Nithin Kamath, Founder and Chief Executive Officer of online stock trading platform Zerodha, announced on August 26 that the company has amassed a customer base of over one crore.
He wrote on Twitter: “We, at Zerodha, just got to 1 crore customers” and added: “looking back, the biggest tipping point was AADHAR for online account opening. Cannot thank the Government of India, the SEBI, and the exchanges and depositories enough for making this happen”.
Kamath also pointed out that as economies of scale kicked in not just in tech but across support and operations, the team size remained the same even though Zerodha went from 20 lakh to one crore clients.
He then went on to explain how some things they did gave them “unintended benefits” and helped the company grow over the past 12 years. Kamath said: “The plan to rely on word-of-mouth and have a single offering for all customers had benefits that we never thought of at the start.”
He added: “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. Can't thank our customers enough for this.”
Kamath said that the idea to charge customers for opening an account also helped the company prosper. He explained: “We started by charging account opening fees to cover costs. We soon realised that the fee also created a sense of seriousness; trading is risky and isn't like installing a gaming app. Also, only those with intent open accounts, reducing compliance costs of inactive accounts.
Avoiding spam calls, emails, and push notifications helped the platform gain credibility, said the Zerodha founder. He said: “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 the broking business.”
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