Alibaba is a Chinese e-commerce company that has grown to be one of the world's biggest firms. It is a collection of online marketplaces that sell everything from clothing, electronics, household appliances and computers to a variety of financial products and services.
In 2014, after twelve months of planning, Alibaba went public on the U.S. Stock Market. In a news-making moment, its debut became the largest initial public offering in history. At the market's close on Sept. 14, 2014, the company had raised an astounding 21.8 billion dollars. In 2013, at $248 billion sales across its websites, Alibaba's transactions surpassed the sales of eBay and Amazon websites combined. The strength of Alibaba's performance stems from its large customer base, which numbers in the hundreds of millions. The most popular websites that the ecommerce company hosts are Taobao, Tmall and Alibaba.com, which offer users the choice of millions of businesses and merchants. Taobao is Alibaba's biggest site, and it boasts over 7 million merchants selling an enormous variety of goods and services.
Alibaba was founded by former school teacher Jack Ma, who has stepped down as CEO but still maintains quite a bit of control over the goings-on in the ecommerce company. Mr. Ma is quite passionate about being aware of and having a say in Alibaba's operations, which is why the company's initial public offering debuted on the U.S. Stock Market. Previous negotiations with the Hong Kong Stock Exchange fell through because regulators did not want a set-up where Ma and his business partners had major control over company operations. Consequently, Ma and the partners headed for the U.S. and more favorable terms on which to take their ecommerce company to the next level. The post IPO structure of the Alibaba corporation mandates that Ma and his co-founders maintain control of the publicly traded company.
One of Jack Ma's guiding principles that has helped to make Alibaba so successful is the strong determination to always put customers first. Mr. Ma outlined this belief in a letter to his employees when he filed the prospectus for the U.S. IPO. One of the ways in which Mr. Ma will be able to see this declaration through, and to maintain control of Alibaba, is the stipulation in his corporate contract that he and his partners are able to nominate more than half of Alibaba's board members.
In addition to having a large say in the makeup of the executive board, as the founder of the Alibaba ecommerce company, Jack Ma is one of China's wealthiest men, with a recorded net worth of over $10 billion.
The world is watching as Alibaba takes its place among the most successful tech corporations. Only time will tell whether this new ecommerce company has the same staying power as tech giants Apple, Microsoft and Facebook. For now, though, its prospects are looking quite good.
Photo courtesy of leighklotz at Flickr.com
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