HONG KONG — The mammoth IPO planned by e-commerce giant Alibaba Group highlights founder Jack Ma's improbable rise to China's entrepreneur-in-chief.
Ma, a former English teacher who flunked his college entrance exam twice, founded Alibaba in his apartment in 1999 with 17 friends and $60,000 they had raised. Charismatic by the gray standards of Chinese CEOs, the impish Ma has cult status in China, where he's seen as the equivalent of Steve Jobs, Jeff Bezos or Bill Gates.
In a country where state-owned enterprises dominate business and many owe their wealth to Communist Party ties, Ma stands out for his huge self-made success. Alibaba, which started as a site to link Chinese manufacturers with buyers overseas, became under Ma an e-commerce behemoth that is now expanding into banking, digital maps and online video.
The paperwork for Alibaba's initial public offering says it will raise at least $1 billion from the U.S. listing, but finance professionals believe that is a conservative notional figure to get the process rolling. Estimates for the amount that could be raised have ranged from $10 billion to $20 billion. The price at which shares are sold might give Alibaba a market valuation as high as $200 billion, which would be greater than Facebook's.
Ma, who owns 8.9 percent of the company, is likely to become even wealthier. He's already worth $8.4 billion, making him China's fifth-richest person, Forbes says.
Ma, 49, stepped down as CEO last year, saying in a letter to employees that he was "no longer young for the Internet business." He remains chairman and an important figurehead for the company's 21,000 employees, though he now focuses on philanthropy and recently established a charitable trust potentially worth billions.
"It would be hard to find a private citizen in China who's had such a big impact on the economy," said Porter Erisman, maker of a documentary about Alibaba and the company's former marketing vice president. "I look at him as the pied piper of entrepreneurs in China. He created this platform; he pushed China online."
The seeds for Alibaba were planted with China Pages, founded by Ma in 1995 with $2,400 scraped together from relatives. It created websites for local businesses, starting with a translation firm. He partnered with a state-owned enterprise, but the venture stumbled after a falling out.
He worked briefly at an e-commerce venture in Beijing backed by the Ministry of Foreign Trade and Economic Cooperation but left because of the lack of dynamism. He went to Hangzhou to set up Alibaba, a business-to-business website that linked China's countless exporters with buyers around the world. He picked the company's name because of the universal appeal of the Arabian Nights story and the associated catchphrase "Open Sesame."
The company launched retail website Taobao in 2003 to compete with eBay in China. Ma was unfazed about going up against the U.S. giant, famously saying, "Ebay is a shark in the ocean. We are a crocodile in the Yangtze River. If we fight in the ocean, we will lose. But if we fight in the river, we will win." Ebay shuttered its China site in 2006, a major victory for Ma.