are reminded that they may choose to restrict the
Registrant’s authority to purchase REITs for their investment portfolio.
Independent Managers. Registrant may allocate a portion of a client’s investment assets
among unaffiliated independent investment managers (“Independent Manager(s)”) in
accordance with the client’s designated investment objective(s). In such situations, the
Independent Manager(s) will have day-to- day responsibility for the active discretionary
management of the allocated assets. Registrant will continue to render investment
supervisory services to the client relative to the ongoing monitoring and review of
account performance, asset allocation and client investment objectives. The Registrant
generally considers the following factors when recommending Independent Manager(s):
the client’s designated investment objective(s), management style, performance,
reputation, financial strength, reporting, pricing, and research. The investment
management fees charged by the designated Independent Manager(s), together with the
fees charged by the corresponding designated broker-dealer/custodian of the client’s
assets, are exclusive of, and in addition to, Registrant’s investment advisory fee set forth
above.
Non-Discretionary Service Limitations. Clients that determine to engage the Registrant
on a non-discretionary investment advisory basis must be willing to accept that the
Registrant cannot effect any account transactions without obtaining prior consent to any
such transaction(s) from the client. Thus, in the event of a market correction during which
the client is unavailable, the Registrant will be unable to effect any account transactions
(as it would for its discretionary clients) without first obtaining the client’s consent.
Use of Mutual and Exchange Traded Funds: Most mutual funds and exchange traded
funds are available directly to the public. Clients and prospective clients can obtain many
of the funds that may be used by Registrant without engaging Registrant as an investment
advisor. However, if a client or prospective client determined to do so, they would not
receive the Registrant’s initial and ongoing investment advisory services. In addition,
mutual funds and exchange traded funds have internal expenses (i.e., management fees),
which are borne by all shareholders, in addition to the Registrant’s fees.
Portfolio Activity. Registrant reviews accounts periodically and as necessary to
determine if any changes are necessary based upon various factors, which may include,
but are not limited to investment performance, fund manager tenure, style drift, account
additions/withdrawals, and changes in the client’s investment objectives. Registrant may
determine that changes to a client’s portfolio are unnecessary. Clients are still subject to
the fees described in Item 5 below, even during periods of account inactivity.
Retirement Rollovers: A client or prospective client leaving an employer typically has
four options regarding an existing retirement plan (and may engage in a combination of
these options): (i) leave the money in the former employer’s plan, if permitted, (ii) roll
over the assets to the new employer’s plan, if one is available and rollovers are permitted,
(iii) roll over to an Individual Retirement Account (“IRA”), or (iv) cash out the account
value (which could, depending upon the client’s age, result in adverse tax consequences).
If Registrant recommends that a client roll over their retirement plan assets into an
account to be managed by Registrant, such a recommendation creates a conflict of
interest. No client is under any obligation to roll over retirement plan assets to an account
managed by Registrant. The Registrant’s Chief Compliance Officer, Venkat
Krishnaswamy, remains available to address any questions that a client or prospective
client may have regarding the conflict of interest presented by such rollover
recommendation.
eMoney Advisor Platform. Registrant may provide its clients with access to an online
platform hosted by “eMoney Advisor” (“eMoney”). The eMoney platform allows a client
to view their complete asset allocation, including those assets that Registrant does not
manage (the “Excluded Assets”). Registrant does not provide investment management,
monitoring, or implementation services for the Excluded Assets. Therefore, Registrant
shall not be responsible for the investment performance of the Excluded Assets. Rather,
the client and/or their advisor(s) that maintain management authority for the Excluded
Assets, and not Registrant, shall be exclusively responsible for such investment
performance. The client may choose to engage Registrant to manage some or all of the
Excluded Assets pursuant to the terms and conditions of an Investment Advisory
Agreement between Registrant and the client. The eMoney platform also provides access
to other types of information, including financial planning concepts, which should not, in
any manner whatsoever, be construed as services, advice, or recommendations provided
by Registrant. Finally, Registrant shall not be held responsible for any adverse results a
client may experience if the client engages in financial planning or other functions
available on the eMoney platform without Registrant’ assistance or oversight.
Cash Positions. At any time and for a substantial length of time, client accounts may
hold a significant portion of cash or money market mutual funds. Investments in these
assets may cause a client to miss upswings in the markets. Unless Registrant expressly
agrees otherwise in writing, account assets consisting of cash and money market mutual
funds are included in the value of an account’s assets for purposes of calculating its
advisory fee. A client can advise Registrant not to maintain (or to limit the amount of)
cash holdings in the client’s account.
Client Obligations. In performing its services, Registrant shall not be required to verify
any information received from the client or from the client’s other professionals, and is
expressly authorized to rely thereon. Moreover, each client is advised that it remains their
responsibility to promptly notify the Registrant if there is ever any change in their
financial situation or investment objectives for the purpose of reviewing, evaluating or
revising Registrant’s previous recommendations and/or services.
C. The Registrant shall provide investment advisory services specific to the needs of each
client. Prior to providing investment advisory services, an investment adviser
representative will ascertain each client’s investment objective(s). Thereafter, the
Registrant shall allocate and/or recommend that the client allocate investment assets
consistent with the designated investment objective(s). The client may, at any time,
impose reasonable restrictions, in writing, on the Registrant’s services.
D. The Registrant does not participate in a wrap fee program.
E. As of December 31, 2023 the Registrant had approximately $222,000,000 in assets under
management on a discretionary basis and $17,000,000 in assets under management on a
non-discretionary basis.