February 13, 2013 6 Comments
Mythologically, the Agarwals trace their origin to Agroha, a small town in Haryana,in North India and regard King Agrasena as their progenitor. A Bania subcaste, the Agarwals are made up of 18 clans, among them the Gargs, Goyals, Bansals, Mittals, Singhals and Jindals. As traders and entrepreneurs,in India, the Agarwal community,like the Chettiars of Tamil Nadu and the Moplahs of Kerala, have no mean reputation — the community is prosperous and has proven its mercantile mettle over the centuries. Businessmen from Agarwal clans are among the wealthiest in India and include the Bharti Group’s Sunil Bharti Mittal, Vedanta Resources’ Anil Aggarwal, Naresh Goyal of Jet Airways and ArcelorMittal’s Chairman and Chief Executive Officer LN Mittal.
In traditional business families from such communities, members are used to having strategy for breakfast, accounts for lunch and operations for dinner from an early age. Even so, the extent of domination by the Agarwal community in the virtual world is astonishing.Even among trading communities, the Agarwals have proven to be especially prolific at launching e-commerce ventures.Even those with a distinguished academic record end up starting their own ventures.The who’s who of e-commerce entrepreneurs is drawn mostly from the ranks of the Agarwals. Companies run by young Agarwal businessmen, among them Flipkart, Snapdeal, Yebhi, and Myntra, account for the majority of sales by Indian e-commerce companies. And last year, for every $100 in funding for e-commerce companies, $40 went to firms founded by an Agarwal.
Vibhore Goyal is an Indian Institute of Technology-Bombay alumnus and co-founder and chief technology officer of student assessment portal CoCubes.com. This is how Vibhore explains the extraordinary success of his community in e-commerce: “We are often good at calculations and accounting….Kids from the community are more willing to take risks as they have seen its reward in the past.” Rohit Bansal, an IIT-Delhi alumnus who is co-founder and chief operating officer of Snapdeal,echoes him“We have the maths, finance and data skills that are extremely important for e-commerce.”
Even the Agarwals working for companies tend to find out gaps in the organisation’s offerings and launch businesses very quickly to fill those needs. That is why it is not too common to find Agarwals as chief executives of Indian or multinational corporations.
Its hard to rule out genetics in the entrepreneurial success of the Agarwals as no systematic studies have been made of the causes of the success of India’s business communities. Undoubtedly early nurture and the presence of good entrepreneurial role models in childhood, along with the prestige associated with being a successful business person in these communities, have their place in explaining their success. But another major factor is the social interactions and community networks based upon which finances are raised ,partnerships forged,staffing and marketing done etc. Agarwals know how to set up and run a business and their children have a head start and better opportunity to learn, if they are so inclined.