Trading has been feasible without barriers thanks to a business called Zerodha. It is the first cheap brokerage firm in India.
Zerodha has made a name for itself in the stockbroking sector in this digital age. The business has expanded solely on the basis of technology by providing worthwhile services to its clients.
Five individuals made up the first team of Zerodha, which currently numbers more than 1,200. The Kamath brothers’ original concept and excellent use of technology have elevated this business to the position it has today.
It is the top stockbroker in India, and the most well-known and significant online broker, and it provides services for investing in equities, foreign exchange, commodities, initial public offerings, and direct mutual funds.
In 2010, Zerodha, a provider of financial services, was established. It is an online discount broker whose major goal is to provide clients with reduced prices.
Additionally, it provides brokerage services to stock market participants and is a member of the NSE, BSE, MCX, and MCX-SX.
Zero and Rodha combine to form the name Zerodha. The latter phrase, which is derived from Sanskrit, means “barrierless” when combined with zero.
The business, which was the first bargain broker in the nation when it initially began operating, has its headquarters in Bangalore and a sizable customer base.
The two brothers Nithin and Nikhil Kamath launched the business in August 2010. The selected name is Zerodha, which combines the terms “Zero” and “Rodha,” the Sanskrit word for “barrier,” to represent the company’s values.
As of 2019, Zerodha contributed up to 2% of the daily retail volumes on Indian stock exchanges, making it the largest retail stock broker in India by active customer base.
Zerodha entered the “unicorn club” in June 2020 with a self-assessment of about $1 billion. The ESOP buyback exercise that the business did was the basis for this valuation, which valued each share at more than four times the book value of 700 per share.
The globe had a trade silence from 2008 to 2010 because to the world’s worst financial crisis. The few stockbroking firms that were still operating in India went out of business and were still employing antiquated technologies. Many members of the younger generation lacked the education necessary to consider trade at an early age.
While nearly every broker in India had to deal with all of these issues, Mr. Nithin Kamath launched Zerodha, a cheap brokerage business located in Bangalore, in 2010. Zerodha offers trading services with reasonable brokerage costs, a user-friendly interface, and dependability. With more than 2.5 million users, this company has a sizable customer base.
In this post, we’ll take a closer look at the route that led to Zerodha’s success and talk about how it grew to become the largest discount broker in India.
Who Found Zerodha
The two brothers behind this creative business concept are Nithin and Nikhil Kamath. While Nikhil is a talented trader who oversees the prop trading desk, risk management, and all other aspects of trading, Nithin is the eldest and the founder and CEO of Zerodha.
Since he was 17 years old, Nithin has had a strong interest in trading. He mostly engaged in stock market trading during his time in college. Even he engaged in trading during the day and worked at the call center at night.
As a result of his diligence and enthusiasm for trading, Nithin quickly acquired more clients through recommendations.
Zerodha Doesn’t Believe in Advertising
When it comes to stock marketing, the majority of people seldom make impulsive purchases. Users tend to be extremely cautious and attentive when trading because it includes investment and the potential for financial loss.
And the next reason why the majority of individuals favor stock market investments is greed. the desire to multiply one’s wealth. Zerodha studied their customers’ mindsets and realized that if stock marketing became an instinct, it wouldn’t be to their advantage. They then began to concentrate more on word-of-mouth advertising. The majority of Zerodha users are referred by other people.
Such users will remain interested in trading since they are determined to maximize their gains. They start investing in clients as a result, rather than concentrating on advertising
Features That Set Zerodha Apart in the Market
Zerodha’s strategy of first educating its consumers sets it apart from other customers. Unlike a full-service brokerage platform, Zerodha does not offer stock recommendations. New traders must first become familiar with the site’s operations before trading.
The ability of merchants to realize why they are going bankrupt or deal intelligently would be what drives an engaged consumer base. A similar objective guided the development of Zerodha Varsity in 2015, which also included a blog connection to increase website interest. The Varsity App and content in Hindi were both made available in 2019.
Then came LearnApp and Finception focuses on making financial content simple for its customers, whereas LearnApp charges users for access to finance knowledge, including videos chosen by top fund institution experts. By using ongoing partnerships, they have been able to further their educational objective.
The Kamath siblings do not charge for distribution or trade, in contrast to other businesses. Instead, they keep 10% of the investment’s profits as their own.