How I created e-commerce in China
company in 1995, after I visited Seattle. China was not connected to the internet, and nobody believed there was this network. So it was difficult to even hire people. The first three people were me, my wife, and a guy who was a university lecturer with me, who had a computer background. China was starting to think about exporting, but small businesses couldn’t go to international trade shows. So our business model was to make homepages for Chinese companies, so they could promote their products and be found by international customers.
Nobody wanted to try it. But I had a friend, Maggie Zhou, who later became my secretary and now is our ambassador to Australia. She worked for a hotel called the Wanghu [Lakeview], the first four-star hotel in Hangzhou. I told her manager that I could make the hotel a free homepage, “and if there are any people who come to your hotel through that homepage, you can pay me.” He agreed. And nothing happened for three months.
Then the Fourth World Conference on Women was held in Beijing. Suddenly the hotel got a fax from several American ladies. They were coming to the conference and using the internet to search for hotels—and the only one listed in China was the Wanghu Hotel. We had to tell them that the hotel was more than 1,000 kilometers from Beijing. But they asked, “Can we stay in that hotel and have meetings?” After the conference, they flew to Hangzhou to stay for three days. That shocked the general manager of the hotel—and then he paid us.
Even today, I still don’t know how to code. I really don’t understand how to compute. But as an entrepreneur, if you don’t know something, you don’t have to worry—you just have to find people who know about it. I didn’t know anything about financing until I found Joseph Tsai, Alibaba’s executive vice chairman. I don’t talk to the investors a lot, because Joe’s supposed to do that.
Don’t try to hire the best people at first. If you try to hire the best when you’re still a small company, it’s like putting a Boeing 747 engine into a poor tractor. It won’t work. But you can hire the right people, the people who know better than you, who are passionate about what they do, and who are open-minded about learning. And then when your company gets bigger, you have to rotate your people through different jobs. Make sure the engineers know about more than engineering. Work with the entire staff to make sure they are the best in their field. I have a great team, because they get everything done better than I could. So I can spend a lot of time thinking about the future.
The perception is that online, counterfeiting is big. But I would say, today, it’s so much better than offline. With internet commerce, everything you buy, sell, deliver, manufacture—we can trace all the data. We’re using our technology to fight against phony merchandise. In China, we deliver up to 57 million packages per day, and we had $547 billion in sales on our platforms last year. If people buy something counterfeit, that makes them unhappy and it makes the brand owner unhappy and unwilling to partner with us. But we’re getting more and more brands to partner with us. This year, we’re launching a huge campaign and working with law enforcement to fight against manufacturers that produce counterfeit products, to stop that at the root.
We are the company dealing with 10 million small businesses in China alone. We can at least figure out who’s buying, who’s selling, who’s manufacturing. It is why we are chasing the bad actors. It’s impossible to kill them.
Business is all about five, 10 years later. That’s why I have to travel, I have to listen, and I have to think a lot of things that might seem crazy. All small businesses should think out of their town, out of their city, out of their country. If you’re a real entrepreneur, there is always curiosity. If you don’t have curiosity, you’re a retired entrepreneur.
Alibaba’s existed for 18 years, and we are so influential in China, but nobody in America knows us. We’ve always tried to come to America. We’re not very successful, but we have patience. Now we say, “We do not want to make another Amazon, another eBay here—but we can make the small businesses go to China.” I’m not really that keen on making every American know about Alibaba, but I’m very keen on getting entrepreneurs to try Alibaba. We’re not an e-commerce company—we make other people do e-commerce. We think every company should be e-commerce.
If Amazon can help you, go on using Amazon. If eBay can help you, go on using eBay. What I’m telling everybody is, we should not globalize the Alibaba business. We should globalize e-commerce.
Jack Ma built one of the world’s biggest internet companies without learning how to code. The lead founder and executive chairman of Alibaba taught himself English by offering tours to foreign visitors of his hometown, Hangzhou, in eastern China. That’s where, in 1999, Ma launched Alibaba, which took in nearly $23 billion last year. Now Ma is hoping to expand his U.S. business, especially by encouraging more American companies to sell their goods on Alibaba’s platforms. –As told to Maria Aspan