Alibaba Makes Internet Magic
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You may not have heard of the Alibaba Group, but investors, competitors and business leadersaround the world are paying close attention. Formed 11 years ago by high school teacher JackMa, is China's largest B2B Internet marketplace for small- and medium-sizedcompanies. Other holdings include Alipay, an online payment service similar to PayPal; AlibabaCloud Computing; and Taobao, a social networking and shopping site that Mr. Ma describes asa mash-up of Amazon, eBay . But it's the flagship company, , thathas been the incubator for his sometimes-unorthodox ideas on management and productdevelopment.
"We don't think about making money," Mr. Ma said in September during the Sir Gordon WuDistinguished Speakers Forum at Columbia Business School, sponsored by the Chazen Institutefor International Business. "We think about creating value for society, for the people, and forthe customer. And because we don't think about making money, we make money."
That might sound flippant coming from someone whose website raised $1.5 billion in 2007,making it the second largest Internet IPO in history (only Google's, at $1.67 billion, was larger)y, market capitalization for is nearly $10 billion, and Taobao has mushroomedinto China's largest retailer by some measures. That's all the more remarkable consideringthat Mr. Ma operates in a country with some of the most restrictive Internet censorshippolicies in the world. Still, he has succeeded by adhering to one simple six-word tenet:customers first, employees second, shareholders third.
The Early Days
Dressed casually in canvas shoes and a white windbreaker, Mr. Ma recounted for the audiencehis childhood in Hangzhou, a major city in China's Yangtze River delta. He was, he said, a fanof wu xia (martial arts) novels, and often got into fistfights as a young boy. He picked upEnglish on his own by acting as a tour guide for foreign visitors in exchange for languagelessons, but because he had difficulty with math, he twice failed his general college entranceexams. On the third try, he was admitted to the languages program at the local university,after which he began a career teaching high school English.
But along the way, the entrepreneurial bug bit. He launched a translation service and washired by an American businessman, who was bankrolling construction of a local highway, totranslate negotiations with Chinese municipal authorities. Part of the deal-making called for himto travel to Las Vegas to meet some investors, and it was there, in 1995, that he first heard theword "Internet." He then travelled on his own to Seattle to visit VPN, a small Internet serviceprovider with five employees. There he got his first look at the technology that would, within adecade, make him one of the most influential entrepreneurs in the world.