How Nitin Kamath Built Zerodha’s Profitability Without Venture Capital or IPO

Despite not having an IPO or venture finance, Zerodha became one of the most successful fintech startups in India. A unique model in India's rapidly evolving startup landscape, Nithin Kamath's concept was centered on long-term value, trust, disciplined growth, and an unwavering user-centric approach.

Bootstrapped Beginnings

Nithin Kamath established Zerodha in 2010 with just Rs 10 lakh in an effort to address the actual issues facing Indian trade, such as hefty broker fees, misleading pricing, and unsatisfactory digital user experience. By avoiding outside finance and maintaining full ownership by the founders, the business was able to put the demands of its customers and long-term growth ahead of quick valuation increases or expansion for its own sake. "I may have been involved in the markets for another ten years prior to the fifteen years we have spent getting here. “If you are fortunate enough to be in the right place at the right time and love what you do, things compound over time,” Kamath explained.

No Costly User Acquisition

In contrast to its usual fintech competitors, Zerodha's expansion was not supported by incentives or advertising expenditures. Kamath was enthusiastic on the "zero cost of acquisition (CAC)" principle, saying that "we wouldn't be profitable if we had to spend heavily." The decision to set CAC at zero is philosophical. We're not in a rush to expand or reach X valuation. We have no influence over the rest," he stated. Rather, Zerodha employed product-driven word-of-mouth, referral incentives, and organic growth. Although it has a partner and referral program, expenses are solely linked to real revenue rather than payments up front.

Simplicity, Transparency, and Technology

By charging consumers Rs 20 for each executed order, regardless of value, Zerodha invented flat-fee brokerage, which allowed millions of people to see and understand expenses. The goal of significant technologies like the Varsity education portal and the Kite trading platform was to make finance easy to understand and use. Trust was further reinforced by other services such as Coin, which allowed commission-free direct mutual fund investing.

Lean Operations and Disciplined Hiring

Zerodha prioritized automation, technology, and efficiency in all processes from the beginning and maintained lean teams. Slow and deliberate hiring guaranteed scalability without operational bloat and culture fit. Every level of cost control made it possible to reinvest revenues in new products and user value rather than growth at any costs.

Long-Term Customer Focus

Kamath has frequently clarified that by remaining private, Zerodha is able to make investments that benefit users, "even at the cost of business," free from pressure from investors or shareholders in the public market. Zerodha has no aggressive revenue or sales targets and doesn't track or bombard clients. Because of this flexibility, the business is able to uphold consumer confidence, have open policies, and refrain from pressuring customers to buy undesirable or dangerous goods.

Results: Scale and Profitability

Without ever giving in to the uncontrolled burn model or VC pressure, Zerodha reports industry-leading profitability, services over 1.5 crore customers, and is entirely founder-owned as of 2025. With a valuation close to ₹30,000 crore (about $3.6 billion), recent financials indicate earnings of over ₹2,094 crore on ₹4,964 crore in revenues. In addition to strategy, Kamath credits timing, sustained market expansion, and a readiness to "say no" to hype and herd mentality for this achievement.