Jack Ma's Original Sales Pitch in 1999


#1

In this clip from 1999, Jack Ma delivers a speech to 17 friends in his apartment to introduce Alibaba and lay out his plan to compete with U.S. internet titans. H/T to member @kevin.

Jack Ma: Today we are all here to discuss what we should do in the next 5-10 years. So, what will Alibaba become in the future? Since we were working on the China Pages, I’ve always said our competitors are not domestic websites, but overseas websites. Our competitors are not in China, but in America’s Silicon Valley.

So first, we should position Alibaba as a global website, not just a domestic website.

Second, we need to learn the hard-working spirit of Silicon Valley. If we go to work at 8am and go home at 5pm, this is not a high-tech company and Alibaba will never be successful. If we have that kind of 8am to 5pm spirit, then we should just go and do something else.

Americans are strong at hardware and systems. But on information and software, Chinese brains are just a good as theirs. All of our brains are just as good as theirs. This is the reason we dare to compete with the Americans.

If we are a good team and know what we want to do, one of us can defeat ten of them. We can beat government agencies and big famous companies because of our innovative spirit. Otherwise, what is the difference between us and them?

Everybody knows the internet is a bubble that keeps getting bigger and bigger. But when will it burst?

Yahoo’s stock will fall and eBay’s stock will rise and maybe after eBay’s stock rises, Alibaba’s stock will rise.

So don’t worry. The dream of the Internet won’t burst. We will have to pay a painful price in the next 3 to 5 years, it is the only way we can succeed.

So, the goal is Alibaba will IPO in 2002.


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#2

Great post on the importance of having a long-term vision.

I think another important point that clearly comes across from the video is how already in 1999 Jack Ma (Alibaba was not his first startup by the way) came across as a strong leader and team builder. Below are two quotes from the book Alibaba: The House That Jack Ma Built by Clark Duncan that I think highlight how Jack Ma right from the beginning of Alibaba’s set up understood the importance of creating a strong team spirit and alignment of interest, also by incentivising other “co-founders”, which appear in the video above.

“Although Jack and Cathy together were the lead shareholders, Alibaba was cofounded by a total of eighteen people, six of whom were women. None came from privileged backgrounds, prestigious universities, or famous companies. companies. This was a team of “regular people,” bound together by Jack’s energy and his unconventional management methods. To build team spirit, Jack drew on his love of Jin Yong’s novels and gave each of his Alibaba team members nicknames. His own nickname was Feng Qingyang. In Jin Yong’s book Swordsman, Feng is a reclusive sword and kung fu master, preparing young apprentices to be heroes. As a former teacher, Jack identified with Feng and his “unpredictable yet nurturing” character.”

“From the outset, Alibaba has been driven by a Silicon Valley–style work ethic, with every employee issued share options in the company, vesting over a four-year period. This is still a rarity in China, where the traditional setup in private companies was an emperor-like boss who treated employees as disposable and salaries as discretionary.”

Furthermore, Porter Erisman, former vice president of Alibaba and author of Alibaba’s World: How a Remarkable Chinese Company is Changing the Face of Global Business made an interesting comment that highlights the importance of alignment of interest with co-founders/early employees:

“The natural tendency for investors and company founders is to want to reserve stock incentives for only those in senior management positions. But starting with how he shared the equity broadly with his 17 co-founders, Jack continued to make sure that staff at all levels of the company were granted, or were at least eligible to earn through performance, stock options. In fact, when Alibaba went public in 2007, the company had to rent an arena to gather all of the staff holding stock options to walk them through the process for exercising their stock shares.”


#3

@kevin, wonderful post.

I think many investors - I was one of them once - over-weigh management’s ownership in a company a little too much. For example, if they own x% of the company or x times their salary, then management is highly aligned with shareholders. Sure, management might be aligned but that isn’t the most important part of the equation. Alignment of the whole team is crucial for attaining outstanding results.

As you pointed out leaders like Ma try to figure every way they can to create a strong team spirit. They align the whole team together to go all in. I’ve learned to weigh much more heavily a leader who can “get the air” just right for every employee. That is to align everyone in the organization to perform to their highest potential.

This is much harder to analyze, however. There are both extrinsic alignment as well as softer, intrinsic alignment. And one system might work wonderfully for one type of company and poorly for another.


#4

Alignment of the whole team is crucial for attaining outstanding results.

This reminds me of Simon Sinek’s book Leaders Eat Last: Why Some Teams Pull Together and Others Don’t. I am about half-way thru it and it is a great read. Just thought I would throw it out there in case anyone is interested in diving deeper into the subject of team alignment.