Rising from a middle-class background to build a financial empire, self-made billionaire and co-founder of India’s largest retail brokerage Zerodha – Nikhil Kamath – never stops learning.
By Nichola Marie
The lore of Nikhil Kamath — who, according to ‘Forbes’’ 2024 list, has a net worth of $3.1 billion, thereby making him India’s youngest billionaire — keeps growing. Interest continues to rise in the Co-Founder of Zerodha, the disruptive trading platform he established with his brother, as well as, True Beacon, an investment management firm for ultra-high net-worth investors.
Recently, Kamath, one of the most popular names in India’s startup scene, shared an anecdote from his childhood. In the course of his conversation with LinkedIn CEO Ryan Roslansky, he revealed how he started a business venture during his school days, which didn’t exactly pan out too well… A “rebellious child” who wanted to do the opposite of everything someone told him to do, he revealed, “I hated school, always did.”
Business Idea Down The Drain
Born on September 5, 1986 to Revathi Kamath, a skilled veena player and Raghuram Kamath, an executive at Canara Bank, and growing up in a small town in Karnataka, his anti-school views were not appreciated. He did drop out of school in his early teens, wanting to pursue chess as a career. However, as he admitted to ‘Arabian Business Industries’, despite his early talent for the game, chess didn’t earn him enough to make a living. What it did, however, achieve, was hone his analytical mind which would prove useful in times to come.
Coming back to his anecdote shared with Roslansky, at the age of 15 or 16, he had his first business idea. It all apparently started with a cell phone, a second-hand device that he sold at a small profit. He used this money to buy more cell phones which he released at a better price. However, this ‘business venture’ came to a screeching halt once his mother found out about it. She promptly flushed his entire phone inventory down the toilet!
Kamath also shared that he was a “fairly insecure young boy” because his classmates at the time were in college. One positive was, to overcompensate for that insecurity, he would read whatever he could lay his hands on. He believes he has learnt everything he has only through failure. His rationale: “I don’t think success teaches much outside of creating an ecosystem where it is easier for you to get complacent.”
The Lightbulb Moment
After leaving school, he took up work at a call centre. The work, as he describes it, was a “soul-crushing nightshift job” which Kamath made bearable for himself by learning about the stock market and trading, inspired by his brother. He even became the investment manager for his whole team; such was his knack for it!
It was to be a pivotal moment in his early career. Being introduced to stock markets for the first time and making that first trade that made him money – discovering that something like that was possible – is his most significant memory. As he said in an interview to ‘South China Post’, “As a trader, one of my most cherished memories is making my first profitable trade and realising the potential of the stock market.”
A LinkedIn blog about Kamath says, “That was the lightbulb moment for what became a rulebreaking journey through India’s financial world, where, to this day, he challenges traditional norms and empowers everyday individuals to take control.”
The Zerodha Story
Beginning to trade stocks, in 2006, he became a sub-broker, starting Kamath & Associates, a brokerage firm along with his brother Nithin Kamath to manage high-net-worth individual portfolios in the public markets. In 2010, using their own savings, he and his brother founded the disruptive trading platform Zerodha, which would go on to make him one of India’s youngest billionaires.
The idea came to him when he detected a glaring gap in the system. Noting the many obstacles that had to be dealt with before any profit could be earned, Kamath and his brother hit upon the idea of starting a simple and affordable brokerage platform. His motive was to ease retail trading for the everyday investor. Thus was born Zerodha, a name that combined the words zero and rodha (barriers in Sanskrit). There was no looking back.
Zerodha provides brokerage services for dealing in stocks, currencies, and commodities. The winning factor: Kamath introduced a discount brokerage model which reduced the commission charged for transactions, enabling the masses to invest. Zerodha would go on to handle 15% of India’s total retail trading volume, with a US$10 billion daily turnover average, becoming ‘India’s largest brokerage and execution platform’ by active client base. His deep understanding of technology combined with his hands-on approach to innovation proved instrumental in scaling Zerodha to its current success.
After establishing Zerodha, Kamath turned his attention to the top end of the market which he believed would benefit from a more bespoke approach to wealth management. This saw the start of True Beacon, an asset management firm that advises ultra high-net-worth individuals on how to manage their fortunes.
In 2021, he also co-founded Gruhas, a venture capital firm focused on supporting startups in sectors like AI, climate and media.
Admirable Impact
Forging his path to success through hard work and his choice of an unconventional route, Kamath’s story is a validation of his innovation and determination. As a result, today, Nikhil Kamath’s impact on India’s economic landscape is unmatched, and his entrepreneurial success is widely inspirational.
Recognition has also come his way via awards such as Entrepreneur of the Year in 2016, followed by a spot on Forbes’ 20 Under 20 list in 2017. These honours reflect his impact on the financial industry as well as his role as a trailblazer in the world of entrepreneurship.
Philanthropic Contribution
Despite the pandemic squeezing savings accounts, Zerodha doubled its number of registered users to four million. As the business thrived, it doubled Kamath’s and his brother’s net worth from US$1.6 billion in 2020 to US$3.5 billion in 2022. In June 2023, Kamath hit the headlines again, becoming the youngest Indian to sign The Giving Pledge, thereby committing to donate 50% of his wealth to charitable causes like climate change, education, and healthcare.
This significant move reflects Kamath’s deep sense of social responsibility as well as his dedication to contributing to societal well-being. His commitment to philanthropy sets an example for future generations of entrepreneurs, even as it emphasises his belief in using wealth for noble causes.
“Looking ahead, the idea is to move the central focus away from doing well for oneself, to being a more significant part of the various communities I am a part of; businesses that are not just for profit but have an impact element – that is becoming increasingly intriguing,” he shared.
Beliefs & Interests
Kamath has a penchant for chess, which he says “teaches you how to work under a structure, in a system, but yet try and be creative within that system.”
He attempts to constantly stay grounded despite his success. Highlighting the importance of continuous learning, he notes that he actively seeks knowledge from those around him and the world.
He also credits timing as a key factor in his success. “Timing is everything,” he believes, pointing out that people often fail to recognise its importance. “I am cognisant of the fact that I have been quite lucky and in the right place at the right time, with great colleagues who have shared my journey.”
A voracious reader, he once revealed he reads one to two books each week. He particularly enjoys books on mass psychology.
Increasing Influence
His podcast ‘WTF Is’, which sees him host friends and industry experts and hold casual yet intellectually stimulating conversations, is growing in popularity. Prominent figures such as Ranbir Kapoor, Kiran Mazumdar-Shaw, and Suniel Shetty have featured in his podcast, opening up on a range of topics. While the chats inspire Kamath’s many admirers keen to make their own mark in the world, they also reveal interesting insights into Kamath himself, as he shares his own struggles and more. Startup India’s star is shining bright.
