What are some Asian fairy tales
A Chinese fairy tale
Getting a taxi in Beijing during rush hour has been difficult for several weeks. More and more taxis are pre-booked online. The new Beijing taxi app is worthwhile for everyone involved. Customers get a discounted taxi even at peak times and drivers can better calculate their routes and thus reduce idle times. The Chinese internet company Alibaba, which is behind the app, is already breaking all records.
Since Jack Ma and his partners founded the company 15 years ago in their living room in Hangzhou in southern China, Alibaba has seen fairytale growth. In the first year, Ma secured $ 25 million in investments from well-known foreign banks, including the American investment bank Goldman Sachs and the Japanese Softbank. Unlike the western pioneers, his company was profitable after just three years. Ma is now celebrated not only as a billionaire, but also as a hero who fundamentally shaped and revolutionized the Internet and online trade in China. It is thanks to him that Chinese Internet companies have grown into the largest companies in the private sector. Ma recognized early on that Internet users know exactly what they want and he was able to benefit from the experience of the American pioneers.
In addition to Alibaba, he founded taobao.com, one of the largest online department stores for private sellers, and TMall.com, a popular platform for small business owners who can sell their products there. As an internet pioneer in China, he also laid the foundation for online payment systems and the infrastructure for logistics. He not only attracted millions of hobby sellers, but also around 58 million small and medium-sized retailers to his website. Much like Ebay and Amazon in the West, Alibaba has completely changed the way people buy and do business.
It is only logical that Ma now wants to take the next step and go public. Although neither the exact date nor the issue price are known, new speculations in the Chinese and Western media are fueling the fantasies every day.
Because one thing is clear: While the growth of Western Internet retailers is slowly reaching its limits, Alibaba is only just picking up speed. 618 million Chinese already have Internet access and also shop online: In the past fiscal year, goods worth almost $ 171 billion were sold on Alibaba's platforms - more than on Amazon and Ebay combined. And what do the numbers look like when the other half of the population is online too?
In the now planned IPO, the main aim is to collect fresh money in order to expand the product range. In addition to Alipay, a mobile payment service comparable to PayPal, even more incentives for shopping are to be set.
But even for such a model company, the Chinese government does not allow everything. Alibaba's newest product, a virtual credit card, was not licensed. The regulators found it too tricky that the creditworthiness of the customers was not checked and the security of the system could not be guaranteed. The government fears that it will lose track if payments are to be processed independently of the state banks. It is also important to the government that competitors have a chance and that there are no quasi-monopolies. They learned that quickly from developments in the West.
Weibo, a free Chinese short message service, and JD.com, number two in China's online trading, have also filed an application with the US Securities and Exchange Commission to go public in New York. So there will be a second wave of Chinese IPOs abroad. This time, however, the main beneficiaries are no longer just foreign investors, but above all China's consumers as well as Asia's financial world. Alibaba offers its users the opportunity to invest their money with high returns. And investors in Asia have long been urging their bankers to secure shares from Alibaba early. In doing so, they are driving prices so high that foreign investors are unlikely to find a bargain.
But it is also clear: Although China's Internet industry is on the advance, at least in the case of Alibaba, the West will not go completely empty-handed: the US Internet company Yahoo alone owns 24 percent of the shares in Alibaba and will earn a lot from the IPO. With this participation, however, they cannot prevent the Chinese companies from expanding in the western market soon.
Our correspondent has lived in Beijing for 20 years.
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