In 1995, a young Chinese translator travelled to Malibu with a brief to persuade an American to pay his debts to an aggrieved Far Eastern business partner. Things did not go well. The American pulled a gun on the 5ft tall Chinese man and locked him up in a beach hut for two days. The translator finally managed to talk his way out of captivity by promising the American that they would start an internet company together.
The irony is that the translator did not even know what the internet was. He does now. The prisoner of Malibu has become China’s richest man, and it is the internet that has elevated Jack Ma, 50, to that summit of prosperity. In the wake of that traumatic trip to the United States, Ma researched the internet and realised the awesome commercial potential of the web in the fast-growing Chinese economy. In 1999, he and a group of colleagues pooled their $60,000 savings and established Alibaba, an online marketplace connecting small Chinese firms with foreign buyers. Alibaba earned its money by taking a commission from each transaction, no matter how small.
Growth over the past 15 years has been explosive. Today, Alibaba has expanded and diversified into an e-commerce leviathan, offering a vast array of services ranging from peer-to-peer online trading to facilitating electronic payments. On a single day last year, the company hosted $5.75bn worth of transactions. In the world’s second largest economy Alibaba has an 80 per cent share of an e-commerce market that is still growing fast. Last month, the owners cashed in. Alibaba group raised $25bn in equity on the New York Stock Exchange in the largest single stock market fundraising drive in history. The total company has a valuation of about $250bn.
Going public catapulted Ma, who controls a 6 per cent stake in the company, into the constellation of global super wealth. The American magazine Forbes this week estimated Ma’s personal wealth at $19.5bn, making him the richest individual in China and placing him at 36th on the global rich list. And unlike many on that list, Ma started out with almost nothing. Ma Yun was born in the city of Hangzhou in 1964, a few years before Chairman Mao turned the country upside down with his barbaric Cultural Revolution. Ma’s family suffered. His parents were practitioners of a local musical performance art called pingtan, which, along with most other traditional art forms, was banned in those years of intolerance and brutality.
A friend from those years recalls that Ma was passionate about cricket fighting, developing an expert ear for the sounds made by various species of the insect. Ma did not do well at school. He failed the national college entrance exams twice. But he persevered with learning English, eventually entering a teacher training college in Hangzhou. He practised his communication skills on the Western tourists who were beginning to trickle into the country after Mao’s death in 1976. After taking a low-paid job teaching English, Ma set up his own a translation agency, which is what took him to Malibu.
