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The Alibaba IPO
Company Background
In 2014, Alibaba was the largest online and mobile e-commerce company in the world in terms of Gross Merchandise Volume (GMV), which increased from Rmb 1.08 trillion in FY13 to Rmb1.68 trillion, a growth of about 56%. In 2014, Alibaba had more than an 80% market share in China’s online shopping market and mobile e-commerce market. This was all the more noteworthy given the fact that Alibaba’s humble beginnings. Alibaba was founded in March 1999 by 18 people, including Ma, with a collective fund of US$60,000 . The company was started at Ma’s apartment in Hangzhou in the Zhejiang provision of China. On why Alibaba was chosen as the name, Ma said, “The name (Alibaba), taken from the Arabian Nights, was chosen because it’s universally well known and is easy to spell.” In the same year, Alibaba launched Alibaba.com, a business-to-business (B2B) English language marketplace for small exporters, mainly in mainland China, to sell goods to foreign buyers. |
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In January 2000, Alibaba got an investment of US$20 million from a group led by SoftBank Corp. (SoftBank). On this investment, Ma said, “The partnership with Softbank will give us a powerful platform to expand the depth and breadth of our business and deliver further value to participants in global trade.” In May 2000, Alibaba brought in John Wu, creator of the Yahoo! Search engine, and appointed him as its Chief Technology Officer. In 2003, company started the marketplace Taobao.com, a consumer-to-consumer (C2C) market place which later became the largest shopping destination in China....
