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United States securities and exchange commission logo
July 14, 2022
Arshia Sarkhani
Chief Executive Officer
Asset Entities Inc.
100 Crescent Ct, 7th Floor
Dallas, TX 75201
Re: Asset Entities Inc.
Amendment No. 1 to
Draft Registration Statement on Form S-1
Submitted June 27,
2022
CIK No. 0001920406
Dear Mr. Sarkhani:
We have reviewed your amended draft registration statement and
have the following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments. References to prior comments refer to comments in our June 3,
2022 letter.
Amendment No. 1 to DRS on Form S-1 submitted June 27, 2022
Prospectus Summary, page 1
1. In response to prior
comment 6, you revised page 29 to disclose your number of paying
subscribers during each
financial period included in your financial statements. In your
summary, you disclose
your number of members as of June 2022. Please revise your
summary to also
disclose your number paying subscribers during the most recent financial
period and provide your
definitions of paying subscribers and members.
Dual Class Structure, page 4
2. Disclosure added in
response to prior comment 3 states that your Class A common stock
is entitled to 10 votes
per share while your Class B common stock is entitled to 1 vote per
Arshia Sarkhani
FirstName LastNameArshia Sarkhani
Asset Entities Inc.
Comapany
July NameAsset Entities Inc.
14, 2022
July 14,
Page 2 2022 Page 2
FirstName LastName
share. Please revise to disclose, if true, that the difference in
voting rights is the only
difference between these classes of common stock. If there are other
differences between
these classes of common stock, such as differences in conversion
rights or economic
rights, please revise to disclose these differences here and in your
Description of
Securities section.
Certain Relationships and Related Party Transactions, page 60
3. We note your response to prior comment 9. Please tell us whether there
are any
management or other material agreements in place between Asset
Entities Holdings, LLC
and Asset Entities Inc., and if so, please file any such agreement.
General
4. We note your responses to prior comments 12-15. As an important
threshold matter,
please note that the provision of disclaimers to users, in and of
itself, does not necessarily
impact whether, as a legal matter, the company is providing advice to
others or issuing
reports or analyses regarding securities. Accordingly, and based on
the information you
have provided, it appears that the company meets the general
definition of an investment
adviser in Section 202(a)(11) of the Investment Advisers Act of 1940
(the Advisers
Act ). The company does appear to be providing advice to others or
issuing reports or
analyses regarding securities, including in the form of analyses of
stocks. The company
also appears to be in this business because, for example, the
provision of advice, reports,
and/or analysis appears to be the company s primary and ongoing
activities, and the
company does appear to receive compensation in the form of, for
example, subscription
fees. As a result, it appears that the company must be eligible for an
exclusion from the
general definition in Section 202(a)(11) in order to avoid incurring a
registration
obligation under the Advisers Act and potentially under relevant state
laws. Please note
that the risk factor disclosure on this point at page 17 (and any
other location in the
registration statement) will therefore need to be revised.
5. With respect the company s position that it is entitled to rely on
the publisher s
exclusion under Section 202(a)(11)(D) of the Advisers Act, and
given the comment
above on the use of disclaimers, please:
Describe in additional detail the information produced in
response to (i) comments or
requests of users, including responses to questions in chat or
other social media
interactions on Discord or other platforms and (ii) responses
to requests for
illustrative examples of securities analysis.
Describe in additional detail what is meant by, and included
within, the company s
provision of custom indicators to its users.
Describe in additional detail whether and how the company
modifies or tailors its
services after learn[ing] how the company s education and
entertainment services
Arshia Sarkhani
Asset Entities Inc.
July 14, 2022
Page 3
can meet a member s goals, including whether and how the
company produces
information or other content that addresses the user s requests or
goals.
Clarify whether the information described in the above three
bullet points is provided
by company personnel or the company s independent contractors, and
whether this
information is provided on Discord or another platform.
Address why you believe that responses to requests or comments
from users (i) are of
a general and impersonal nature that is not individualized
advice tailored to the
user s particular investment objectives, and (ii) are published in
general and regular
circulation and on a routine or periodic basis, in light of their
apparent timing in
response to user requests.
You may contact Morgan Youngwood, Senior Staff Accountant, at (202)
551-3479 or
Stephen Krikorian, Accounting Branch Chief, at (202) 551-3488 if you have
questions regarding
comments on the financial statements and related matters. Please contact
Mitchell Austin, Staff
Attorney, at (202) 551-3574 or Jan Woo, Legal Branch Chief, at (202) 551-3453
with any other
questions.
Sincerely,
FirstName LastNameArshia Sarkhani
Division of
Corporation Finance
Comapany NameAsset Entities Inc.
Office of
Technology
July 14, 2022 Page 3
cc: Louis Bevilacqua
FirstName LastName