nithin kamath: Zerodha crosses 1 crore customer base mark, Aadhaar biggest tipping point: Nithin Kamath

“Looking back, the biggest tipping point was Aadhaar for online account opening. Can’t thank the government & Sebi & exchanges & depositories enough for making this happen,” Kamath said.

Started 12 years ago by Nithin Kamath with trader and brother Nikhil Kamath, the Bengaluru-based firm disrupted the broking industry in India, turning the siblings into billionaires.

“The plan to rely on word-of-mouth & have a single offering for all customers had benefits that we never thought of at the start. Economies of scale kicked in not just in tech but across support & ops—the team size has remained the same as we went from 20lk to 1cr clients,” Kamath said on Twitter.

He said when customers are introduced by family or friends who are existing clients, they also tend to help bridge the knowledge gap about the platform at the start. “A huge challenge for consumer apps in a complex business like ours,” he said, adding that they started by charging account opening fees to cover costs.

“We soon realised that the fee also created a sense of seriousness; trading is risky & isn’t like installing a gaming app. Also, only those with intent open accounts, reducing compliance costs of inactive accounts,” Kamath said.

Zerodha’s business model has been unique in the sense that they have a lean team and do not spend money on marketing or advertising even as the competition is increasing in the discount brokerage industry.

“Don’t do unto others what you don’t want to be done unto you, has been at the core of everything we do. This meant no spam calls, emails or push notifications to open accounts or trigger trades. This also helped us gain credibility, the biggest challenge in broking business,” he added.