Hey folks!

You walk into your favourite dhaba, order a plate of tandoori parathas, and when they arrive… they just don’t hit the same. The smoky flavour? Gone. The magic tandoor? Replaced.

That might soon be reality. Because Mumbai is planning to ban traditional charcoal tandoors. The Bombay High Court and the BMC want restaurants to ditch coal and charcoal for electric or gas cooking by July 8th. And thousands of eateries across the city are affected.

But here’s where things get a little bit… well, charred.

It began with the court asking bakeries using wood to switch to greener fuels. But the BMC bundled charcoal in with coal, labelling both as polluting fuels. The thing is, coal and charcoal aren’t the same thing. Coal’s a fossil fuel, full of ash and sulphur. Charcoal, on the other hand, is made by heating wood without oxygen. It burns cleaner, with way less smoke.

Even if we leave the science aside and talk about flavour, that char on your kebab? That rustic naan? It’s charcoal that gives it the punch. If legacy restaurants are forced to go electric, flavour might take a hit. So might business.

Now, the court has asked the Maharashtra Pollution Control Board to assess if charcoal really is polluting. Even NGOs and charcoal traders have been roped into the discussion.

Sure, Mumbai’s air needs cleaning. But cars, dust and construction are bigger culprits. Singling out tandoors may not fix that.

And if your kebab starts tasting bland soon… now you’ll know why.

But until then, let’s hope flavour, logic and climate action all find a way to co-exist!

Here’s a soundtrack to put you in the mood 🎵

Syndicate by Bipul Chettri

What caught our eye this week 👀

Did Nike just commit fraud?

Nike’s a fraudster!

That’s not us saying it, but a group of investors who’d put their money into Nike’s NFTs (Non-Fungible Tokens), or virtual sneakers.

To give you some context, NFTs like digital ownership certificates. They prove you own a unique digital item like art, music, videos or even virtual sneakers as in this case. And unlike regular files you can copy, NFTs are one of a kind and live on a blockchain, which keeps a permanent record of who owns what.

And back in 2021, Nike jumped onto this digital fashion hype. It bought a flashy studio called RTFKT (pronounced “artifact”) — a company making digital collectibles, especially sneakers you couldn’t wear but could definitely flex online. They could be traded on secondary markets and also came with other perks like gamified challenges, people creating their own sneakers, exclusive gifts, access to rare releases, all wrapped in NFT wrappers.

Nike wanted to woo Gen Z and gamers, and RTFKT gave them the shortcut. 

Buyers were excited too. They saw potential. And hoped that the value of these NFTs would grow over time.

But the excitement didn’t last. As the crypto market cooled, interest in NFTs faded and prices crashed. RTFKT struggled to keep people engaged or hold up the value of its assets. So in 2024, Nike shut it down, saying the studio wasn’t making enough money. They kept a website to showcase its work, but with all support gone, the NFTs lost their value. And what were once collectibles worth millions of dollars, were now practically worthless.

That’s when things got legal.

A bunch of investors have now sued Nike for over $5 million, claiming that the company “rug pulled” them. It’s a crypto slang for building hype, selling tokens fast and then vanishing after the cash flows in.

So how does the court decide if Nike committed fraud or if shutting down RTFKT was just a strategic exit?

Well, it boils down to whether these NFTs were just digital collectibles or actual securities like stocks and investments. Because if they were securities, Nike had some legal homework it didn’t do.

This is where the Howey Test comes in. It's a legal checklist from a 1946 US Supreme Court case that decides if something counts as a security and has 4 parts:

1. Are people putting in money or something valuable?
2. Are they pooling money with others or depending on a shared project?
3. Are they expecting to make profits?
4. Will the profits mainly come from someone else’s work or management?

If the answer is “yes” to all four, it’s a security. And Nike should’ve registered it, played by the rules, and probably kept the project alive longer.

Now, investors who filed the lawsuit will likely argue that Nike’s marketing created the expectation that it would continue supporting and growing the NFT project. They’ll point to the gamification and perks Nike promised, suggesting that these efforts were meant to increase the value of the NFTs. And that shutting it all down abruptly left them holding the bag.

Nike will likely deny these claims, arguing that the RTFKT NFTs were just collectibles, not securities, which is why they didn’t register them with the SEC. They’ll also argue that they had no obligation to continue supporting the project once it became financially unviable.

The thing is, NFT regulation is still murky. And unless the court decides that these tokens count as securities, investors may struggle to prove Nike broke the law.

But if they do win, it could make brands hesitant to launch NFT projects in the future. No company wants to get stuck having to support a collection indefinitely just to avoid a lawsuit.

And we’ll have to wait and see how the court handles this and whether Nike shakes off its “fraudster” label.

Infographic 📊

This Day in Financial History 📜

29th of April, 2004 — Google files for its IPO (and rewrites the rules of Wall Street!)

It’s the summer of 2004. Facebook is still just a Harvard experiment. Amazon mostly sells books. And the idea of asking a search engine to find your soulmate, order pizza, or write an essay sounds absolutely bonkers.

But on April 29, something game-changing happens.

Google — the quirky search engine with a clean homepage and an even cleaner motto (“Don’t be evil”) — decides to go public and files for its IPO. But it wasn’t your typical IPO.

Instead of letting big investment banks price the stock and hand it over to their favourite institutional buddies, Google ran what’s called an auction process.

Its filing said…

The price to the public and allocation of shares will be determined primarily by an auction process. As part of this auction process, we are attempting to assess the market demand for our Class A common stock and to set the size and price to the public of this offering to meet that demand. Buyers hoping to capture profits shortly after our Class A common stock begins trading may be disappointed. 

Basically, anyone — from seasoned fund managers to a grandma in a town — could bid for shares. The idea was to let the market decide the price. Level the playing field. Flip the script.

And flip it did.

The shares were priced at $85. People scoffed. Some even called the bidding process arrogant. The press mocked the move, analysts weren’t impressed, and the IPO got delayed thanks to a Playboy interview featuring Google’s founders (yup, that actually happened). The issue was that the interview may have violated the “quiet period” rules.

But on debut day, Google shares jumped 18% and closed over $100. And just like that, Google was on the markets.

Now here’s the fun part — if you invested $1,000 in Google back then, your shares of Alphabet (the search giant’s new name and also its parent) would have ballooned to $65,000 by August last year.

And come to think of it, that’s the power of backing the internet’s quietest revolutionaries. Because Google didn’t stop at search. Over the next two decades, it became the foundation of the modern internet. It runs the world’s most-used mobile operating system (Android), dominates the online ad industry, redefined maps, gobbled up YouTube, launched Gmail, and now leads the AI race with DeepMind and Gemini.

Today, Google — or Alphabet, its parent company — is worth over $2 trillion in market capitalisation!

Sure, the journey hasn’t been all good. Google faced antitrust scrutiny, with the US Department of Justice pushing for the breakup of its digital advertising business, citing monopolistic practices. Despite legal hurdles, Google's innovative ventures, including its foray into artificial intelligence and cloud services, continue to shape the digital landscape.

But funnily enough, all those critics back in 2004 who said going public would make Google lose its soul? Turns out, they were mostly wrong. The company still bets on moonshots. It still annoys Wall Street with big R&D spends. And it still builds new stuff like self-driving cars.

So yeah. Being unconventional could be the best kind of business strategy sometimes. Especially when the internet is just getting started!

Readers Recommend 🗒️

This week, our reader Gunjan Chitlange recommends reading “An Immense World” by Ed Yon, a book that explores how animals experience the world through their unique senses.

From elephants hearing with their feet to dogs navigating with their sense of smell and bees seeing ultraviolet, Yong reveals just how different their realities are from ours. It also encourages us to think more carefully about how we affect other creatures’ sensory worlds — from artificial light to noise pollution.

Thanks for the rec, Gunjan!

That’s it from us this week. We’ll see you next Sunday!

Until then, send us your book, music, business movies, documentaries or podcast recommendations. We’ll feature them in the newsletter! Also, don’t forget to tell us what you thought of today's edition. Just hit reply to this email (or if you’re reading this on the web, drop us a message: morning@finshots.in).

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