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Business Management

Alibaba's Ma opens up on women, China, rejection, Forrest Gump, tai chi and passing WalMart

Alibaba executive chairman Jack Ma lacks the media-trained sheen of many US CEOs and that absence is welcome. Playful, self-deprecating, humorous, fond of the west but not to the point of having “gone native”, he reminds me at times of that other big merchant of panoramic vision, Softbank CEO Masayoshi Son.

In an interview today at the World Economic Forum in Davos, Ma opened up to the CBS News anchor Charlie Rose on his life so far and his ambitions for the e-commerce phenomenon he started and runs. The highlights of this discussion, edited for sense, flow and brevity, are below.

 

On returning to Davos

“It’s a long break, seven years. My last trip was year 2008. I was coming [the first time] in 2001 for Young Global Leaders and I had never heard about Davos. [Ma saw a demonstration against global capitalism.] I say: globalisation’s a great thing, why don’t people like it? I was thrilled by so many ideas. I learned what globalisation means, citizenship, social responsibility. We can never win the world by talking [so I focused on growing the business] but now it’s time to do something in return because I learned so much.”

 

On starting out

Ma calls himself “100 per cent made in China”. He learned the English language and western views of the world acting as a free guide for tourists.

“There was no way to learn English, no books. When people say ‘Jack how come you speak English, talk like a western guy?’ That was the nine years. These western tourists opened my mind. Everything they told me was so different from what my school told me, my parents.”

 

Growing up

“It was the end of the cultural revolution. My grandfather was a tiny landlord and after the liberation he was considered a bad guy so I know how tough it was as a kid.”

 

The internet

Ma used the web for the first time on a 1995 visit to the US in a Seattle bank and says that if you had searched for China online in 1995 no data would be returned. He quips that his first search term was “beer” on a Mosaic browser over a slow link although at first he was frightened of using the computer in case he broke it and could not afford to pay.

He and a friend designed a “shocking” website focused on China.

“[A few hours after the site opened] My friend said you got five emails. I said, ‘what are emails?’”

 

Changing name

He uses “Jack Ma” because he had been told by a western lady tourist that his real name, Ma Yiu is difficult to pronounce. The lady’s husband and father were called Jack.

 

Alibaba

“I said to a waitress, do you know about Alibaba and she said ‘open sesame’. I asked about 10 people and they said ‘open sesame’ or ‘40 thieves’. Also it starts with ‘A’ so Alibaba is always top.

“For the first five years, I just wanted to survive. For the first three years we made zero revenue. I remember many times when I go to the restaurant to have dinner and when I was trying to pay the bill the manager of the restaurant would say “your bill is paid and [present] a small note [from another diner] saying ‘Hey I’m your customer. I made a lot of money and I know you don’t make any money.’"

 

Relationship with the Chinese government

“[From 14 months working at a Ministry] I learned you should never rely on a government to do e-commerce.”

Ma says he never received money from either government or banks. When he could have used it, they did not offer any and now he doesn’t need their money.

He advises staff, “Be in love with the government but don’t marry them. Tell them how the internet can help … Think about jobs, why the internet will improve China instead.”

 

Creating trust in payments

“The most important thing was trust. Everything we do is trying to build up the trust system. I’m so proud. Sixty million [trust transactions] happening every day. The banks said ‘this thing won’t work. I didn’t know what to do because it was against the law to create a payment system without a licence but if I don’t do it, it goes nowhere.”

Davos inspired him to say, “Do it now, immediately. If one body has to go to the prison, Jack must go to the prison. If you don’t do it properly [that is, if there’s any corruption, theft or money laundering] I will send you to prison!”

 

On becoming known outside China

Ma recalls that Time magazine called him “Crazy Jack”. “I think crazy is good. We’re crazy but we’re not stupid. If everyone agrees with my idea we have no chance.”

 

Alibaba by the numbers

Alibaba has over 300 million customers and 100 million buyers visiting the site every day.

800 million use AliPay.

The company is creating 14 million jobs directly and indirectly for China.

Headcount has grown from “18 people in my apartment to 30,000 people in four big campuses”.

Average age of staff is 27-28.

Today Alibaba has 10 million customers outside China. His goal is two billion customers globally, making Alibaba the “electronic world trade organisation”.

“We’re still a baby,” Ma says, predicting that in the next 15 years e-commerce will be treated as a utility, “like electricity”.

Growing and growing

“I remember in 2011 we went to raise $5m or $3m in the USA and got rejected and [today, after a $24bn IPO in the US ] I say we came back raising a little bit more.”

“What we think about is how we spend the money efficiently [to give] a good return. It gives me more pressure when our market cap is bigger than IBM. We’re one of the top 10, 15 largest market cap companies in the world. I told my team and myself: is that true? We’re not that good. Years ago everyone said eBay is better, Amazon is better and Google is better [and Alibaba is not good] and I said ‘we’re better than that’. But now we’re not that good. We’re a 15-year-old company.”

 

WalMart

Ma says Alibaba is second only to WalMart in transaction volumes but he expects transaction volumes to pass those of WalMart in 10 years, having made a bet with a visiting manager form the US retail giant.

“I said ‘In 10 years we’ll be bigger than WalMart because if you want to have 10,000 more customers you have to build a new warehouse [and other infrastructure]. For me: two power sellers.”

 

The role of women at Alibaba

“One of the secrets of our success is we have so many women,” Ma says. Today, 47% of staff are women, 33% of managers are women and 24% of senior managers.

“Women in this world, in the 21st century, you have to make sure to empower others. Women think about others more than themselves. [They think about] kids, husband and parents more than the men."

 

On the Chinese economic slowdown

“Slowing down is much better than 90% growth. China should pay attention to the quality of the economy. Just like human growth, this body can’t grow, grow, grow. But you can grow your culture, you can grow your value, you can grow your wisdom, you can grow your mind. I think China is going in that direction.”

 

On rejection

“No middle school would accept us because we were too bad. We have to get used to [rejection]. Even today we still have a lot of people reject us. For years I applied for jobs. I went for police they said no, you’re not good. Even KFC. When KFC came to my city 24 people went for the job and 23 of them were accepted - I was the only guy! When I went for the police five people went, four people were accepted. I applied for Harvard 10 times and was rejected. And now I think someday I should go and teach there!”

 

Privacy and security

“Hundreds of years ago people would rather put money under the pillows but banks know better than they do about security. In the next 10, 20 years there will be a breakthrough on that, I’m fully confident on that.”

 

On Hollywood

“I like the Hollywood innovation. I learned so much [from] the movies especially Forrest Gump. Simple. Never gives up. People think he’s dumb but he knows what he’s doing. This is the guy we should learn from. Believe what you’re doing. Love it, whether people like it or not. Life is like a box of chocolates, you never know what you’ll get. It’s not a good feeling being rejected by so many people but later we find that the world has a lot of opportunity. Hollywood gave me inspiration. A movie is the best product that can help Chinese people understand. In the [American] movies all the heroes look bad but in the end they succeed. If it was in China, everyone dies!

 

On tai chi

Ma has a tai chi trainer.

“Tai chi is a philosophy about how you balance, ying and yang. People say when I compete with eBay ‘you hate eBay’. I don’t hate eBay. Calm down, there’s always a way out and keep yourself in balance. Tai chi is like: you fight over there, I go here. Competition is fun, business is not like a battlefield: you die, I win. Even if you die, I might not win so tai chi gave me a lot of inspiration.”

 

On Alibaba today

“We wanted to make small business easier. Argentina consumers can buy from Switzerland. Internet can help small businesses sell across the nations. I hope we can serve two billion consumers. We helped American farmers in Washington state sell almost 300 tonnes of cherries to China. We helped Costco sell 300 tonnes of nuts to China.”

“We do pretty good in Russia and pretty good in Brazil. In Russia we’re number two or three in e-commerce. Two years ago [a delivery to Russia might take] four months. Now, within one week.”

 

Lessons learned

“If we can be successful 80% of young people in China can be successful. When you have $1bn that’s not your money. That’s the truth people have put in you. With the resources we have we should spend more on the young people so someday I will go back to school and tell the young people what I know. Like Forrest Gump we keep on fighting.”

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Martin Veitch

Martin Veitch is Contributing Editor for IDG Connect

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