Why it matters: With a $40 billion net worth Jack Ma is China’s richest man and is idolized as a business hero, so to many his retirement is a sign of a worsening business environment in China. He insists, however, that this is part of a long-term plan to allow him to transition back to being a teacher and will let him improve education across China.
With 17 other students and friends, Ma founded Alibaba out of his apartment in 1999. It’s since grown into a $420 billion giant but now Ma has revealed his plan to detach himself from the corporate structure, so he can focus on his philanthropic ventures. The move isn’t a huge surprise – 10 years ago he asked his executives what they’d do without him, and he now says he’s “very proud that Alibaba now has the structure, corporate culture, governance and system for grooming talent that allows me to step away without causing disruption.”
In 2013 he stepped back from CEO and into the executive chairman role, but he’s remained the face of Alibaba regardless. He only has a 6.4% stake in the company but maintains substantial influence due to its complex structure. In 2017, he even had a meeting with Donald Trump regarding Alibaba’s attempts to enter American markets. Alibaba was denied their request to purchase American company MoneyGram over security concerns.
“There are so many things that I want to devote my time to – education, the environment, philanthropy,” Ma said. He intends to focus on his Jack Ma Foundation, a venture dedicated to improving education in rural China. He constantly reaffirms how much he loves education, delivering public lectures on it and he’s even known as ‘Teacher Ma’ to his friends and the executives at Alibaba.
However, there have been strong concerns that his slow exit from the company is due to a worsening business environment in China. Under President Xi Jinping internet companies like Alibaba have been focused on and placed on a tighter leash. China’s economy is slowing, and debt is increasing – and that’s before the impacts of the potential trade war with the US is even accounted for.
“He’s a symbol of the health of China’s private sector and how high they fly whether he likes it or not,” the author of Ma’s bibliography Duncan Clark says. It’s more a case of not liking it “anybody who knows me knows I embrace the future,” Ma insists his gradual retirement has nothing to do with any business troubles.
Ma says he is looking forward to seeing what younger minds with fresh ideas can bring to Alibaba. I’m excited to see what changes he can make to education in China’s struggling regions. The technical details will be released on tomorrow, which also happens to be his birthday and Teacher’s Day in China.