The billionaire has ceded control of his company but remains a powerful force
Jack Ma, China’s enigmatic multi-billionaire and owner of the global fintech company Ant Group, has dramatically stepped down from his post, bringing to an end several months of speculation about his official status and personal credibility. It is a spectacular fall from power, akin to Elon Musk actually giving up both Twitter and Tesla in order to spend more time with his family.
Ma has long been emblematic of China’s rags to riches story. Born in 1964, his family survived the Cultural Revolution, finally coming into its own in the early years of China’s capitalist transformation in the 1990s. A former English teacher, he was an early adopter of computer technology, recognising its potential as the country opened up to the world.
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In 1999, Ma founded Alibaba, an online retail platform which has grown to be a global leader in e-commerce, digital media and entertainment. He resigned as CEO in 2013 to take on the role as the firm’s executive chairman, where his eccentric visibility increased. Infamously, he dressed up and danced as Michael Jackson in front of 5,000 employees who presumably felt obliged not to tell him how toe-curlingly awful it was. At its peak in 2017, the company’s revenues were growing by more than £7 billion every quarter. His fame and confidence seemed limitless.
Via a relatively opaque series of corporate manoeuvres, after leaving Alibaba Ma became head of Ant Group, an affiliate company that includes the online and mobile payment system, Alipay, currently used by one quarter of the world’s population. Ma was scheduled to announce a £35 billion Initial Public Offering (IPO) for Ant Group in 2020 when he mysteriously disappeared.
Ma seemingly had the audacity to criticise Chinese regulators for their incompetence. After his obvious capitalist success, he became frustrated by China’s officialdom and the Party’s clear lack of enterprise. For his insolence, his IPO was halted and the company was fined £2.5 billion and told that “no shareholder, alone or jointly with other parties, will have control over Ant Group.” Ma was not seen for over three months and reappeared in 2021, “reprogrammed” to be a little more humble.
Ma’s mistake was his cockiness. His early success served the Chinese narrative promoting entrepreneurial achievement. His business acumen, and the nous of others like him, created the conditions that allowed China’s economy to out-perform most of the West. But by President Xi Jinping’s second term of office it was becoming increasingly obvious that enterprising individuals were undermining the legitimacy of the Chinese Communist Party. Initiative, wealth and the emergence of a powerful business elite calls into question the primacy of the state.
To many Party hardliners, private businesses were experimental outliers that were only tolerated until the state had learned how to do it for itself. As a result, over the last ten years the economy has shifted back from majority private companies to majority state-owned enterprises (SOE), especially within the tech sector. The Communist Party recognises that such an important, strategic sector cannot be allowed to be handled by errant, unpredictable, prancing entrepreneurs, and has mandated that SOEs should lead the country’s economic and technology catch-up. Ma, therefore, was always likely to run into trouble.
That said, maybe we need not shed too many tears for him. Ma’s 90-metre, £65 million superyacht was seen docking in Mallorca last summer and he regularly frequents his vineyards in France. He has been living in Japan, free from China’s lockdown restrictions, for the last six months. Forbes estimates that, as of January 2023, his net worth is still in excess of £20 billion. It’s safe to say that Jack Ma might have been tamed in China but, with his ambition and vast fortune, somewhere, somehow, he’ll be back.