If one were to read all the articles currently out there on the company and the debut of the IPO today, your mind might spin into a spiral of uncertainty. But as I’ve done the research on the company and the founder, I’ll opine on the basics of why I like this company and why I think, at the right price, it’s worth owing.
- Leadership Jack Ma: There are individuals in this world that can get things done and have vision and he is one of them. His hero is Forest Gump, saying the movie reminds him that “no matter whatever changed, you are you, and I’m still the guy who, 15 years ago, only earned $20 a month.” He is grounded and focused on his company’s success by providing services to customers, not just for the dollar in his pocket.
- Company’s focus: The message that Ma pitched to investors during the IPO roadshow was not one you’d normally hear: “customers first, employees second, and shareholders third”. That is not a message one would normally think investors would want to hear…being in 3rd in terms of importance. But what it tells me is, Ma is focused on the continued success of his company by continuing to satisfy those who generate the revenue for the company, the customers. If you do that, the trickle-down effect of happy returning customers is greater wealth to spread to happy employees and shareholders. He is focused on long-term growth rather than short-term gains.
- Customer base: Alibaba has a monopoly in china, owning 95% of the consumer-to-consumer (C2C) market and 50% of the business-to-consumer (B2C) market in China. They are continuing to grow through acquisitions. Their acceptance in other global markets and ability to compete with Amazon remains to be unforeseen but their home market consists of a middle class currently 350 million strong. The US total population is approximately 313 million by comparison.
The simple 1,2,3s of BABA.