Zerodha diversifying through startup partnerships: Nithin Kamath
In addition to its commercial ventures, Zerodha has also committed resources to social impact initiatives through it Rainmatter Foundation.
Stock brokerage firm Zerodha is diversifying its offerings by partnering with startups across various financial sectors.
Nithin Kamath, Zerodha’s founder, explained the company's approach: “We’ve taken the route of partnering startups where we don’t want to be 100% of something, we are okay with being 60% of something.”
His comment was made at a fireside chat with Shradha Sharma, Founder & CEO, YourStory, at the 15th edition of TechSparks,
According to Kamath, Zerodha's strategy allows it to support entrepreneurs while giving them the freedom to drive their ventures.
Zerodha’s diversification includes building businesses like Zerodha Capital, which focuses on loans against securities, and an insurance business with Ditto, a growing insurtech company. Zerodha is also working on an asset management company (AMC) with smallcase, a platform known for thematic investing.
On startups, Kamath emphasised the importance of maintaining the entrepreneurial energy of the founders: “Anything to start, you need that entrepreneur energy... and that’s very tough to hire and find.”
In addition to its commercial ventures, Zerodha has also committed resources to social impact initiatives. Its Rainmatter Foundation focuses on environmental and climate action, as well as livelihoods associated with these issues.
Stock brokerage platform Zerodha's revenue reached the $1 billion mark in FY24 with a profit margin of over 56%, making it India's most profitable new-age tech company.
Zerodha posted a revenue of Rs 8,320 crore and a profit of Rs 4,700 crore, excluding an unrealised gain of Rs 1,000 crore.
Despite this strong performance, Kamath projects a decline in both revenue and profit for the current fiscal year. This expected downturn stems from recent regulatory changes, particularly a SEBI circular issued in July mandating uniform fees for all members of market infrastructure institutions starting October 1.
The company faces additional challenges, including increased competition in a market nearing saturation.
Edited by Affirunisa Kankudti