SHANGHAI — Jack Ma, founder and chief executive officer of Alibaba, believes the company’s greatest threat is to itself.
In a 30-minute interview with British business magnate Sir Martin Sorrell at the GREAT Festival of Creativity here Monday night, Ma said: “There is no [outside] company we fear — we fear ourselves. We are too young. We are [growing] too fast.”
His words were prescient, in light of the current investigation into Alibaba’s business practices. The inquiry by Chinese regulators follows revelations from the State Administration for Industry & Commerce that the Internet conglomerate has hosted illegal business deals on its sales platform, Tmall.com.
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The company also has caught the attention of the U.S. authorities for its alleged dealings with a Chinese regulator just months after its stock market debut.
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Ma’s tone was humble, echoing previous recent public statements.
“We are big but we are not as strong as people think. We are only 15 years old and the average age [of our team] is 27. No one has experience of how to do this business because our business [was not around] before,” he said.
At the event, which is expected to generate hundreds of millions of dollars for the U.K. economy over the next five years — and attract the likes of Prince William — Ma admitted concerns for the future.
“I worry about the future. I always believe that tomorrow’s [generation] will be better, that younger is better….We worry about the competitors we never see, recognize or respect. The big guys watch each other carefully…but when we are watching each other, someone else is watching us,” he said.
On the general slowdown of China’s economy, Ma was more confident. “China should get used to 7 to 8 percent growth. We are a big nation and we should think about quality, not speed,” he said, adding that size isn’t everything, saying of his own company, “We now have more than 28,000 people, but when we had 20,000 we were more efficient.”
Although Ma downplayed Alibaba’s current dominance, the company has acquired a vast range of diverse portfolios, from smartphones to soccer clubs across China. He explained the fragmented strategy as serving a broader goal.
“We are trying to be the infrastructure of e-commerce in China. This is why we focus on [our sales platform] Taobao and logistics — we believe [they are] important for small businesses. And data, to do business without data is impossible,” Ma said.
Later, when asked what keeps him awake at night, he replied, “I worry about health and happiness of the nation.”
More immediate and opaque are Alibaba’s plans for global expansion, starting with cracking the European market.
“Fifty percent of our revenues should come from outside China. At the moment 5 percent of the business is outside. When you are big you have to learn how to take responsibility globally,” he said. “[Our] first market is Europe. Why Europe? Developed nations love developing markets. For us [developing countries] we should watch and learn. In the next 10 years, China should shift from an export-orientated to import-orientated economy. There will be [hundreds of millions of members of the] new middle classes in the next 10 to 15 years, and they need good products and services. Europe has the best quality, good health products and services….Europe needs China, and China needs Europe.
“Then, Japan and Korea — meanwhile, placing steps in India and developing nations where there are so many small businesses who need help.”
On Alibaba’s prospects in the U.S., the founder was lukewarm. “Everyone expected us to go to America…I personally think we can do a lot and help more in Europe than America. In America, people love to compete and we don’t have time to compete.”
After the talk, an excited crowd gathered to see Prince William, the first member of the British Royal family to visit China since the Queen and Prince Philip in 1986. He said: “It is not just the creative strength on display here that makes the festival worthy of its name, it is also the openness of our Chinese hosts that we will be celebrating over the next few days.
“This is my first time in China but less than 24 hours into my first visit there is a strong sense of the opportunity that exists through the collaboration between our two countries.”