Jack Ma, the charismatic co-founder of China’s largest e-commerce firm Alibaba Group Holding Ltd, will step down as chairman in one year to concentrate on philanthropy and education, passing on the reins to trusted lieutenant Daniel Zhang.
Ma, who turned 54 on Monday, has long flagged plans to step back, insisting that Alibaba management should be relatively young and his retirement is not expected to affect the running of the company.
But it is still extremely rare for a founder of big and transformative tech firm, especially one with a cult-like status like Ma, to retire so early.
‘There’s only Bill Gates who has done the same. No other tech founder in the world has just resigned like that at the top,’ said Rupert Hoogewerf, Shanghai-based founder of the Hurun Report, which publishes an annual influential list of China’s richest people.
Hoogewerf added that in China, Ma was a figure like no other, with friends ranging from movie stars to billionaire moguls, though he often outshone them all. ‘He’s the big one, he’s the one that brings them together.’
Ma will give up the chairman role in exactly one year on September 10, 2019 and complete his current term on Alibaba’s board of directors following the company’s annual general meeting in 2020, the company said. He relinquished the role of chief executive in 2013.
Zhang, 46, has been CEO since 2015 after serving as chief operating officer and is known as a key architect of Alibaba’s ‘Singles Day’, the November 11 event that has become the world’s largest online shopping event. Zhang, a former accountant, will also continue as CEO.
‘Under his stewardship, Alibaba has seen consistent and sustainable growth for 13 consecutive quarters... Starting the process of passing the Alibaba torch to Daniel and his team is the right decision at the right time,’ Ma said in a letter released by the company.
Ma, a former English teacher with no technical background, co-founded Alibaba in 1999 with 17 others and has become one of China’s richest people with a net worth of $36.6 billion, according to Forbes.
The company, founded at a time when the industry was still dominated by state-owned firms and entrepreneurship was seen as a risky career path, has grown to have more than 66,000 full-time employees and a market value of some $420 billion.
‘He put a human face on technology, and took China onto the global stage, not as a state-owned enterprise, crucially,’ said Duncan Clark, managing director at Beijing tech advisory BDA and author f ‘Alibaba: The House that Jack Built.’
In the letter on Monday, Ma said he had been planning his exit for ten years and has previously said he wants the company to last 102 years, choosing a specific number to motivate employees.
After he steps down, he will continue to mentor management as part of the ‘Alibaba Partnership’, a 36-member group of core company managers.
The group has the ability to nominate the majority of directors on the company’s board, and currently five of Alibaba’s eleven board members have been nominated by the partnership.
Last year Ma invested 300 million yuan ($45 million) in a rural education project in China. He has also established a scholarship program in Newcastle, Australia.
Ma, who owns roughly 6 per cent of Alibaba’s stock and also controls Ant Financial, is stepping back amid more challenging times for Chinese tech companies as sales growth in China’s eastern mega-cities shows signs of slowing.
Alibaba saw sales at its e-commerce business swell 61 per cent in the latest reported quarter, but its profit margins have been squeezed by big-ticket investments as it battles to maintain its dominant position in e-commerce and payments.
Alibaba also has investments in sports content, microchips and facial recognition technology and has been positioning itself as a serious player in cloud computing.