Here we chronicle one more player, Zerodha: an online discount broking firm, which aims to give lower costs to the clients, something that can be crucial in deciding the long term profitability of a person trading in the capital markets.
Nithin has been trading from the age of 17. He did attend an engineering college, like thousands of Indians do, and then did something not all these engineers do: became an entrepreneur! During college he used to spend more time on trading, and even went bust once, during the 2001 downturn. This forced him to take up work at a call-center. He worked at the call center during night and thus saved the day time for trading. I did this, working-trading, for almost 3 years during 2004-5, post which, I quit my job when I got my first client who asked me to manage money for him after looking at the positive returns on my trading account,” says a proud Nithin.
Soon he got more through referrals and also became a sub-broker when Reliance Money was launched. At Reliance Money, he was one of the most successful sub-brokers, sometimes giving volumes that were more than all the other 1000 odd sub-brokers. “But as a trader I was still finding something missing with the way RMoney was working, not really what a trader requires. That is when we decided to start Zerodha,” adds Nithin.
The core team of Zerodha comprises people who were with Nithin from his RMoney days. Nikhil his younger brother and a brilliant trader, manages the prop trading desk, risk management and everything related to trading. Venu and Hanan manage the compliance & back-office and customer service issues respectively. Today Zerodha has a team of over 60 people.
Although Zerodha has adopted a successful model; 80% of the business in the US happens through discount brokers, it has experienced its share of challenges, “The biggest challenge for us is credibility, because we charge so less, people assume that there is a catch or the service is bad,” says Nithin.
Catch all the action happening in the Indian mobile world at MobiSparks 2012!