...It was then that they decided that Nikhil—who turned out to have a real penchant for trading—would continue to trade, while Nithin would build a brokerage firm. That was how Zerodha came into being, going live in August 2010. The name was a play on zero and the Sanskrit word ‘rodha’, meaning barrier. The brothers wanted to position themselves as facilitators of zero-barrier trading for their clients.
“There was an active futures and options trading community and we started out charging `20 per trade irrespective of the size of the trade,” says Nithin. Those in the business immediately recognised the value of this proposition; otherwise they would be paying a percentage of the value of the trade as fees in the conventional broking system. They would easily save 90-95 percent of that by switching.
The brothers also paid attention to earning trust, because a client still had to transfer money to the broker to put in a trade. “We were the first to come up with a utility that showed all costs upfront, before a single trade was initiated by any client,” Nithin recalls. In 2011, they upgraded technology to allow clients to trade outside the NSE as well.
By 2013, competition had started using the discount broking model, too, and it was clear to the brothers that the future was about becoming a technology company that offered a superior platform for multiple financial services. Zerodha invested in a startup called Tradelab, which built a desktop trading platform that became popular among clients.
Read more at http://www.forbesindia.com/article/tycoons-of-tomorrow/nithin-and-nikhil-kamath-code-zero/51347/1
“There was an active futures and options trading community and we started out charging `20 per trade irrespective of the size of the trade,” says Nithin. Those in the business immediately recognised the value of this proposition; otherwise they would be paying a percentage of the value of the trade as fees in the conventional broking system. They would easily save 90-95 percent of that by switching.
The brothers also paid attention to earning trust, because a client still had to transfer money to the broker to put in a trade. “We were the first to come up with a utility that showed all costs upfront, before a single trade was initiated by any client,” Nithin recalls. In 2011, they upgraded technology to allow clients to trade outside the NSE as well.
By 2013, competition had started using the discount broking model, too, and it was clear to the brothers that the future was about becoming a technology company that offered a superior platform for multiple financial services. Zerodha invested in a startup called Tradelab, which built a desktop trading platform that became popular among clients.
Read more at http://www.forbesindia.com/article/tycoons-of-tomorrow/nithin-and-nikhil-kamath-code-zero/51347/1
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