Can’t live without it. Can’t live with it.
Can’t have too little. Can’t have too much.
The means to all ends. The ends to all means.
But if you think your relationship with money is complicated, spare a thought for Nithin Kamath of Zerodha Zerodha The Ken For Zerodha, Covid is a ladder Read more . Kamath, 40, and his brother Nikhil, 34, were both recent entrants in Forbes’ “India’s 100 Richest People” list list Forbes India's 100 Richest People Read more . They also topped Hurun India’s “40 and under self-made rich list 2020”, with an estimated fortune of Rs 24,000 crore ($3.3 billion). To top it all, his startup Zerodha is quite literally in the business of money. It’s India’s largest stockbroking firm in terms of both volume and customers.
Kamath sat down with The Ken to share his startup story, world views, life lessons, and how the business of money is at the centre of it all.
Q. Outside the investing community, most people don’t know much about Zerodha. How would you characterise what you do?
At its broadest level, Zerodha is a platform that lets you save or invest money in the most efficient way possible. We provide education, access to all instruments, and access to a bunch of platforms that can help a person decide what’s the best place to invest. Specifically, Zerodha is a stockbrokerage firm, but unlike traditional stockbrokers who provide advisory services, we stay away from investing tips and the like. Our focus as a discount brokerage is to function as a platform that empowers users to take informed financial decisions, rather than provide that advice ourselves. So, apart from advisory, we essentially do everything else that a typical stockbroker does.
Q. For people who don’t know stock markets, what exactly is a discount brokerage? How is Zerodha different from other stockbroking firms?
The brokerage industry is probably one of the oldest industries in India; and the Bombay Stock Exchange (BSE) is the oldest and one of the largest stock exchanges in Asia. Historically, BSE has been an association formed of stockbrokers. When we started Zerodha 10 years ago, there were 400-500 retail brokers in the country. Out of these, the top 20 were like 80% of the market. A lot of the remaining 380 people were these guys sitting on the street or in small offices in Mumbai, with small clients.
The large ones were the likes of ICICI, HDFC, Sharekhan and Reliance. All these firms operated with a pricing model that charged a set percentage fee based on the value of the stock transaction.