Zerodha – 0 to 1 Billion Dollar Company

In just 10 years, Zerodha went from 0 to 1 billion dollars in valuation. 

But how and what is Zerodha?

Zerodha is a financial service company founded by two brothers Nithin Kamath and Nikhil Kamath in the year 2010 to make trading barrier-free in the Stock Market. The name Zerodha comprises two terms, ‘Zero’ and ‘Rodha’. The latter term has been taken from Sanskrit, combining it with zero gives the meaning ‘barrier free’. 

All of this was done with zero funding and zero marketing. That means Zerodha went from 0 to 1 billion dollars in valuation with zero marketing and zero funding. In today’s competitive world where companies are pouring millions of money for advertisement just to be in the market here, Zerodha built his empire with zero funding and zero marketing.

Nithin and Nikhil Kamath

The Idea Behind Zerodha

In 2016, Kunal Shah – one of the most legendary entrepreneurs in the Indian startup ecosystem, deliberated an ink talk where he proposed a very interesting theory which more or less explains the root cause of the success of some of the biggest startups in the world.

According to Kunal Shah, “in this world, there are terms of system which have a term of inefficiencies and hurdles which often prevent ordinary people like you and me from moving into a more efficient system but we human beings once we find an efficient system, we have this innate ability to move on from where we never ever come back.”

Before Zerodha, Nikhil Kamath observed that three hurdles were troubling the investors and were also preventing the common people of India from investing in the stock market.

These hurdles were – 

  • Lack of knowledge and awareness – People in India make decisions based on myths rather than knowledge and strategy.

  • Exorbitant brokerage fees – As the conventional brokerage forms for charging percentage commission, all the amount of investment that in investing was made which results in exorbitant brokerage fees.

  • The entire process of investment was very tedious and complex for a common man to understand.

“The problem we are trying to solve with this is how to grow the capital market ecosystem in India. It can only happen through educating people on a platform which has content and engagement both,” Nithin said.

That is why they came up with three unique solutions which turned Zerodha into billion-dollar company

  • Tackle the lack of knowledge and awareness – To educate the Indian population about investment in stocks, they came up with something called Zerodha Varsity, which is an investor education platform wherein customers can enhance their knowledge and skills on trading and investments.

  • Discount the brokerage fees to such a large extent that it results in it into revolution. They came up with a super affordable price of 20 rupees or 0.03% which is even less for all intraday trades and they charge 0 fees for all equity and direct mutual fund investments.

  • To resolve the tedious process of investment, they came up with a website with a simple user interface which any common man can get familiar with the entire process of investment.   

Now Zerodha is India’s first discount brokerage firm with over 8.5 lakh active clients.