Alibaba! One of the largest e-commerce marketplace and online retailers in the world. Launched as an e-commerce marketplace, Alibaba Group is now involved in cloud and computing and artificial intelligence, online payment platforms, internet related services, media and entertainment, health and sports.
In 2014, the company launched a then-record-breaking IPO on the New York Stock Exchange. The company, which started operations in 1999 with only 18 employees, now has more than 120,000 employees. In 2020, the company sold more than 1 trillion worth of products through its e-commerce platform. Alibaba’s e-commerce platform currently has more than 1 billion annual active users.
History of Alibaba
Jack Ma, the founder of Alibaba Group, was born on September 10, 1964, in Hangzhou, Zhejiang Province, China. From an early age, Jack was fascinated by the English language, and as a guide to tourists in Hangzhou, He became proficient in English.
He failed the entrance exam at Hangzhou Teachers College twice in a row due to weaknesses in mathematics, but he succeeded for the third time and graduated in 1968 with a bachelor’s degree in English. After graduation, Jack began his career as an English teacher at the Hangzhou Institute of Electronics and Engineering from 1983 to 1993. In 1994, Jack founded his first company, the Hangzhou Haibo Translation Agency.
In 1995, Jack traveled to the United States with Chinese government funding and learn about the Internet. At the time, he noticed a lack of information about China on the Internet, and back in the country he started a new company called China Pages with his colleague computer teacher He Yibing. China Pages was one of the earliest Internet-based companies in China. And the company created websites for Chinese businesses.
From 1998 to 1999, Jack was the head of a Beijing-based IT Internet company under the Ministry of Foreign Trade and Economic Co-operation. Jack Ma returned to Hangzhou in 1999 and founded Alibaba with 17 friends and students.
Initially they started their journey as a marketplace of business between China based small and medium enterprises. At the time, Alibaba was charging businesses membership fees for trusted seller certificates. In October of that year, the company raised 5 million from Goldman Sachs and 20 million dollar investment from Soft Bank.
When eBay entered the Chinese market in 2003, Jack Ma launched Alibaba’s Consumer to Consumer Marketplace Taobao as a competitor to eBay. eBay in China purchased Eachnet, China’s most dominant auction player, before launching its operations. Eachnet had 2 million users in China at the time and accounted for 85 percent of the market.
At that time, Alibaba started offering all the services of Taobao for free as well as B2C services to stop the dominates of eBay and Eachnet. Alibaba also launched its own payment gateway, Alipay, in 2004. The company also launches Aliwangwang, a personal computer-based instant messenger service that allows buyers and sellers to communicate in the Taobao marketplace.
According to a 2005 article in the New York Times, Yahoo made 1 billion in cash investments in Jack Ma’s Alibaba that year and Yahoo China bought 40 percent of Alibaba’s stock in exchange for all its assets.
Rise of Alibaba
Meanwhile, by 2007, with about 100 million active shoppers per day and a total of 600 million exiting accounts, Taobao was able to overtake eBay in the Chinese market and capture 64% of the Chinese consumer e-commerce market. That same year, Alibaba raised 1.49 billion through an IPO launch on the Hong Kong Stock Exchange.
In 2008, the online retail platform Taobao Mall or Tmall was launched. Meanwhile, in 2009, Alibaba bought HiChina, China’s largest domain registration service and web hosting services company, for 79.06 million and in September, on the 10th anniversary of Alibaba, Alibaba Cloud was launched to bring the company together as a cloud computing service platform, combining e-commerce data mining, processing and customization.
In March 2010, Alibaba launched the group shopping website Juhuasuan with the Flash Sales offer and the convenience of shopping at a discounted time. That year, the company launched the online retail service Ali Express with the aim of bringing the products of Chinese small businesses to international buyers. That year, Alibaba was able to generate 978 million in revenue.
Alibaba Group went through the Major Restructuring Process in 2011 and in 2012 the company was delisted from the Hong Kong Stock Exchange. Jonathon LU became the new CEO of Alibaba when Jack Ma stepped down as CEO of the company in 2013.
How Big is Alibaba
In early 2014, Alibaba invested in Brick N Mortar Store for the first time by buying a 25 percent stake in Chinese department store chain Intime Retail. The company also bought a controlling stake in China Vision Media Group in March for 804 million, and renamed the company Alibaba Pictures Group to strengthen its position in the online entertainment and media industry.
In April, Jack Ma’s private equity farm YunFeng Capital and Alibaba Group jointly bought a 18.5 percent stake in video streaming platform Youku Tudou for 1.22 billion. In June, Alibaba bought a 50 percent stake in Guangzhou Ever Grande from Ever Grande Real Estate Group Limited for 192 million. That same month, Alibaba launched the US shopping site 11main.com with 1,000 merchants in various categories.
Later that month, Alibaba Group bought UCweb to compete with Tencent and Baidu. In September of the same year, Alibaba was listed on the New York Stock Exchange (NYSE) with a record-breaking 25 billion IPO launch. In October, Alipay was restructured and brought under the new company ANT Financial. At the end of 2014, the company’s revenue stood at 8.5 billion.
In March 2015, Alibaba Group launched a music division called Ali Music. In April, Alibaba Group began operating their B2C pharmacy Tmall Medical under Ali Health. The company also launched Alisports, a Shanghai-based sports division, the same year. In December, Alibaba bought other media assets from SCMP Group Limited, including the South China Morning Post, for 226 million. At the end of the year, the company’s revenue stood at. 12.2 billion.
In April 2016, Alibaba bought Singapore-based e-commerce Lazada for 1 billion.
Meanwhile, in 2016, Alibaba and the International Olympic Committee signed a 600 million agreement. According to the agreement, Alibaba will be the sponsor of the All Olympic Games until 2028.
In January 2018, Alibaba became the second Asian company after Tencent to cross the 500 billion valuation mark. That year, Alibaba was able to generate about. 39.9 billion in revenue.
According to a Bloomberg report in 2019, Alibaba Group was able to raise 20 billion by being listed on the Hong Kong Stock Exchange for the second time. In the same year, the company launched China-Russia flight in collaboration with the Russian Coast for fast shipping to Russia.
In September, Jack Ma officially resigned as Alibaba’s executive chairman and was replaced by Daniel Zhang. That month Alibaba’s research ARM T-Head and Damo Academy launched an AI Accelerator called Hanguang 800. Which helps to enhance Alibaba’s AI Processing capabilities. At the end of the year, the company’s revenue stood at 56.15 billion.
In 2020, Alibaba became the 31st largest public company on the Forbes Global 2000 list. The same year the company was able to achieve the World’s Sixth Largest Global Brand Valuation. Alibaba Group was also recognized as the 5th largest Artificial Intelligence Company in the same year. In 2020, the company was able to cross the milestone of 1 trillion dollar in cross-merchant transactions annually. In addition, the Alibaba Group has crossed the milestone of 1 billion active users worldwide.
According to a CNBC report in October, Ant Group, a subsidiary of Alibaba Group, is preparing to launch the world’s largest 34.5 billion IPO. That month, the Alibaba Group bought Sun Art, China’s largest hypermarket retailer, for 3.6 billion.
Meanwhile, in November, the Chinese government suspended ANT Group’s IPO launch on stock exchanges in Hong Kong and Shanghai over criticism of Jack Ma’s about Chinese banking system. The Chinese government’s Administrator for Market Regulation also started an investigation into allegations of monopolistic business practices against Alibaba Group. However, in 2020, Alibaba was able to generate about 72 billion in revenue. Alibaba set a sales record of 74.1 billion on Singles Day 2020.
In April 2021, the Chinese State Administration for Market Regulation fined Alibaba 2.6 billion for anti-competitive practices.
At present, about 123,000 employees are working in various organizations of Alibaba Group worldwide. Jack Ma’s Alibaba has always played a key role in shaping global e-commerce and the China Internet Revolution. However, Alibaba has been pursuing anti-competitive practices since the beginning to compete with other competitors in dominating China’s B2B and retail e-commerce markets. In fact, most of China’s tech giants have dominated in this way.
Recently, the Chinese government has been raising its voice against these tech giants, including Alibaba, on anti-competitive and anti-trust issues. Will Alibaba be able to maintain its dominance in such a tough policy of the Chinese government? What do you think?