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Nithin Kamath of Zerodha

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Trading at Scale – 12 Years of Trading, Bootstrapping and the Poker Hand

Bootstrapping, scaling Zerodha, working with Family and Being Honest with Capital – turning down capital. Nithin Kamath of Zerodha shares it all on this very first episode of Maharajas of Scale.

Zerodha today has millions of users from its humble beginnings over a decade ago. Listen to Nithin of Zerodha talk about trading at scale.

P.S: There is stuff you’ve never heard before.

Krishna Jonnakadla and Nithin Kamath of Zerodha talking

In conversation with Krishna and Nithin

Nithin’s Bootstrapping Journey

00:01:05  Nithin Kamath talks about his bootstrapping journey. How the various jobs he held before launching Zerodha gave him deep insights into trader behaviour and expectations, which helped him build a brokerage that traders needed.

00:02:58  How the need for a low cost FNO trading platform provided Nithin an opportunity for his company.

00:04:43  The choice to start his company in Bangalore instead of Mumbai posed some challenges. But Nithin explains how Zerodha ended up being all the better for it.

00:07:43  Nithin talks about how raising money for a startup was hard in 2010, but fortunately, Zerodha got access to free technology which helped them survive and grow.

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No Competitors for Zerodha Currently

00:14:32  Currently Zerodha doesn’t face many new competitors, but Nithin wants the market to grow and new companies to come in. We talk about the challenges of fostering an investment mindset in India..

00:24:38  Nithin’s brother joined him as a trader at the age of sixteen. He explains how they divided up their specialties and how Nikhil keeps him grounded.

00:29:55  Zerodha’s work culture prizes attitude over ability. Nithin explains how important it is to find people who fit into the company, and how founders like him should always be flexible and open-minded.

00:34:12  Zerodha’s products are extremely user-friendly in a market where quality is rarely high. Nithin tells us how he beta-tests all his products himself.

Zerodha’s User Base

00:40:06  We talk about how Zerodha’s userbase has changed from its initial days. It started as an FNO brokerage firm, but now their users are mostly first time investors. Adhaar simplified KYC and made user acquisition much simpler. We discuss why its worth saving the card.

00:45:08  Nithin rues that Indians don’t have a good education on handling their money. His initiative, Varsity, tries to promote investment knowledge in the younger generations.

00:48:30  The difficulty of recruiting employees for startup when fresh graduates look to MNCs for stability. Nithin gives advice to young men and women starting out in this field.

00:51:29  Nithin had faced many financial disappointments before Zerodha. He talks about how he shrugged off the failures and soldiered on. And, how he runs Zerodha aggressively as well as conservatively.

00:55:41  Innovation needs regulation. Nithin explains that his litmus test for whether a product will survive is the reaction of the regulatory bodies.

Zerodha’s Strategy

00:57:23  At a time when large corporations are closing up their database to startups, Zerodha invites smaller companies to come and leverage on their userbase. Nithin talks about the benefits of this strategy for their users and how keeping out third party investors helped let them make these decisions.

01:00:48  We talk a little about what the real Nithin Kamath is like when he’s not working.

01:03:19  What’s next for Nithin and Zerodha? Nithin believes that India relies far too much on foreign money and Indians invest too much in gold and real estate. He looks forward to a time when India invests in its own growth and he wants to be enabling that future.

Zerodha is slowly and surely changing the way young Indians Invest. With products such as Coin, Kite, Small Case, Zerodha Varsity and their rain matters initiative about bringing interesting products that would make their users invest better. Zerodha is redefining its space. This is their story with lots of interesting things that Nithin has never said before in a public forum.

Teaching investing to kids - an initiative of Zerodha


Teaching investing to kids - An initiative of Zerodha

Check out how Ashish Singhal built CoinSwitch to a Unicorn: Season 1, Episode 38

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​Episode Transcript​

(Automated Transcript)

SUMMARY KEYWORDS

people, business, trading, products, money, india, traders, investing, called, years, bootstrapping, users, stock, big, platform, kite, broker, problem, company, market

SPEAKERS

Krishna Jonnakadla, Nithin, Nida Sahar

Krishna Jonnakadla  00:01

This is Maharajas of Scale , a podcast where we go behind the scenes and talk to founders who are demolishing the myths around building and scaling a big business in India. These are the stories that have shattered the assumptions around Indian consumers and are changing the game completely. I am Krishna Jonnakadla, serial entrepreneur, Co-founder of FLIT - The Fashion Locator in Town and Startup Mentor, bringing you these stories. Hey, everyone, this is Krishna Jonnakadla from Maharajas of scale. Today we have a very exciting, dynamic young entrepreneur. We are with Nithin Kamath of Zerodha who's perhaps built India's most successful FinTech startup, we will talk to Nithin today about his entrepreneurial journey, and also go into a little detail about the market. And though what he sees happening in the investing and the financial services space. Nithin, welcome to the podcast.

Nithin Kamath  01:02

Thanks for having me on the show. Thank you.

Krishna Jonnakadla  01:05

So Nithin, your story makes for some fabulous listening. I've heard it a few times myself. I know you have said this in a couple of different ways about bootstrapping, how it worked for you, why it worked for you. Take a few moments, talk to us about your bootstrapping journey. And maybe how did you end at that point? And what were some of the things that you would attribute, let's say to the experience that you had, until then, and how that worked in your favor later on.

Nithin Kamath 01:35

Yeah, I mean, I started trading when I was really young. So Zerodha started in 2010. I started trading in 1997. So at almost 12-13 years of experience before, you know, the business actually started. So during that period, I went to an engineering college, I did three, four years of call center job, I was sub broker, I was managing portfolios. I was running an advisory company, I was probably running the biggest community kind of initiatives around traders and investors in the country. So yeah, so all of that happened. And eventually it culminated into starting Zerodha, which was essentially to solve the problem that I was facing as a trader, and my younger brother had joined me by then and he was a better trader. So I said, let me stop trading, and maybe try to give it a shot, to build a broker that we didn't have as traders, or the community that, you know, I was interacting with didn't have as traders. Yeah. So that's, you know, that's how it all started.

Krishna Jonnakadla  02:37

Pay close attention to what Nithin just said. By the time Nithin started Zerodha, he had built perhaps the largest investing and trading communities in India. And what this did, was gave him a first hand insight into their behaviors into some of their needs and their expectations. It is this that he leveraged when he started Zerodha. You said this, that we didn't have a broker, the way trading was done at that point in time was you either start up with some large broker, you go stay there, and I've done that myself, where you stayed at a terminal from morning till evening, or you have a designated person, talk to them, ask them for stock tips. So what exactly was the need that you thought you were going to fill in the market at that point in time?

Nithin Kamath 03:22

By 2006-07, you had ICICI Direct, you had IndiaBulls, you had ShareKhan, you had 5Paisa. So there were a lot of online only platforms. So people had started that, that shifted happened from sitting in an office versus sitting in their house or sit in the office and their own offices and trading. And that shifted happened. And I think internet was kind of blowing out in that period as well. So more and more people wanted to kind of trade on their own. But what we were trying to solve for at that point was different. I was a very active futures and options trader. And so the community that I was catering to, and in futures and options trading, you know, the cost of a trade actually makes a big difference to how profitable you are or not. Right, So what we are trying to solve for when we started the business, which is reducing the cost. A lot of these brokers were having these fancy offices in Bombay, a lot of relationship managers, a lot of research, but active FnO traders didn't want any of it. They just wanted a decent trading platform on which they can trade at low cost, right. And that was essentially the problem that we're trying to solve for when you start a business.

Krishna Jonnakadla  04:26

Almost all great scale stories have very simple and humble beginnings, perhaps subconsciously. And perhaps by choice, they do not solve several problems at once they solve a single problem, which is what Nithin did with Zerodha. Common wisdom sort of dictates that if you have to build a business around anything, you have to be where the action is, right? FnO trading outside of Mumbai is virtually possibly a sport. But outside of it there is a way of living, building an FnO business away from Bombay, and Mumbai, especially so far away. How was it? Was it daunting? Do you think the distance actually gave you a certain amount of objectivity?

Nithin Kamath 05:11

See for an online business, it doesn't really matter where you're present at. Now one of the problems that has happened to brokerages and Indians, some the regional players has been there, they've been kind of white labeled as, you are a Kerala based guy, you're, Calcutta based guy and things like that. Right. So we were trying to, even though we were Bangalore, we were trying to, find ways to not be looked up upon as a South Indian broker or a Bangalore based broker. So even though we're online as a business, you know, eventually now today, we have offices in 30-40 cities. So just to make sure people look up to us, and not as a Bangalore based broker, but as a national broker. But you're right, as in when we started the business, people did ask this question saying, how can you do this in Bangalore, in hindsight today, people call it passion, but we did a lot of foolishness back then. And choosing Bangalore may be at that point of time was foolish, because, you know, getting access to the right kind of people who understand features and options is a lot more tougher in Bangalore than in Bombay. So looking back, I think it's helped us a lot. And the kind of team we've been able to set for which has been the reason for the success of this business couldn't have been set up in Bombay.

Krishna Jonnakadla  06:18

Very interesting, we should say that you were able to find talent to do this kind of routine away from Bombay was actually a blessing. Let's go back to the bootstrapping journey a little bit, there are certain startups that can work in a bootstrap mode. And there is also sort of widely received wisdom. While later on, they may all have raised funding, in their formative years, while they understood the market most or rather, most big businesses or big startups have all been bootstrapped. Because what that means is like what Paul Graham tries to say, two things that don't scale, you're doing things that give you a sort of an understanding of the market. And that can only come from being bootstrap. And one of my favorite lines is from an entrepreneur called Vaitheeswaran, who has coined this phrase called being brupid, which means you have to be both- brave and stupid at the same time to be able to do something of that sort. And when you were reckoning your thoughts about being in that boat, while you started in Bangalore, but you've done more things as well, right, while the 12 years of being in the trade. Twelve years for being in the trading business certainly gave you a certain understanding, there was by no means assured business and immediate book of business. And there are things that you've done as a single entrepreneur, that lot of people do underestimate today, it's sort of folklore. So talk to us about some of those formative times.

Nithin Kamath 07:47

So when we started the business, I did go and meet VCs and etc. So, see, 2010 was probably the worst year to start a broking firm. Because after 2008 collapse, the markets had gone into like a big time downturn, right, as an activity in the market has dropped, there was no trading volumes. So starting back, then again, was one of those foolishness of sorts. But then the added advantage there was most of our competition was going out, we were getting in. So we kind of got a three four year, like a period where we could do a lot without competitors actually doing anything back to us. But yeah about this bootstrapping thing. So yeah, so I did go meet people. And it was, it was not the right time to go raise money for a brokerage firm. Right. And also, I didn't come with any pedigree, education, background, or I didn't really have. I mean, my presentation was like shit. And also, as I was just looking at it at the other day, and I was like, you know, because today I look at a lot of the startups now and their presentation, and I was probably 1% of how professional guys are today. So to be very honest, if I was a VC, I will not have funded myself. It was how bad the presentation was. But then I think at that point, it was one of those gut feeling that kind of knew that there is a, this is like an opportune moment. The reason for that was NSE, the National Stock Exchange had launched an in house platform called NSE now, right, so the exchange started giving out free trading platform for people who became brokers of the exchange. Now, this platform wasn't fancy, you know, it is it's just a really basic platform. But it does a job. Just now if you want to buy you want to sell you can do it quickly. And, and it's quite stable. And I think I was probably one of the first few to support this platform, which was kind of being given out for free. So if you got membership on the exchange, you got technology for free, right? So it was kind of a technology arbitrage of sorts, which got us to kind of actually get this started. So other than the trading platform and this broking business, you need something called as a back office platform. So which essentially calculates all the P and L for the day, makes credits, debits, makes out a contract node, sends it out to the customers. Now, I was beta testing this for a Chennai based small software company. So we got it for free, so you know that person said, if you test out this product for me, I'll give you first year for free. So we actually started this business today, we're known as a technology business. But we started this business with zero rupees on technology. I think we spend like 16,000 rupees on our website, right. That was really the only technology that went into the business when we started off.

Krishna Jonnakadla  10:41

A businessman I greatly admire who took his small retirement earnings when Enron shut down in the US and bought a park share in a subway restaurant, and eventually turned it around and bought 10s of subway restaurants in the US, once told me that an entrepreneur's ability in creating value lies in his ability to read the market and its circumstances, right. And also about creating 10 x value from the situation that he sees it had. And when you listen to Nithin's bootstrapping story, and how 2010 was perhaps the worst time to build the business. And in some sense, it was also the right time for Zerodha itself, because there was going to be uncontested market for the next several years. And added to that, there was the technology that NSE provided almost for free. And a back office system, which they source from Chennai, for the first year for free, virtually gave them a free rein for the first couple of years with the right tool set and the right circumstances. And it is this uncanny ability and an Act to read the market that gives birth to great enterprises and great entrepreneurs.

Nithin Kamath  11:53

So yeah, so I mean, today, a lot of people give credit for bootstrapping. And I'm usually asked this question, should I bootstrap? Should I be bootstrap? We should raise money. I mean, I got extremely lucky in life that,  we got there, we were at the right place, right time, you know, de-mon happened, Adhaar became popular, the markets did okay, so all of those things played along. So bootstrapping worked and otherwise. And also, you know, before we started the business, there was 12 years of hard work that had gone into business. It wasn't something that, you know, it wasn't a problem that I was trying to solve, which I thought open a coffee shop and, and make the next day, and I went ahead and started the business. And so, so there was this core competency. That was there for the business, one of the very famous VCs, you know, when I met him after, I think 2013 14, so he was kind of asking me, you know, for all those who play poker, was asking me Nithin, how does Zerodha feel like, you know, what kind of a hand this is. And I told him, ace queen suited. Ace queen suited is a decent hand in Poker, right, but then it's one of those hands, when you get it, you're supposed to bet money on it, and make sure your weaker hands now fold. So he was kind of giving me a logic on why I should be raising money at that point of time.

Krishna Jonnakadla  13:12

I'm always fascinated when an entrepreneur uses a poker analogy, to actually explain their strategy. Because poker as a game is very unlike what a lot of other games are made of poker is a game of chance, smarts, skill, psychology, and strategy put together, which is what most entrepreneurs need to bring to the table in order to win, not just at poker, but also in their business.

Nithin Kamath  13:41

But you know, my argument with him was that with this whole core competency of being in this industry for so many years, today, maybe I know the kind of hands my competitors have, right? So I don't really need to bet hard to make them fold. I kind of maybe have an inkling on. So yeah, so I think the starting the business without raising money wasn't really an option that I had. So I was forced to do it. But saying no to people over the last seven eight years, and the valuation says, just an omen. It's just gone every time you say no, no, it's like this. This girl in college, we never dated anyone, right? The more you saying no, more attractive you beccome. So that's what's happened to the business today, like everyone wants, you know, that you invest, because I keep going around and saying, No, no, we don't need the money. You know,

Krishna Jonnakadla  14:30

It's very interesting. So let's talk about competition a bit. It's one thing, to obliterate competition, or to them, but totally to be in a league of Europe. I think you are there. Because I've lived in the US for a long time. If I, if you see what E trade or Scottrade or Charles Schwab, any of them have done, even compared to the likes of those what you've done with your products, like Kite or Coin is very, very refreshing. Right? So I believe the hand that you talk about, has definitely given you that decisive advantage. But if we were to take Peter Thiel, forget competition, and put yourself completely out there. What does that look like? Let's forget about raising money to obliterate competition. If we were to start fishing in new parts, newer markets, what does that mean to you? And the company?

Nithin Kamath  15:21

Yeah, I mean, today when I meet investors, and they say, take some money, like my usual reply to them is, I don't know what I do with the money, right? Because I don't really see raising money is going to help us in solving what kind of a problem. So one thing we've decided is that we're going to kind of be in spaces where there is our core competency, right? So I don't want to get away doing something that I don't understand, just because it seems like an opportunity, right? So we are very clear and focusing, it's going to be around investing, saving, and just the ecosystem around it, right. And even today, we're under this incubator called RainMatters, every time we invest. I mean, there are a lot of, really good proposals that come by, which are kind of outside the capital market ecosystem, we kind of very clearly say no to it, not because it's a bad, you know, bad pitch, but it's because it's kind of outside our core competency. Now, the other thing about this industry regulated kind of businesses that there's a lot of red tape, but once you're on the other side, that itself becomes as a kind of a roadblock for the rest, that I think we've kind of enjoyed that right as in, because like today, if you want to take a membership on the exchange, get all kind of approvals, have your stack ready, you know, have a trading platform ready, is at least two years, right? This isn't like a business, you know, where you can, you can think of an idea and quickly, quick turnaround, you can have something up. Right. So, I think we've been lucky that way that you know, because it's so much more tougher, so newer age companies, who don't mind putting money, but they don't really have time to spend or it doesn't. So, you know, they don't even look at coming in really competing in the space. So we've gotten lucky and the incumbents, they've diversified so much, that the space that we are kind of focusing on isn't really their core attention anymore. Right? The retail investor, the 20 to 40 year old isn't like, now I was just looking at the balance sheet of Eldeweiss 3% comes from broking, Motilal 70%, you know, I mean, so all of these guys, the exposure to retail broking as such as reduced significantly. And I think that, you know, it's also said, I think the incumbents are kind of working on stacks, which are 15-20 years old. And it's just another just too much resistance within the organization to update and etc. So I think on the product side, we will always continue to have an edge on that. But our real competition in all sense. You know, even though it's a small point, there are some bigger fishes trying to get into the sponsor, it's not like we are the only big fish in this, PayTM money is around the corner. There are two three, like players who've been trying to work on the product side who can potentially be competition to us. But outside, as I said, and I think the big problem to solve for the entire ecosystem is to grow the ecosystem itself. Like, I think 20 million unique Indians have any kind of mutual fund investment, there are probably 5 million Indians who invested once a year last year. So the Yeah, so the idea is to grow that and growing, that there is no one no competition to be it as no one is trying to really grow that in the right way. And the problem I have today is that throwing money is not going to grow it, because you advertise someone opens a trading and demat account, but he doesn't have an idea an inkling of what stocks are.  Certain!  Right, what does he do next right as it. Now I think in the US one of the reasons I think like Robin Hood has blown out is because there are companies whose products you consume that list on the US market say like in Robinhood I think half the avm of Robinhood right now is from the banks. So if Facebook,Apple.Amazon, Netflix, Google, right. So products that you consume, you aspire to own, people are going buying those stocks. In India, the problem is we don't really have one stock that I aspire to own today, or a product that I consume, which is actually trading on the Indian exchange, right? Maybe bullet is a brand that I know, they don't call it bullet they call it Eicher so most people who invest don't even know that bullet Enfield,  actually should ideally called it right. And I don't think that companies even looking at really, you know, increasing retail participation in the stock, there is no bonus nothing given out. So the stock price itself is so high that, you know, retail can't really participate into.

Krishna Jonnakadla  19:55

So that brings up an interesting point. In the US there are there are products called Big shares and on the back of the BitShares, there are gift cards. So for instance, you can actually send if you want to encourage your investing habit or a saving habit, but you can take a bit share, whereby let's say somebody gets 0.05% of an apple stock. Because you certainly put the fangs in the aspirational set of stocks. And if I have an apple iphone, and I'm so interested in the company, but then somebody actually gave me a gift. So now it is an ownership that encourages me. So that is one idea. The other one is, in the case of somebody like Eicher, which this share is trading at 20 plus thousand rupees. And, you know, that sort of looks so intimidating for retail investors saying that I'm just bidding one Share is 24,000 rupees. And there are other examples like that TTK prestige rate 8000 7000. So people look at it, I am of the believe that other people in the ecosystem can start nudging them to say take some decision, maybe split the stock, or maybe do something with it. For instance, Berkshire Hathaway, at one point in time created a class B. It was a shape socketer, it was so popular. And Buffett didn't want to die you and he created a class page said you don't have any ownership rights, but you still want to invest. And then that created a completely new class of wealthy investors and people got interested in Berkshire. I'm just seeing that you because you have such a mind. Do you think you could at least encourage those conversations, or maybe create these sort of products, whereby today if a college student who's going I haven't believed that, if you have to start out if you started really early in life investing and will do a good job of not getting carried away, you can come out well towards the mid life. If you have a midlife career crisis, you still have a good balance that you can drop ease from. So encouraging, these sort of behaviors that your mind you think are something that you might embark on.

Nithin Kamath  22:06

No, no, I mean, I've had this conversation with some of these companies whose share prices are quite big. I mean, they're not really looking at, you know, making it more attractive to the retail. And also, you know, that's not even their objective. So I don't think they're going to be in on it. Now, the fractional ownership of shares in India in its current form is not possible. Because in the US, and also when you hold a stock, it's like a ledger entry on a books and record system with a broker. In India, there's a concept to depository, right. So every customer has a beneficiary account with a depository where a share comes and sits. In the US, it's actually a ledger entry. So when it's a ledger entry, the broker can say, point one belongs to this, point two belongs to this. But in India, the broker is not in control of this at all. So once you buy the stock at Zerodha today it goes and sits in your CDSL account, and we have no control on that one sits in the CDSL account. So fractional ownership, unfortunately, is not possible. Now, the third piece is this whole gifting, you know, we've thought on this idea of preferred for quite a bit, saying that, maybe we should have a product where father can gift it to son on the 18th birthday, and all of that. Right. So the issue with gifting and I mean the issue with anything, any movement of money in India is that this whole money laundering is such a big problem for this country. And I think one of the reasons why the wallets went away, and all of that, right is because or crypto currencies are not allowed, is because people just misuse this facility of being able to gift, right, being able to send money from one account to other which is kind of tougher to account for. And this is one of that problem. So I could gift you share. Now when it comes to you, if it comes to you as a gift from a non related party, it becomes incomplete. Right. So in which case, you will have to now file taxes on that income. So yeah, there are just too many complexities, around that whole just gifting visa itself. But we've thought about all of this. Currently, we are working on allowing investing into the US markets for Indians,  which means that it will allow us to get people buy a percentage, a fraction of an apple share or fraction of a Amazon share. So hopefully in the next three or four months, that should be up. And we're hoping that we can probably introduce a new breed of kind of investors to start, you know, this whole investing activity, at least since.

Krishna Jonnakadla  24:38

So we go back to some of your initial days of it. And I do want to talk about you putting your younger brother in the venture, while common wisdom falls on either side, one set of people say, hey, you have a very strong family that's your first set of people. And there's also other wisdom that you know, family sometimes tends to make the worst of partners. And there's another wisdom that for every one startup killed by the fans of Facebook, apple, and there are 499 that just get killed because of that founder dynamics. Now working with your brother, and he also say that he was a much more superior trader. How was it sort of a no brainer decision? Or was it that he was a force in training, and therefore it just made sense? Or you go on to team.

Nithin Kamath 25:28

No, I Mean, so Nikhil is seven years younger to me, so and also, so he's always kind of ended up following whatever I did. So yeah, he also started when he was 16- 17 years old. So by then I was already like, 22.

Krishna Jonnakadla  25:45

You were a source of inspiration, I suppose.

Nithin Kamath 25:47

I mean, I don't know, inspiration, the thing I was trading is, you know, it gives you that financial independence. You don't have to do a nine to five job like everyone else. So that might have the inspiration to start. But then yes, over he started trading, he was a very skilled trader than I was. So there was no two ways about it. And it didn't make sense for me to sit and trade when I am. Because in trading, you know, instead of buying one share, I can change the number and make it two shares. And what's the point of two different people sitting in trading here, one is performing better. So I think in 2008, etc, it was on the wall saying he's a better trader, he should just do more of it. Now, when he started the business, I mean, the roles were very clear that I haven't placed a single trade from the time that businesses started. And so I mean, I test out a platform, you know, but I'm saying a trade where now the P&L matters to me, right, that kind of trade. I stopped trading as soon as a business started. And he doesn't interfere in the business. The sense he does it really involved in running the business. So it was very clear that we're going to do these two things

Krishna Jonnakadla  26:49

 You understood each other really well. It's your strengths.

Nithin Kamath  26:53

And yeah, absolutely. And I mean, I am I like to go please everyone, you know, I'm one of those kind of guys that and he's, you know, he likes to work solo. So trading, , is it, is the right kind of a thing for him, and, and he's kind of skilled in trading as well. So you know, he's done 55% compounded for the last five years.

Krishna Jonnakadla  27:13

Oh, my God. Right. That's insane. 55%.

Nithin Kamath  27:16

And so I mean, so this is our own money. So it's great only for prob, we've just launched a hedge fund, which is called true beacon. It's a kite 3 app, and so he's trying to go there, raise some money and kind of take that business of trading and making it bigger. So yes that's kind of been, you know, very complimentary. And I'm an eternal optimist and he's a very pessimist so he keeps grounding something. You know, every time I get excited, he kind of tells me to cool down. And I think amongst me, him and Kailash who has a tech has been one of the key, he joined late. So I keep telling him, you are co founder, he was like, I came in only after three or four years of the business. But he's as co founder to the business,as both of us, for the business we have today. Because until 2013-14, we were essentially working on vendor platforms, right? There was nothing in house which was tech. Right. So Kai came in join. And then we put out a first version of kite, which is a web and mobile platform in 2015. And it was completely his idea of, because I was one of those who wanted to offer everything on the trading platform. And he was like, you know, he said, No, it has to be minimal. It has to be clean, and all of that. Right. And the thing was, I think there were two different schools of thoughts. Until then, you know, we were trying to cater to a very active FNO traders, who like, you know, these cars, where you have a lot of switches, and you know, they everyone wants to have that car, which has a lot of switches, and you know, cockpit level, flight pilots cockpit, right, you know, you never use, but you want to see, right, traders are almost like that. But then we were trying to go after a new crowd by 2013-14, which is the investor crowd,  who was not probably as active as traders. And we had to build one platform, which had to cater to both, right? Unlike a lot of Robinhood, caters just only the investor class, right. So that, but we have the problem of, you know, having to cater to both kind of clients. So I think him and the team that he, we built around him as kind of killed it today in terms of, you know, just how good the product is.

Krishna Jonnakadla  28:29

And I'm happy for you that you've been able to figure that out. I've had my own stories. But sometimes something just fall into place you understand? Does the age gap have anything to do with it?

Nithin Kamath  29:39

I need to thank my parents, I think it's, there's something in your genes as well, how to be I think I'm a very stoic person. So I in nothing bothers me now, so the problem, I think, what I've seen after investing so many startups is that founders don't like to let go of things. If I have something in my head, I talked about it. And if I had to bend my back a bit, or bend my back and say, okay dude you are right, and get over it, right has it, I do, try not just among the top people at Zerodha, even if you know, someone fresher would join in, if I bend my back, and if he is a little more happy about,  he gets he become happy, and he is more productive to the company, and I don't mind doing it. And so, that's an important characteristic that's required in order to be successful when running a business, you know, and I've seen enough startups screw up, because founders are very egoistic etc

Krishna Jonnakadla  30:43

Very interesting. So I always like to sort of say, and most people who are in the startup advisory space will say, the initial team sets the tone for the culture. And you, you've talked about your team from your broken days that work with you, where's up local freelance money that actually came out? But you also in some sense, had a second start after Kailash came on board? Right? Is, is there a conscious culture, you just talked about being flexible being open minded, and in some sense, also to admit, said it, maybe I was wrong. And it's refreshing to hear that. And there are always situations where this might be perceived as wrong, and that might be personalized, right. So when you get it, right, you just say it's luck. But in terms of culture, internally, and it's also fascinating that Kailash who you today see him as a co founder came in much later on, and actually blended sort of right it, if that didn't happen, we possibly wouldn't have had such successful products, successful platforms etc. So talk to us about do you consciously embrace a culture, is that something that you work on? Or is it just a personal example that you said, and therefore everything falls into place?

Nithin Kamath 32:02

So, you know, Kai keeps talking about this. Okay. He talks about how I'm a very benevolent dictator. You know, so, and he's been like, you know, that's the real way to kind of, you have to be sweet to  everyone, but you still have to take your decisions. So yeah, so the thing is, people who don't kind of fit into our culture we haven't hired, right, even though their skilled and etc. And we are probably the only startup,  whatever today with not a single person from an IIT or IIM ever joined our office right because it's not because, I don't like people from IIT IIM. I mean, most of the startups that we have invested into are from there. It's just that, it's the culture internally, it's very different. The first 150 people who joined us, maybe 5 have been laid, today, I don't think you will find another company, nowhere, where the iteration has been so low, right? Like, I play a lot of sports. And I have realized that attitude matters more than skills. Right? It's a team game, right? It's not about one person trying to show off his skills. So I'd rather have average guys with great attitude, versus greatly, scarly eyes with a really bad attitude. And I have a small team, which executes all prod projects for me. You can think of this as a product management team, like, how there are so many product managers in different company. Now, the average age of this team is I think 23. So I picked up really young guys with no freaking idea about anything, fresh from the college they came joined us, they worked for an year, they kind of understood the business, they kind of shown a little more than the rest. Right?  And today, they're just doing an amazing job. Now, when I look at product managers and competitors in other companies, I think it's, it's an over skill, kind of, have such kind of product managers for and also for small projects, and etc. So this is what it is kind of helped us grow as a business since then

Krishna Jonnakadla  34:12

So we switch gears a little bit and talk about your product, because you brought up the issue of product managers, even today. It is common place to see poorly designed products that are in India that absolutely make zero sense to the needs of the user. And it's not like just a bunch of clunky engineers pulling stuff that they're there, it's almost zero user empathy, and that scene is change. I like to say, there is a startup called ID Batter, the way they designed their packaging, right, their campaigns. And it is so refreshing it is almost like an American company would do. And I mean, good American companies, which we are bold as a models of doing the right kind of user behavior, marketing. And when we see Kite and Coin and all of these. I feel you're in the same league, maybe a notch above because your products are so well designed beyond Kailash, bringing in, that three interface sort of thinking. Did your understanding of the user base, still there, or the users their behaviors that you saw, how much of that played a role in designing these problems.

Nithin Kamath  35:23

I am the biggest beta tester of our products. And also, we trade quite a bit on it before anything goes out. And Kai and even me today, thanks to him, I think we become so finicky about every single button and every single thing that goes on the platform that there's a lot of love gone behind it. And, and it's evolved, you know, in 2015 version of kite wasn't, was probably like 20% of today's Kite, right. And we've kind of learned or over the last four or five years and what people are looking for in our products. And I think the other thing that I think it's good for our businesses that we know, what is the problem you're trying to solve. Right, which is, with Kite and Coin, you want to be a great execution platform, right. So if someone has an intent to buy or sell, you want to be the best place in the country for that. I think the problem with a lot of companies is they don't have that problem, single problem they're trying to solve for, you know, like even us, we can do advisory we can do news, we can do research, we can do whatever I can, we can put all of that in one place, like how a lot of competing, broker firm apps do and make it clunky, and, and noisy and etc. So with Kite and Coin, with Kite you want to be the best place in the country, the easiest way, the cleanest way to buy a stock, we still have a few legacy issues on kite, because the underlying order management system, which is like, think of it as like how a Porsche Where's its cars using an Audi engine. So the engine is actually by Thomson Reuters. So that's, one piece of the business, which is still not in house, because that auto management engine has to be tried and tested for like years and maybe decades before we can actually put it in place. So that we have used TR's and we built everything on top of us. Because we used TR, there are few legacy issues on kite itself. Like when you buy for a stock for intra day we call it MIS, right, just having that word MIS is kind of confusing, and also, but I think, you know, slowly and surely we're trying to let go of all those legacies. But I think the fact that we spend so much time testing it, we have such a big community of traders and investors,  who are so interactive with us, like, if you look at our blog post, you'll see blogs with thousand comments on it. I don't know if you find Indian blogs, where no company blogs where you know, you have more than 1500 comments.

Krishna Jonnakadla  37:58

We have all heard stories of Kings going incognito or in costumes and walking around and roaming around freely amongst their subjects to find out the state of the country, the state of the kingdom, in order to equip themselves with first hand insights to run their kingdoms and their fiefdoms better. And this is equally applicable in the world of entrepreneurship. And if you see what Nithin and Zerodha are doing with their blog posts, which has hundreds and thousands of responses, they're doing exactly the same. A smart and a great entrepreneur always knows that he has to be in the market and completely engage with their users if they have to stay relevant and continue to create exceptional value for their stakeholders. And while it sounds simplistic, their blog posts and their nature of engagement with their users equips them with that uncanny insight, which allows them to be on the cutting edge. And also gauge users interest feelings and emotions that are likely to drive introduction of new product features and specifications.

Nithin Kamath  39:13

We have blog posts where people actually come, talk about what they're liking what they're not liking. I mean, usually 90% of it is, is just request and new features. But you know, this 5 to 10% is some sensible, you know, features and requests that come through it. And as a team, like, we have three very popular initiatives, Z-Connect, War City and trading Q&A library, like initiatives where we interact with the customers.

Krishna Jonnakadla  39:40

You deliberately kept them as separate apps and products. So we don't have one clunky interface that close it.

Nithin Kamath  39:46

Right. And then different kind of customers are coming on these three different platforms, and giving us feedback in terms of what they like what they don't like. And I think that's how all of this together. And as I said, it's a great team that we have the tech side as well, you know, which is helping us put these products in place.

Krishna Jonnakadla  40:06

So on the user base, when when you see maybe the kind of users that you had, when you were primarily a brokerage firm, versus what you started seeing once you became a tech platform sauce hasn't changed?

Nithin Kamath 40:20

Yeah, absolutely. You know, so when we started the business, it was essentially meant for FnO traders, right? Very active people who do it for a living. So in 2015, December, we were at around 70,000 clients. Now, like one of the things that, we did in 2015, which became very vital for us was we went zero brokerage for equity investing. And that was done because we were becoming whitewash, as only for us, you know, if anyone wants to speculate there is broker called Zerodha, which charge very less. By then we had our, web based platform Kite. So we now wanted to attract investors. So we said lets go zero broking for equity investing, once we did that the vitality kicked in. And we started getting completely new kind of customers. Customer who was looking at investing once in a while, who wants to buy mutual funds, who is going on who's not really trading hundred times in a day. And I think the next tipping point was de-mon. And yeah, de-mon was probably the biggest tipping point that we've had. Because the big challenge in this industry was just onboarding a customer. Onboarding a customer earlier meant a 30 page document, which has to be signed and proved. Today, you can use Adhaar to do KYC, sign it and open it online completely.  So people are not using Adhaar before the de monetization. After de-mon they started using Adhaar. So suddenly, there was other other use cases of one of which was for KYC, and signing a document. And the first five years, we opened 70,000 account, Jan 2018, right after Demo we open 70,000 accounts in one month, so it's so that was the kind of scale we saw post these tipping points, which is us going zero and then the Demonetization.

Krishna Jonnakadla  42:00

We will come back to the user base. But the India's facaset as it was called until recently till the whole Adhaar repeat a set of in personally, while I don't have a pet peeve, I believe that was going to be a game changer. Even Thankfully, the amendment has come back. Because the benefits that it caters and creates, vastly outstrip the number of people that actually get deprived from it. Unfortunately, we are managing for an outlier, which we shouldn't be. So if you for example, today, millions of people are employed in the unorganized sector. Without an identity like an adhaar, they don't have any history to built. And we are perennially running after documents, which adhaar actually obvious completely. So it is one thing to talk about a big brother sort of a government, but to completely ignore that there are vast tracts of benefits. And I personally I would have said if you are trying to do something look at the India fact. Because when you started out you had the trading platform, which NSE provided. And these are infrastructure enablers that are just waiting to be taken advantage of. Right?

Nithin Kamath  43:31

I mean we would not have happened if not for Aadhar. There is no way to open 70,000 accounts, which is you multiplied with hundred pages, you know, with all the to and fro per account, right? I mean, the kind of scale that you would require to open 30,000 accounts, right is something is just not possible. It would have been a logistics nightmare. And also,  because these clients are not in one place right there from across the country.

Krishna Jonnakadla  43:56

So you would have been a technology firm that was dragged down by the legacy issues

Nithin Kamath  43:56

Absolutely!

Krishna Jonnakadla  43:56

but Adhaar unshackled you from it. So it truly unshackled technology and then really made it available as it should. Right. That's what I believe technology should democratize access to good things and bad things also.

Nithin Kamath  44:15

No, I mean I have friends who are quite against that,  really vocal friends. And, I mean, there are issues with Adhaar which needs to be fixed. But then the use cases it presents, for businesses, to kind of, you know, kind of let labor and grow. I mean, I don't think there's anything else in the country, we're not going to go back to Stone Age if there was no Adhaar.

Krishna Jonnakadla  44:38

In the consulting world, there is a saying that don't throw the baby out with the bathwater. And the equivalent is, we sort of have a notion where we are always chasing the impossible perfect, but we are ignoring the possible good that is right in front of us in that chase of the impossible, perfect because no system, you know, as long as it's human created for whatever, is going to be 100%, perfect, as opposed to remedy in the defects if we are just going to throw the entire system altogether, I think will do years of work. So let's come back to the user behavior. You've seen so many of them. I don't know what sort of data you slice and dice and I have you seen a shift in behavior, the way the kind of users that come in the kind of investment patterns that you see? So are you seeing and shaping behavior at the same time with your products and platform.

Nithin Kamath  44:39

So 70% of people who open accounts with as a first time investors, so they haven't done this before.

Krishna Jonnakadla  45:35

So you are truly opening up newer markets.

Nithin Kamath  45:39

Yeah, I mean, that's, that's the exciting part of the business, it's not that and lot of our competitors thing that we are poaching plans from them. It isn't actually, and also, these are people who are we are adding to the ecosystem, which most of our competitors are kind of struggling at. And the other thing is 75% of them are less than 37 years of age. So it's one of those, very new age, millennial half population who come in, because there is a good product to use. I don't think the person who uses our product would ever come and invest if he had like one of those old banking products to invest on. So in terms of the activity itself, what and how people invest, I mean there's a big problem there and I think in India, the problem is that I don't think we are financially educated, anytime, whereas in right from school to college no one has taught us, how to manage your money, and we come out of college as get our jobs and end up picking up whatever our parents did, or whatever our friends are doing,  which isn't probably the right thing to do as well. And also, that is something that, you know, we are struggling with.

Krishna Jonnakadla  46:56

I see some books that focus that you seem to have.

Nithin Kamath  47:00

I'm in varsity, the initiative is education initiative that we run, today, after investopedia is called is the second largest in the world around capital markets. Right, not in terms of interaction and etc.

Krishna Jonnakadla  47:10

And it has completely free, right?

Nithin Kamath  47:12

It's completely free. No, it's it's like a MOOC initiative. And also, as part of varsity, we said, probably we need to do something to kind of educate kids. So yeah, so rupee tails is like five stories, which introduce kids to finance. And yeah, so we've been trying to educate people. And the other side, we've been trying to offer great execution platform. And we've stayed away from advisory, because we realized that people aren't great at following advice. So but, you know, there is, you know, I think one of the things that I get sleepless nights on right now, is that when people come and not invest the right way, just to give you an example, right now, the two most held stocks by all our clients is Yes banking and Tata Motors, the worst performing stocks in the last three years, either, so they are actually the most held stocks in Zerodha.

Krishna Jonnakadla  48:10

And Yes Bank just went down below book value yesterday.

Nithin Kamath  48:13

So yeah, so we are, I mean, one of those things on top of my list is to find ways to help people now to kind of invest as well. So I don't have an answer to it. But that's what that's on my list right now. 

Krishna Jonnakadla  48:30

You're perhaps a role model, maybe an unintentional role model, if you will. Because even today, when I was recruiting talent for my own startup, I've had interns who come in and do great work. But when you ask them what they actually want to do, they all want to go to an MNCs and Michael Siebel, of Y Combinator talks about this sort of unintentional conspiracy by fans of the world to take away great talent from other startups. Right, but who takes the Road Not Taken, so to speak? What would you tell some of these people, you know, because I believe the next 20 years in India is one of unprecedented opportunity. And like john F. Kennedy once said, the world's danger in Japanese also represent opportunity. So India is work in progress, maybe to be like that for the next 40 years for you don't know, but there are immense opportunities. So compared to when you started 2010 the awareness about startups and being able to do, was not as it is today. Today's almost fashionable to be an entrepreneur, it's a badge of honor.

Nithin Kamath 49:35

Right!

Krishna Jonnakadla  49:35

What would you tell people who are graduating out and still aspiring to be part of that headline in economic time saying young grad out of IIM gets hired for one billion. so what would be your message?

Nithin Kamath 49:46

I think, if I were to look back at my life, I think it's about finding that thing that you love to do. So I mean, the earlier you find it, I think, the better chance you have being successful in life. And the thing about finding what you love to do involves you trying out a bunch of things, it's very hard to pick up that one thing and then say, I'll fall in love with it or not, no chance of that happening is very less. So I've given a shot at it, almost everything. I mean, I like I've tried to play sports professionally, I 've tried music. I've tried magic, I've tried, like, no one tried dancing, I think I was probably the worst dancer. But you know, the sense I've tried to pick up as many skills as possible. And then I realized that, what I do with the stock market, etc, is what I you know, what I'm good at, and I love doing and, and I've built a career around what I like to do. And I think a lot of times where I see is people end up doing it for the heck of it, and not loving it. And when you do it, I mean, you might have a good salary. No, but I don't know if you will be successful. And I today everything money really is the success point, right? I work like 14 hours a day and and I'm happy about it. And so that is, I think, is this true success and,  for that to happen, I think people should firstly be open to an attempt multiple things and find something that you love to do and and then give hundred percent effort to get here.

Krishna Jonnakadla  51:30

So outside of the two busts that you went through during your trading, like as a trader, were there any near death moments in the Zerodha journey that you thought, maybe you're going to lose the plot? And  people tend to make lousy decisions when they're in big moments. Were there any and talk to us about how you came out of the moment?

Nithin Kamath  51:53

I think again, like I was saying, right, I think there's something in the genes that when I went bust, I actually laughed about it, which was to go back and work some 8000 rupees salary for like three years. I mean, but then it didn't, it didn't really affect us. I think I'm just a little gifted from my parents that I can, you know, take this near death moments very casually, and kind of laugh it out and go through it, that menas like the hundred near debts before zerodha.

Krishna Jonnakadla  52:28

During Zerodha ?

Nithin Kamath  52:30

With Zerodha, I think we had super lucky.

Krishna Jonnakadla  52:34

Almost, no zero death moments !

Nithin Kamath  52:35

Yeah,  there was no real zero death moment. The thing is, we have grown organically. We have never spent more money than what we could afford to spend. Usually the near death moments happen, you know, when you kind of over stretch yourself. I've done that quite a bit as a trader before. But I think the experiences trading, trading and running a business is very simple. You know, it's all about money management, right? And it's about having enough chips to continue betting, right, and not just losing it all kinds, right. So it's, so I think that's a skill picked up trading and play poker every weekend. And I think that's a skill that helps you will think poker as well. So, and which comes in use when you're, you know, running a business as well, which is, if today as a business, if I feel that anything that I do is going to bother me, I would not do it. Right, in the sense, like, if, unless I know the maximum damage, something that we're doing can cause. And if I can make peace with the damage, I do it. If not, no, I wouldn't do it. Because I should be able to walk out of it and not be stressed about it. 

Krishna Jonnakadla  52:41

Great way to look at it.

Nithin Kamath  53:53

Yeah, because it has worked. It's worked over the last 10 years, you know, we are probably the most most aggressive company out there. But they're probably also the most conservative company.

Krishna Jonnakadla  54:06

Every smart entrepreneur is also a smart investor at heart, he knows that his ability in succeeding lies in his ability to preserve his capital and grow it at the same time. Therein lies one of the most crucial skills of entrepreneurship, which is capital allocation, which is very rarely discussed or hardly discussed. And it is this smart capital allocation that Nithin has done, when he talks about taking so many small bets, which look aggressive for the market, but conservative for the company, that does not end up in betting the farm. Because if you bet the farm, and if you lose, you have no chips to play. But if you're smart about it, and bet what looks like the farm with the market, you still have a lot of juice left, and you will have a lot more to do. And that is exactly what Nithin has done with rain matters with all the various products that they have launched. And that's a terrific strategy.

Nithin Kamath  55:07

Because we have given shot at more shots on building products, than anyone that's out there. But then every shot has been our most conservative shot in terms of the risks that we will take on that shot. No, so it's, and then, you know, we have started and killed, I don't know how many products, you know, over the last four or five years. And if it didn't make sense we have killed it, we will not been trying to throw bad money and good money to make it right. You know, which is something a lot of people do, not just entrepreneurs, even just see very often the investing community as well.

Krishna Jonnakadla  55:41

So what would you characterize as that good experiment, in hindsight, 2020, year after you've done it, it's sort of evident to you that it was a bad, good move. So when you make those decisions, what is the process in your mind?

Nithin Kamath 55:54

Yeah, so one is in a regulated kind of an environment. You se the thing is, innovation kind of has to lead regulation. Right. There's no doubt about it.

Krishna Jonnakadla  56:08

Yeah. Nothing to regulate, if somebody's not innovating.

Nithin Kamath 56:12

Right. So every product that you come up with, you should be able to at least ask for regulatory forgiveness, if it is not, in at least in our space, right? Where you're regulated by so many people. Like, yeah, then you say sorry, you know, but this is done with an intention to kind of help customers and etc. And it doesn't, you should be able to get away with it, so it cannot be a regulatory dark grey, it can be a regulatory light grey, right. So usually, for me, that's the first take point, like you put this, someone will call me up and say Dude Nithin. Right. So at that point of time, I know if this will actually survive a few years or not. And the second thing is, of course, you know, the thing about this, you know, this whole connected to your client business, right? Unless you give a lot to the client, no one's going to give you back.

Krishna Jonnakadla  57:01

User empathy!

Nithin Kamath  57:02

Absolutely. I mean, like, I still spend two hours a day answering people's queries, right, on all of our online forums. So when we go out there and put something people genuinely come back and give you genuine feedback, right? I mean, we cannot not be doing anything one day, put up something and say, Hey, tell me.

Krishna Jonnakadla  57:18

That's just in a vacuum doesn't really make sense. So you said a lot of things being closer to users, staying connected with them. And in some sense, can you say don't bet the farm on your product.

Nithin Kamath 57:33

Absolutely!

Krishna Jonnakadla  57:33

And today, I guess you already have a user base, where you have to be a little careful about what you put out there as well. So that it doesn't alienate large, large tracts of people.

Nithin Kamath 57:43

Yeah. So like, you know, one of those growth hacks that has worked very well for us, is this whole Rain Matter initiative, where we have allowed startups to kind of come leverage on top of us. And we're probably the only financial services business in India, or actually, any business whose other businesses come with leverage on your database. So here a startup can come and access our million and a half customers. And yeah, absolutely not crazy about the database. And also, for us, it is like, you know, our customer gets access to a good product.

Krishna Jonnakadla  58:15

You almost make it look like it's, it's a no big deal. But wherever you see, I once heard an article, I think, what, six months ago saying, the depth of the internet startup, because today, Facebook, apple, all of them have become wall guards, once they've built all of their ports, and with millions of users in them, they've actually closed down access, and virtually charge a ransom, source fee, you know, for you to get any sort of access, which means the earlier way in which you could build large tracts of users, and I hope these platforms virtually went away, but you're actually going in the opposite direction of opening up your user base and come do interesting things with them. As long as you fall within this framework, of course. So whatever we think makes sense for it. So which is a very refreshing initiative.

Nithin Kamath  59:04

I mean it's kind of helping us grow significantly as well, because customers know that if they are customers with us, they want to get access to this entire new ecosystem of products which are probably going to help them in some form or the other in a symbiotic. Absolutely. And I think like, I don't know, if he would be able to run such initiatives, which we had third party investors, if there was a board to go get approvals on our own, right, so I don't think these things would have any, it'd be easy to kind of....  Because it doesn't make sense, you know, like for an investor, but right now, he's investing into one company, right? Now, this company has spent that much money to build a million customer database. Now a third company, which is he's not invested in Yeah, gets to come... gets access to this million customers instantly? for free Right, right. And then........

Krishna Jonnakadla  59:55

It's about a certain amount of maturity in that as well. Somebody who's fiercely protective, possessive can't really take something really too far. And maybe the examples are one in a million, but otherwise, and that maturity is growing, I would say, where people recognize that you need a symbiotic environment. And you know, I make it a point to tell a lot of startups also that when you are starting something, see there is an enabler environment period. So for example, you not only build a user base there are API's stack so people can take tools, sort of a toolbox and say, Hey, I build this mashup, then and then you use case that may not be very evident to you. So what you did when you started off with NSE platform.

Nithin Kamath  1:00:39

Absolutely.

Krishna Jonnakadla  1:00:39

So those are game changers. And I, maybe the investing community will change over a period of time and grow up to the concept. I got two more questions. One on what's the real Nithin Kamath like to see like a person, we've talked a lot about your entrepreneurial side? What does he love? What does he do in his leisure time....

Nithin Kamath 1:01:01

So I haven't read a book in last 15 years. So it's just this whole business.

Krishna Jonnakadla  1:01:09

So you write one now then

Nithin Kamath  1:01:10

No.... other than writing, you know, signing on checks. I don't think I've written anything. No, I mean, jokes apart, I think it's just that the last 15 years has been such as I don't know where it's gone. You know, like how times has gone away don't have it. And I know I picked up books, but then I couldn't actually sit through it. Because I didn't have the like, you know, your mind is always at work, right? You're always thinking business business business. But one of the biggest growth high, so the last year has been to get on audible and podcast. And one of the reasons I am actually.....because this whole every day, you know, you end up on an average one hour in traffic somehow, right. And that one, now for me is like a library. As in, I'm enjoying it more, I actually take you know, if Google Map says This road is got more traffic, I actually take that road to be able to kind of listen to more, you know, and I'm enjoying it. And I keep pushing everyone in the company to say that because there's no more road rage, there is no peace on the road all the time. And I'm actually looking around having fun. I'm driving nowadays. So on Audible and right now listening to rise and fall of the third reich. Right. Okay. And it's a 50 hour book and it's really interesting.

Krishna Jonnakadla  1:02:03

I follow a lot on my driving, and I listen to books and podcasts all the time.  When it comes to fiction and stuff like that....

Nithin Kamath  1:02:42

Yeah, so I'm enjoying that. But apart from that, like I was telling you before, so how I've just too many interests in life. So I play a lot of sports, I love to swim,I love all kinds of music, and also i love my booze, I love my chocolates, and my wife is an avid traveler. So she ends up forcing me to go on breaks quite often. So I'm having so much fun doing whatever I'm doing right now. So it's just times going away quite fast.

Krishna Jonnakadla  1:03:19

You have been awarded Entrepreneur of the Year, and one of the top 50 business people in India to watch out for and all before you hit the 40 number, right? So what's in store for Nithin Kamath & Zerodha over the next few years, what other milestones and pinnacles and summits, you are planning to scale

Nithin Kamath  1:03:38

This whole awards and PR, right? That's not as as a business, it's not me as a business. It's not, you know, any of us who work another job, in the business of money, credibility is important. And people associate what comes in media is critical, right? You've been forced to go out and take that effort to apply for the awards and etc, etc. But in reality, I think if I have an option, we would have not done it. Because these mean nothing actually right as in your what your users think about your product is what's most important.

Krishna Jonnakadla  1:04:13

Right

Nithin Kamath  1:04:13

And and on the business side, you know, I think once you have enough in life, know that money is no more the motivator, you know, I think money stopped being the motivator five years back, right? Because by then, so I think as a business we had made enough, which would cover my lifestyle for this generation. As money stopped being motivated long time back. Now it's about just not building great products. Now, we are about to launch a really cool feature on the platform. And I'm super excited about Monday when we launch it just to know what our clients think about it. But I think the big problem in India is that we are running too much on foreign money as in our economy runs on foreign money. And and the reason for that, I think is India, Indians put too much money in real estate and gold. And the reason for that also is because historically, inflation in India has been quite high. And so when you see in any part of the world, when inflation is high, people get into physical assets versus financial assets, right? So, there is a certain behavior in India. I think someone has to enable them to kind of move away from those physical assets that add no way benefit to the economy to kind of shift to financial assets, I put money behind entrepreneurs, invest in stocks, buy fixed income, like I said, know, put some money behind, get products from companies, etc. And, then at least your money is going to help the country. We want to be an enabler who kind of make this happen. We can solve for it, I think we will do well as a business as well.

Krishna Jonnakadla  1:05:46

I personally think the real estate market, it's in our 20 year slump right now, and it's not recovering. The next boom is only going to happen in decades but I think it presents an opportunity, like you said in 2010 would have to be a wrong time anybody associated with real estate today will be possibly called a fool. But I believe the securitization of real estate assets hasn't happened at all in a year, outside of a few leads, which are again clones of Western products. Indian needs products that are very contextual. There are still millions of homes, but none of those have been unleashed. Today it takes forever to get a home sold. And once those get securitized, and those get converted into tradable instruments, a whole new class of people will actually come out to the market that will start demonstrating different behaviors. Hopefully, you'll pioneer some of the trends.

Nithin Kamath 1:06:38

Yeah, I mean, I think if real estate wasn't driven so much on this whole parallel economy, I think you do happen. But today, you know, like for every house, there is a white component. How do you bring the black component and how do you securitize that? So that's, I think it's gonna happen eventually.

Krishna Jonnakadla  1:06:56

I think the writing is clear on the wall now. So Nithin, it has been fantastic chatting with you. I'm sure there are a lot of key takeaways from today's session, which were vastly different. We enjoyed chatting. Any final comments before we close up?

Nithin Kamath 1:07:11

 No, I think you just covered everything. Thanks. Thanks for having me on the show and Cheers.

Krishna Jonnakadla  1:07:16

Thank you for being on Maharajas of Scale. It was a pleasure chatting with you and we wish to see Zerodha and you scale new heights and making the awesome things happen.

Nida Sahar  1:07:27

We hope you enjoyed this story. If this story made a difference to you, tell us by leaving a comment on the website or our social media channels. Help us spread the love by subscribing, liking and sharing our  show. We welcome speaker suggestions and collaborations. Write to me at NIDA@maharajahsofscale.com