by Duncan Clark
18.Zhang is the son-in-law of Gu Mu, a former key aide to Deng Xiaoping who had accompanied him on his tour of southern China, opening the door to entrepreneurs.
19.At a dinner in London in October 2015.
20.Which given anticorruption campaigns requires careful curation.
21.Xi had recently finished up a stint as party secretary of Zhejiang Province.
22.China has a reputation as a wild west for a lack of respect for intellectual property rights, justified by the rampant piracy in the market. But it isn’t due to a lack of laws. Since its accession to the World Trade Organization in 2001, China has set up an elaborate framework of trademark, patents, and copyright laws. A survey conducted in 2015 by the American Chamber of Commerce in China found that 85 percent of respondents believed China’s IPR enforcement had improved in the last five years, but 80 percent were concerned about ineffective enforcement.
23.Or selling a range of fake items on four occasions.
24.Where merchants are suspected of committing a criminal offense, Alibaba will escalate the case to the local Administration of Industry and Commerce or to the police, which has an officer stationed at Alibaba headquarters who is dedicated to tracking the sale of illicit goods, or the sale of illegal products such as guns.
25.Tmall merchants are required to furnish more evidence of their authorization to trade from brand owners.
26.Taobao’s and Tmall’s search algorithms are heavily driven by historical trading volumes.
27.Known as the “Big Four Unions,” based in Hangzhou and other locations.
28.VIP Shop, Melishuo, and Mogujie.
29.Jumei.
30.Dangdang and Amazon.cn.
31.Womai and Yihaodian, invested by Walmart.
32.19.9 percent. Suning, shelling out 14 billion yuan—$2.3 billion—became a 1.1 percent stakeholder in Alibaba.
33.Also known as Jingdong, formerly 360Buy.
34.In the run-up to JD’s IPO, Alibaba rival Tencent took a 15 percent stake and folded its own struggling e-commerce offerings into the company.
35.Wei xin (micro message) in Chinese.
36.By Andreessen Horowitz.
37.WeChat’s popularity owes much to its personalized feel, tailored to the needs and mind-sets of China’s mobile masses. But users can control the information they share with strangers, and unlike the Twitter-like Weibo the total number of followers on WeChat is capped at 5,000. Building on Weibo’s success as a home for celebrities and brands, WeChat also offers more than 8.5 million public accounts.
38.A modern twist on the traditional seasonal offerings of money to family and friends.
39.The initiative ran into headwinds in 2012 when its launch partner, the Taiwanese hardware company Acer, pulled out. This was reportedly following pressure exerted from Google, which leveled accusations that Alibaba was deploying a “noncompatible” version of Android.
40.Alibaba acquired an 18 percent stake in Sina Weibo in 2014. But by this point Weibo had lost much of its luster to WeChat.
41.UCWeb.
42.Weilidai (“a tiny bit of loan”).
43.Meaning “quickly hail a cab.”
44.Meaning “beep beep, hail a cab.”
45.Uber was next to step up to the subsidy plate, shelling out an estimated $1 billion in China in 2015 to win over drivers and customers, aided by a $1.2 billion fund-raising exercise.
46.Some foreign observers make the mistake of believing that “Shanghai is New York City and Beijing is Washington, D.C.,” but this vastly understates Beijing’s importance as a business hub—and understates the fact that local government in Shanghai is much more of a force in local business than in Beijing.
47.Even recruiting talent from Shanghai for Alibaba’s Hangzhou headquarters can be a challenge, as the office lies some distance from the city’s train station. To attract and retain Shanghai-based talent, Alibaba offers special buses to and from Shanghai each weekend to ferry employees, who stay in Hangzhou only four nights a week.
48.Describes the twin-pronged strategy comprising the “Silk Road Economic Belt,” a series of land routes from China across central Asia to the Middle East, Africa, and Europe, complemented by “The Twenty-First-Century Maritime Silk Road” to reinforce existing sea trade routes.
49.General partner.
50.Yunfeng’s name in English translates as “cloud and the cutting edge of a sword.” The combination of Jack’s first name “Yun” and David Yu’s given name “Feng.”
51.Yu first rose to prominence with the sale of his display advertising company Target Media to rival Focus Media in 2006.
52.Other partners include Shen Guojun from Intime Investment, Shi Yuzhu from gaming company Giant Interactive, Liu Yonghao of New Hope Group, Wang Yusuo from ENN Group, Jason Jiang from Focus Media, Xu Hang from Shenzhen Mindray Medical, Chen Yihong from China Dongxiang Group, Zhou Xin from e-House, Wang Jianguo from Five Star, Zhou Shaoxiong from Septwolves, Wang Xuning from Joyong Holdings, and Zhang Youcai from Unifront Holdings.
53.One example is the September 2015 announcement that Alibaba had established Alibaba Sports Group along with Yunfeng Capital and Sina (the parent of Sina Weibo, in which Alibaba is an investor) in an effort to “reshape China’s sports industry through the Internet.”
54.Cofounder David Yu, for example, also serves on the board of Alibaba-invested Huayi Brothers Media Group. His mother, Wang Yulian, is also a partner at Yunfeng and the largest shareholder in Ant Financial, after Jack and Simon Xie, holding a reported 4.6 percent stake.
55.As a General Partner.
56.As a Limited Partner.
57.The military retreat of the Red Army from 1934 to 1935.
58.As a sign of its commitment to boosting the sale of imported products in China, Alibaba branded Singles’ Day in 2015 as the “11/11 Global Shopping Festival.” Yet the company has a long way to go to secure a sufficient range of imported items to compete with the overseas sites that many Chinese shoppers have already discovered.
59.Including the mobile search player Quixey, Amazon Prime competitor Shoprunner, game developer Kabam, and mobile messaging app Tango.
60.Building on its earliest U.S. investments in e-commerce companies Auctiva and Vendio, Alibaba launched its own U.S. website, 11Main.com, in an effort to reach directly to American consumers. But the effort failed, and in June 2015 Alibaba disposed of its interest.
61.He also previously served in the George W. Bush administration, including as senior adviser on foreign affairs to Secretary of State Condoleezza Rice.
62.Deputy assistant to the president for legislative affairs, serving George W. Bush.
63.Since Alibaba donated 0.3 percent of its annual revenue to a company foundation, but the new trust is much larger.
64.Presumably to include the returns on his Yunfeng Capital investments.
65.In the northeastern city of Yabuli.
66.On social media in China, there has been intense speculation about the state of health of Jack’s own family members, but Jack has not spoken publicly about this.
67.The Communist Party runs special farms, off-limits to the public and media, to ensure high-quality food supplies for its senior leaders, who also receive privileged access to the best medical care, provided by military hospitals.
68.To Bloomberg TV’s Emily Chang in November 2015.
69.Real estate billionaire Xu Jiaxin.
70.ChinaVision.
71.3.6 billion yuan ($565 million).
72.In a deal announced in October 2015 valuing Youku at more than $5 billion.
73.Victor founded Youku after working as COO of Sohu. Youku acquired its largest competitor to become Youku-Tudou.
74.461 million people in mid-2015 according to CNNIC.
75.In 2014, the territory had been brought to a standstill by the Occupy Central movement, or Umbrella Revolution, a student-led protest against the lack of genuine democracy and other freedoms. Although the crisis ended peacefully, the underlying tensions
that fueled it remain ever present.
About the Author
DUNCAN CLARK, a former Morgan Stanley investment banker and fluent Mandarin speaker, has lived and worked in China for over twenty years. He heads a team of more than one hundred at BDA China, the investment advisory firm he founded in Beijing in 1994. An expert on China’s Internet sector, Clark is a former Visiting Scholar at Stanford University, where he welcomed Jack Ma onstage as a keynote speaker, along with the leaders of other leading Chinese Internet firms including Baidu, Sina, and Tencent.
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ALIBABA. Copyright © 2016 by Duncan Clark. All rights reserved under International and Pan-American Copyright Conventions. By payment of the required fees, you have been granted the nonexclusive, nontransferable right to access and read the text of this e-book on-screen. No part of this text may be reproduced, transmitted, downloaded, decompiled, reverse-engineered, or stored in or introduced into any information storage and retrieval system, in any form or by any means, whether electronic or mechanical, now known or hereafter invented, without the express written permission of HarperCollins e-books.
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