“We fought hard to ensure that we don’t enable greed with Zerodha” says co-founder and CEO Nithin Kamath
The fireside chat, moderated by Prof. Venkatesh Panchapagesan, was hosted by CCMRM and student-run finance club Networth
25 February, 2025, Bengaluru: It took 15 years for Nithin Kamath, co-founder and CEO of Zerodha & Rainmatter, to get “lucky”. At an exclusive fireside chat on 25 February 2025 hosted by the Centre for Capital Markets and Risk Assessment (CCMRM) and Networth, the student-run finance club at IIM Bangalore, Nithin offered an unfiltered account of his company’s rise, its ethos, and the tectonic shifts reshaping India’s financial markets. The conversation with Prof. Venkatesh Panchapagesan, Finance and Accounting area spanned Zerodha’s 15-year journey as a bootstrapped outlier, its philosophy of customer-first investing, and exercising restraint and regulatory foresight in a sector that is notorious for blitzscaling.
Nithin spoke of how Zerodha’s rise is, in many ways, counterintuitive. “We’ve got a better product than our competitors. It not only enables access to us, but to an ecosystem of products”. Speaking of the company’s philosophy, and its countercultural approach that actively dissuades users from overtrading, he said, “Our leverage is that because we haven’t spent any money at acquiring a user, and it is customers who get there through word-of-mouth, even incurring a fee to open a broking account, we don’t ever have to get into the business of nudging a user into taking a trade”.
On regulation as a moat, he said, “Regulations can be tough on businesses, but at least there is no ambiguity”. Over time, Nithin has come to see SEBI’s tightening of market rules as a competitive advantage. “The fear of regulation keeps 90% of the competition at bay”. While most fintech founders see regulatory oversight as a necessary evil, to him the criticality of compliance is an asset, and having regulatory oversight, he believes, was pivotal in Zerodha’s ability to navigate India’s financial landscape over the years.
Prof. Venkatesh provided an overview of how the company’s trajectory stands in stark contrast to its venture-backed peers. It never raised external capital; a decision Kamath attributes to its long-term sustainability.
“I don’t think it’s possible to build another Zerodha today because we didn’t have the distraction of raising funds as quickly as possible”. He followed up saying, “We focused hard on building a good product; luck and serendipity happened along the way”, recounting visiting the homes of their first 1,000 customers under the alias “Sachin,” personally collecting application forms.
On Prof. Venkatesh’s question of core competencies that the company has prioritized, Nithin credited its people. “Another reason for our success is the fact that a core 100-150 members of our team have been with us right from the start. As money compounds over time, so do people’s capabilities. Our members have grown with us, and we’ve managed to retain them”, he explained.
Beyond brokerage, Zerodha has made significant bets in venture philanthropy through Rainmatter- its foundation and investment arm. Unlike traditional venture capital, Nithin’s approach does not fixate on hypergrowth. Instead, Rainmatter prioritizes profitability over scale, a phenomenon highly uncommon among VCs, he admitted.
“We don’t care about how many users you’ve added or how fast you’re growing. We’re asking: Are you profitable or not?” he said. In his view, companies cannot create lasting impact if they are not financially viable. “We’re ready to be patient with you. We’re not chasing a short-term funding lifecycle,” he explained.
Their investments span four key sectors: climate change, health tech, fintech, and storytelling.
To Prof. Venkatesh’s next question of what keeps him up at night in this business, “Majority of our business is leveraged, and with how global macro has been playing out, it’s all about how the world is going to unexpectedly affect the market. SEBI’s regulations do help. But there have also been instances where we’ve tapped into our doomsday kitty”, he quipped, recalling a time commodity prices, specifically crude oil, went into negatives.
Nithin also cautioned young traders seated in the audience, “People trade too much money. Find the right trading size for yourself. Trade with as little as possible. Invest with as much as you want; diversify your portfolio across sectors”. He further added to the brokerage giant’s aversion to industry trends like gamification, saying, “We fought hard to ensure that we don’t enable greed with Zerodha”, which he argued fuels risky behavior.
To watch the complete livestream of the fireside chat, click HERE.
“We fought hard to ensure that we don’t enable greed with Zerodha” says co-founder and CEO Nithin Kamath
The fireside chat, moderated by Prof. Venkatesh Panchapagesan, was hosted by CCMRM and student-run finance club Networth
25 February, 2025, Bengaluru: It took 15 years for Nithin Kamath, co-founder and CEO of Zerodha & Rainmatter, to get “lucky”. At an exclusive fireside chat on 25 February 2025 hosted by the Centre for Capital Markets and Risk Assessment (CCMRM) and Networth, the student-run finance club at IIM Bangalore, Nithin offered an unfiltered account of his company’s rise, its ethos, and the tectonic shifts reshaping India’s financial markets. The conversation with Prof. Venkatesh Panchapagesan, Finance and Accounting area spanned Zerodha’s 15-year journey as a bootstrapped outlier, its philosophy of customer-first investing, and exercising restraint and regulatory foresight in a sector that is notorious for blitzscaling.
Nithin spoke of how Zerodha’s rise is, in many ways, counterintuitive. “We’ve got a better product than our competitors. It not only enables access to us, but to an ecosystem of products”. Speaking of the company’s philosophy, and its countercultural approach that actively dissuades users from overtrading, he said, “Our leverage is that because we haven’t spent any money at acquiring a user, and it is customers who get there through word-of-mouth, even incurring a fee to open a broking account, we don’t ever have to get into the business of nudging a user into taking a trade”.
On regulation as a moat, he said, “Regulations can be tough on businesses, but at least there is no ambiguity”. Over time, Nithin has come to see SEBI’s tightening of market rules as a competitive advantage. “The fear of regulation keeps 90% of the competition at bay”. While most fintech founders see regulatory oversight as a necessary evil, to him the criticality of compliance is an asset, and having regulatory oversight, he believes, was pivotal in Zerodha’s ability to navigate India’s financial landscape over the years.
Prof. Venkatesh provided an overview of how the company’s trajectory stands in stark contrast to its venture-backed peers. It never raised external capital; a decision Kamath attributes to its long-term sustainability.
“I don’t think it’s possible to build another Zerodha today because we didn’t have the distraction of raising funds as quickly as possible”. He followed up saying, “We focused hard on building a good product; luck and serendipity happened along the way”, recounting visiting the homes of their first 1,000 customers under the alias “Sachin,” personally collecting application forms.
On Prof. Venkatesh’s question of core competencies that the company has prioritized, Nithin credited its people. “Another reason for our success is the fact that a core 100-150 members of our team have been with us right from the start. As money compounds over time, so do people’s capabilities. Our members have grown with us, and we’ve managed to retain them”, he explained.
Beyond brokerage, Zerodha has made significant bets in venture philanthropy through Rainmatter- its foundation and investment arm. Unlike traditional venture capital, Nithin’s approach does not fixate on hypergrowth. Instead, Rainmatter prioritizes profitability over scale, a phenomenon highly uncommon among VCs, he admitted.
“We don’t care about how many users you’ve added or how fast you’re growing. We’re asking: Are you profitable or not?” he said. In his view, companies cannot create lasting impact if they are not financially viable. “We’re ready to be patient with you. We’re not chasing a short-term funding lifecycle,” he explained.
Their investments span four key sectors: climate change, health tech, fintech, and storytelling.
To Prof. Venkatesh’s next question of what keeps him up at night in this business, “Majority of our business is leveraged, and with how global macro has been playing out, it’s all about how the world is going to unexpectedly affect the market. SEBI’s regulations do help. But there have also been instances where we’ve tapped into our doomsday kitty”, he quipped, recalling a time commodity prices, specifically crude oil, went into negatives.
Nithin also cautioned young traders seated in the audience, “People trade too much money. Find the right trading size for yourself. Trade with as little as possible. Invest with as much as you want; diversify your portfolio across sectors”. He further added to the brokerage giant’s aversion to industry trends like gamification, saying, “We fought hard to ensure that we don’t enable greed with Zerodha”, which he argued fuels risky behavior.
To watch the complete livestream of the fireside chat, click HERE.