Zerodha is India’s largest stockbroker with over 2.7 million accounts. It remains bootstrapped bootstrapped Zerodha’s boundaries One of the most promising equity trading startups has grown from one strength to another. But it did not anticipate the challenge that is staring it in the face now Read more , and there isn’t a venture capitalist who doesn’t wish they had it in their portfolio. But about six or seven years ago, investors weren’t keen on it.

Stock broking hasn’t been a reliable investment option for VCs. The market fluctuates, and there just aren’t enough people trading in India. But the post-pandemic work-from-home gang has ensured an uptick in trading. And guess who’s the No. 1 recipient of VC love for stockbrokers?

Zerodha’s Zerodha’s The Ken For Zerodha, Covid is a ladder Read more contemporary, now the No.2 stockbroker in India, Upstox. Data from startup data provider Tracxn shows that $29 million of the $81 million investment that went into stock broking in the last three years, went to Upstox alone. And a large part of Upstox’s capital mostly came from one blue-blooded venture capitalist—Tiger Global.

There are upsides

In November, Upstox more than doubled its registered users to 1.5 million accounts, from a year ago. This put it ahead of traditional leader, ICICI securities, with 1.2 million accounts.

Upstox’s milestone comes at a time when the stock market is at an all-time high. With participation from new investors breaching new records. Internationally, this sort of new investor interest has meant the meteoric rise of a player like Robinhood, which allows young people to trade in a user-friendly way. The American retail trading app, which first introduced zero commission trading, now has over 13 million users and is valued at over $11 billion.

Upstox is seeing a similar crowd getting attracted to it. Tiger’s investment has given Upstox wings. The millions it raised has allowed Upstox to deploy growth hacks from referral bonuses to giving free stocks to users to get them to trade, bringing a younger demographic in.

We are adding 200,000-300,000 new accounts in a month, now. We saw almost 2x-3x year on year growth on all our key metrics from user to revenue, this year,” said Ravi Kumar, the co-founder of Upstox. “The average age of our customers is 31, and 65% of them are first time investors. And 70% of our user base is from tier two cities.”

Kumar believes this trend is here to stay among the millennial investors, who now want to be in charge of their own money.

AUTHOR

Arundhati Ramanathan

Arundhati is interested in how people use money in the digital age and how new economies will take shape based on that interaction. She writes the newsletter Ka-Ching! ever Monday. She lives in Bengaluru and has spent over 12 years reporting and writing on various subjects.

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