Can you ever imagine that your foreign language teacher will one day become the richest man in the country? Recently, an English teacher in China became the richest man in China. Unbelievable, but true! Jack Ma proved that entrepreneurs with a vision can do anything. In September 1995 Chinapages.com, a directory of companies, goes online and within ten years Ma grows it in one of the most successful Internet companies of China.
Now called Alibaba, it was founded in his tiny apartment in Hanzhou, China. On 19th September, Ma became the richest man in China on the heels of the biggest IPO in U.S. and possibly world history. Now you’ll probably be thinking about what IPO is and you need one quickly.
Alibaba’s success holds useful lessons for India. Taking a cue from Alibaba, Flipkart, India’s largest e-commerce company, has embarked on a pilot project to link India’s small, traditional businesses with its 22 million customers online. After raising $1 billion in fresh funding, the company launched an initiative called “FlipkartKaarigarKaDwaar” to add weavers in the north-eastern Indian city of Varanasi to its site. By connecting small businesses to the global marketplace, Indian e-commerce companies could help to breed a new entrepreneurial class and create jobs for the tens of millions entering the workforce each year.
Edited By: Priya Kumari
Now called Alibaba, it was founded in his tiny apartment in Hanzhou, China. On 19th September, Ma became the richest man in China on the heels of the biggest IPO in U.S. and possibly world history. Now you’ll probably be thinking about what IPO is and you need one quickly.
Jack Ma
What’s the whole buzz about an IPO?
According to Wikipedia, “Initial public offering (IPO) or stock market launch is a type of public offering in which shares of stock in a company usually are sold to institutional investors (that price the company receives from the institutional investors is the IPO price) that in turn sell to the general public, on a securities exchange, for the first time. Through this process, a private company transforms into a public company.” Hang on before you start freaking at the terms! IPO simply means that a company where initially only a limited number of individuals or institutions invested money in, now enjoys the luxury of going public after becoming an IPO and the money raised by the company is through shares that anybody could buy.Impact on the World
Alibaba’s IPO is like a rock falling into a pond. Instead of just creating ripples, it has created waves! It has affected a lot of companies and entrepreneurs. On one hand, inspired by Alibaba and its Indian clones, Tata Group are planning to get into the e-commerce space. On the other hand, Yahoo which invested $1bn in Alibaba in 2005 has had a significant loss in company stock value since Alibaba went public. Many believe those who had invested in Yahoo did it specifically because they owned a part of Alibaba and are now less motivated to be involved with Yahoo since they can be directly involved with Alibaba.Alibaba’s success holds useful lessons for India. Taking a cue from Alibaba, Flipkart, India’s largest e-commerce company, has embarked on a pilot project to link India’s small, traditional businesses with its 22 million customers online. After raising $1 billion in fresh funding, the company launched an initiative called “FlipkartKaarigarKaDwaar” to add weavers in the north-eastern Indian city of Varanasi to its site. By connecting small businesses to the global marketplace, Indian e-commerce companies could help to breed a new entrepreneurial class and create jobs for the tens of millions entering the workforce each year.
How assorted Alibaba is?
Talking more about Alibaba, it’s not just restricted to Alibaba.com. It consists of several other portals like Tabao.com, Tmall.com, etc. online marketplaces attract millions of shoppers. A week after its IPO, Alibaba has invested in Beijing Shiji Information Technology which is a Beijing-based company that provides hotels with technology software and services. The alliance with Beijing Shiji could help Alibaba’s travel-booking business. This shows how firmly Ma believes in diversification. He’s definitely a role model for several aspiring entrepreneurs. Most of the entrepreneurs and economists believe in the principle of multiple sources of income and Ma follows that religiously.The cons to ponder upon
Although an IPO offers many advantages, there are also significant disadvantages, the chief among those are the costs associated with the process and the requirement to disclose certain information that could prove helpful to competitors, or create difficulties with vendors.Edited By: Priya Kumari
