Alibaba; China’s most valuable company worth more than $500 billion and the top 10 highest valuation company in the world, was founded by Jack Ma, an unexpected capital entrepreneur. From:
- carrying books in a magazine agency
- Working as an English teacher
- Creating websites for the Ministry of Foreign Trade and Economic Operation
And finally becoming Alibaba Founder; Jack Ma has been through ups and downs in life but his determination is what made Alibaba where it is today.
If you are looking to become a capital entrepreneur and raise capital for your business, learning Jack Ma’s philosophy in business is a great motivator.
Jack Ma: The Unexpected Capital Entrepreneur
One key factor behind Alibaba's current valuation is Jack Ma's exceptional ability to attract investors and raise capital.
In PIF Capital, our research showed that capital entrepreneurs who can understand and execute businesses that are sexy, bankable, and disruptive are 95% more likely to succeed in the capital market and raise substantial valuations.
Knowing this, here’s how Jack Ma implemented this philosophy into his business.
Sexy Business Model
Knowing how to tell a story is an important part of being able to raise capital.
Jack Ma is a huge fan of Jin Yong’s (real name Louis Cha) novel which inspired his idea of running Alibaba. Without Jin Yong, Alibaba would have never become what it is today. Without Jin Yong, Alibaba would never have tens of thousands of passionate entrepreneurs starting their businesses.
A business ‘xia’ serves his country and people. One should be true to his heart like the characters in The Smiling, Proud Wanderer 笑傲江湖. One should be true to his friends until death.
This philosophy emphasizes a strong focus on the customer and the human element in business operations. Alibaba's principle, as he often states it, is “Customer First, Employee Second, Shareholder Third”.
His principle in business attracted many investors and built his business credibility as a people business.
Using M&A
Before IPO, the company conducted numerous funding rounds to raise capital to USD14 billion. It also acquired a 50% stake in Guangzhou Evergrande F.C in a deal worth USD192 million and embarked on initiatives like launching a digital wallet service with CK Hutchison Holdings and a blockchain-powered cash remittance service that allow real-time cash transfers between Hong Kong and Phillippines.
In July 2020, the company officially changed its name to Ants Group, marking new levels of fast-track growth with more diversified industries.
Disruptive
In 2003, Alibaba introduced Taobao Marketplace (淘宝网), which offered a wide array of products for retail sale. Taobao quickly evolved into China's largest C2C online shopping platform and eventually became the second most visited website in the country.
In 2023, the company reported about 1.03 billion people in China were actively shopping on their mobile devices and 895 million monthly active users in the same period. With smartphone technology improving, this disruptive technology will eventually slow brick-and-mortar businesses and force them to pivot towards going digital or risk losing potential customers.
How to Succeed In The Capital Market
Understanding how to make our company sexy, bankable, and disruptive is just the beginning when it comes to raising equity from the capital market.
At PIF Capital, we fast-track SME business owners and groom them to be future capital entrepreneurs by pushing them for business networking events and meet-ups with angel investors and VCs.
If you are interested to know more, then reach out to us at PIF Capital.