According to the news report by Bloomberg, Jack Ma, China’s richest man, is leaving Alibaba. He will step down from the post of Executive Chairman of Alibaba Group Holding Ltd. next year – in 2019. The reins of the company will be handed over to Daniel Zhang, who has been the Chief Executive Officer of the company for just three years now.
Jack Ma stated that he was going to use his time and his $40 billion fortune to focus on philanthropy and education and plans to return to teaching. The announcement of his succession plan coincided with his 54th birthday.
Jack Ma, along with 17 others, founded Alibaba back in 1999, however, it was he who made this company the powerhouse it is today. This former English teacher was able to run eBay out of China and pushed Amazon.com, the retail giant that has turned the Western retail industry on its head, to the position of “also ran”. He was also able to create a payments service that has now become the $150 billion online financial giant Ant Financial.
Today, Ma has become the face not just of his own company Alibaba, but also of the Chinese technology industry.
Daniel Zhang, the man to take over from Ma, is a 46-year-old certified accountant who has proven to be a capable leader. He has designed and pull-off with great success mega events like the Singles’ Day shopping festival. Since he took over as Chief Executive Officer of Alibaba, the company’s stocks have grown by 87% and the tech giant now has a market capitalization of around $420 billion, beating its competitor the WeChat operator and owner, Tencent Holdings Ltd.
Since Zhang took over as CEO, the company has seen 9 consecutive quarters of revenue growth at above 50%. Zhang is also the man who has overseen the growth of the company’s retail platform Tmall and has turned it into one of the biggest revenue generators for the company.
Ma has been the flamboyant technology visionary for the company, however, Zhang is known more as a financial wizard who stays under the radar. And Zhang’s appointment as the new executive chairman of the company is ironic, since Ma had often stated that he did not like professional “managers” as they had a tendency to focus on the short term performance of a company.
The biggest challenge that Zhang is going to face is how to grow this Chinese giant in international markets. The company has been significant inroads into the Asian markets, but still remains relatively unknown in the West.
Zhang, unlike Ma, is very quiet. In fact, according to Duncan Clark, the managing director of Beijing’s tech advisory BDA, and the writer of the book, “Alibaba: The House that Jack Built”, not much is known about Daniel Zhang, despite the fact that he has been the CEO of Alibaba for some time now. A soft-spoken accountant, Zhang may now have to step out of the shadows so that he can lead the company better.
Additionally, despite the fact that Alibaba’s sales are soaring, the company’s profit margins are getting cut down due to increasing competition in the sector as well as the company’s own heavy investments as it tries to stay ahead of the competition. Thanks to this, Alibaba’s shares have dropped by about 10% for the year so far.
Not everyone is happy about the fact that Ma is stepping down from the helm of the company. According to Business Insider, the share prices of the company fell by 1.7% during trading on Monday after the news broke that he was stepping down as executive chairman of the company.