Startup IPO Rush: Decoding Groww's Growth Hack That Fuelled Rise From MF Distributor To Top Discount Broker

Billionbrains Garage Ventures Ltd, which operates with the brand name of Groww, is the latest to delight India's primary market with its Rs 6,632 crore public issue. Yet, unlike most IPO-bound startups, Groww’s story doesn’t glitter with celebrity founders or Silicon Valley glamour. It’s the quintessential Indian startup tale: humble beginnings, sharp execution, and relentless focus.

The startup, that began in 2016 with a simple idea of making investing as easy as online shopping, has in less than a decade evolved from a mutual fund distributor into one of India’s most profitable fintech companies.

As Groww enters the public markets, much of the debate revolves around whether its IPO price of Rs 100 per share is “overvalued.” But while analysts argue about its 33x price-to-earnings multiple, the numbers speak for themselves.

Groww recently reported a profit of Rs 1,824 crore on revenue of Rs 3,901.72 crore — an astonishing 47% net margin, in a sector where profitability is still a rarity. The revenue for financial year 2025 has more than doubled in the last three years.

What makes it even more interesting is that the company has been consistently profitable for five years, barring the one-time redomiciling tax expense in fiscal 2024 that has resulted in an accounting loss of Rs 805 crore. Most “unicorns” are still burning investor money to buy growth. Groww, meanwhile, is printing profits sustainably.

Another interesting element is that 85% of Groww's revenue comes from its broking services.

Groww became a unicorn in 2021, but just four months before its initial public offering, the company's last funding round put its valuation at $7 billion. The firm is likely to be valued at nearly $8 billion at listing.

What began as a mutual fund distribution platform now empowers users to trade in equities, invest in IPOs, and explore derivatives.

Groww has 11.9 million active users that represent 26.3% of the market share. The company has 83% organic customer acquisition, with 127% revenue CAGR of over three years. With 1.25 crore active demat accounts, Groww now surpasses traditional heavyweights — Zerodha with 75 lakh and Angel One with 73 lakh active accounts.

When Groww started in 2016, the National Stock Exchange had only 50 lakh active investors as investing felt complicated and expensive. However, if you see today, the image is wildly different. The NSE has close to 4.7 crore active users and this surge could be on the back of platforms like Groww that made markets accessible at the tap of a screen.

If you are trying to understand how Groww played a part in this investing revolution, then the answer is simple: It started as a mutual fund distributor, but after it got its license in 2020, it levelled up to become a stockbroker.

This was when things changed for Groww. The platform let users invest in IPOs, trade in derivatives and it also entered the NBFC business and began giving loans. The company slowly rose to become the largest broker on the NSE in terms of active clients with over 1.2 crore active NSE clients.

What sets Groww apart, according to analysts, is its focus on customer experience over aggressive marketing. Rather than spending heavily on celebrity ads or viral campaigns, Groww concentrated on perfecting its product.

Once users came on board, the platform offered a clean interface and seamless experience, encouraging them to explore new products — from UPI payments to bonds and derivatives. Through educational posts and explainer videos, Groww nurtured an informed investor community, turning users into brand advocates through word-of-mouth.

Interestingly, Groww builds most of its tech in-house, which means that the dependence of external vendors to fix bugs or roll out updates was nearly zero. It also helped the platform stay fast, reliable and ready for massive trading spikes. And in order to maintain this service, the company invested heavily in its tech and software. In fiscal 2025 alone, the company invested Rs 440 crore for their software, server and tech expenses. This was 67% higher than the previous year.

Due to this blend of simplicity, innovation, and trust, Groww has achieved a client retention rate of about 78%.