Groww’s Growth Story: Revolutionizing Retail Investing with a PLG Strategy

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Welcome to the 72nd edition of The Growth Elements Newsletter. Every Monday and sometimes on Thursday, I write an essay on growth metrics & experiments and business case studies.

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Is Groww revolutionizing retail investing in India?

Groww offers a simple way for retail investors to access various investment products like mutual funds, stocks, ETFs, and derivatives.

[1] 𝐔𝐬𝐞𝐫𝐛𝐚𝐬𝐞, 𝐔𝐬𝐚𝐠𝐞, 𝐚𝐧𝐝 𝐏𝐫𝐨𝐝𝐮𝐜𝐭 𝐎𝐟𝐟𝐞𝐫𝐢𝐧𝐠

• Over 50 million registered users

• 6.63 million active NSE clients

• Products include MF, stocks, ETFs, F&O

• Grew from 5.1 million active users in 2022 to 7.6 million in 2023

[2] 𝐆𝐫𝐨𝐰𝐭𝐡 𝐒𝐭𝐫𝐚𝐭𝐞𝐠𝐲, 𝐏𝐋𝐆 𝐚𝐧𝐝 𝐀𝐜𝐪𝐮𝐢𝐬𝐢𝐭𝐢𝐨𝐧

• Uses PLG model

• Freemium lowers CAC driving growth

• High user growth in derivatives trading

• 80% of broking revenue comes from F&O

• Smooth onboarding and low trading fees

[3] 𝐑𝐞𝐭𝐞𝐧𝐭𝐢𝐨𝐧, 𝐒𝐭𝐢𝐜𝐤𝐢𝐧𝐞𝐬𝐬, 𝐚𝐧𝐝 𝐔𝐧𝐢𝐭 𝐄𝐜𝐨𝐧𝐨𝐦𝐢𝐜𝐬

• Retention rate around 90%

• Churn rate is under 5%

• Users report 25% better returns using Groww’s automated investment tools

• Low CAC and high retention giving a healthy LTV to CAC ratio

[4] 𝐌𝐨𝐧𝐞𝐭𝐢𝐳𝐚𝐭𝐢𝐨𝐧 𝐚𝐧𝐝 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 𝐌𝐨𝐝𝐞𝐥

• Revenue from brokerage fees

• Derivatives drive 80% of brokerage revenue

• Unit economics benefit from low operating costs and high customer retention

• Wealth management tools expected to increase ARPU

[5] 𝐑𝐞𝐯𝐞𝐧𝐮𝐞, 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐚𝐧𝐝 𝐕𝐚𝐥𝐮𝐚𝐭𝐢𝐨𝐧

• FY23, ₹1,277.8 crore ($153 million)

• 266% increase from the previous year

• Net profit of ₹449 crore

• Raised $400 million in funding

• Valuation around $3 billion

That's it for today's article! I hope you found this essay insightful.

Wishing you a productive week ahead!

I always appreciate you reading.

Thanks,
Chintankumar Maisuria