ET Startup Awards 2016: How the Bootstrap Champ Zerodha is taking investment to the masses

Zerodha founder Nithin Kamath began trading in stocks at the age of 17, often spending more time tracking share prices while attaining an engineering degree.
“This is the only thing I am good at. I have been in this space for 20 years, so the personal experience gives me an edge,” Kamath said after Zerodha won the Bootstrap Champ award. “The online trading and investment, fin-tech sector is a niche space, so getting attention is bound to happen when you are profitable in the first year.”

The online discount brokerage offers equity investment services, currency and commodity trading, and retail and institutional broking. A winner of the BSE/D&B ‘Emerging brokerage’ award in 2014 and 2015, Zerodha says it accounts for about 4% of the retail trade volumes on BSE and NSE. Zerodha’s strategy of making financial trading hassle-free has won it about 1,20,000 clients. In addition to this, the firm is adding 8,000-10,000 accounts a month. All this translates to revenue of about Rs 10,000 crore a day.

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The company made a profit of Rs 65 crore on revenue of about Rs 119 crore in 2015-16. Zerodha also offers mutual fund investment services and hosts three learning platforms— stock market education platform Zerodha Varsity; financial blog Z-Connect; and Trading Q&A that provides answers on trading from investors and traders. Kamath has also set up Rainmatter, an in-house incubator for financial technology startups.

Kamath says Zerodha will support innovative financial technology players through Rainmatter, which recently launched Smallcase, a thematic investment platform.

Satyan Gajwani, jury member and vice-chairman of Times Internet, said Zerodha was a clear winner in the Bootstrap Champ category. “It is a company that is making a lot of profit from the beginning. The impact of Zerodha is going to change trading and investing in the country. For me, (selecting Zerodha) was an easy decision,” said Gajwani. Zerodha will also enter the lending business, among the hottest sectors within fin-tech, before the end of this financial year.

“We are about to get an NBFC (non-banking financial company) licence and will enter the lending space, specifically aiming to lend to retail individuals. A lot of our clients hold stocks with us so if they want to raise some money on that stock, we would be the easiest people to do that,” said Kamath. Zerodha says it received interest from venture capital investors almost ever since it launched.

“If we ever needed to raise money, it would probably be for advertising, but that isn’t necessary. For instance, if we have 1,00,000-1,50,000 clients with a good review about us, it’s easier to get more (publicity) through word-ofmouth,” Kamath said.

CONTENDERS FOR THE BOOTSTRAP CHAMP AWARD


Inquirly Technologies | Anjan Choudhary

The company offers not just technology for digital marketing and customer engagement but also services to help businesses understand customer sentiment. The Inquirly stack comprises customer engagement through text messaging, email, social media and digital marketing.


InfoSoft Global | Pallav Nadhani

InfoSoft Global began as an enterprising 16-year-old’s idea to make some money. It now counts Google, Apple and Facebook among clients. The company’s flagship product, FusionCharts, is the industry leader in enterprise-grade charting components for web and mobile apps.


Indusface | Ashish Tandon

The company has developed an integrated solution to detect, protect and monitor web and mobile apps against cyber attackers. Indusface has more than 800 clients in 17 countries. Indusface was Nasscom’s ‘Top Emerging Information Security Product Company’ in 2015.


Wingify Software | Paras Chopra

The website optimisation company is among few product startups to have bootstrapped their way to success. It makes technology products to determine and analyse website traffic, helping businesses make informed decisions. Wingify’s products are used by more than 4,000 brands in at least 80 countries.