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Eight years ago, when Alibaba co-founder Wu Yongming started his business, he didn’t stray too far from his mentor, Jack Ma.
For the investment fund he was going to set up, he picked an office in the Hangzhou Wetland Center, just a few ponds away from where Ma went to court and practiced tai chi. Wu also continued to serve as Ma’s special assistant and remained a member of Alibaba Partners, the group’s de facto board of directors.
“Jack and Eddie have a close, trustworthy relationship,” said a former Alibaba executive.
Now, nearly 20 years after founding Alibaba with Jack Ma and 16 others, Wu, 48, will preside over the dismantling of the tech empire they built. Wu will take over as chief executive in the fall, while Tsai, the group’s vice-chairman, will take over as chairman.
Alibaba believes slimming down and returning to its e-commerce roots will help it regain market share lost to emerging online platforms such as Pinduoduo and ByteDance’s Douyin. The company is spinning off other major lines of business, from food delivery to supermarkets, while e-commerce platforms Taobao and Tmall will remain the group’s main wholly-owned businesses.
“Eddie and Teacher Ma are really symbiotic,” said a longtime Alibaba employee. “Eddie admires Ma, his ideas and philosophy, and will be very good at executing his vision,” the person said.
Ma will remain with Alibaba but plans to become more deeply involved, according to people familiar with the matter. Photos of Jack Ma drinking farewell coffee with outgoing CEO Zhang Yong at Alibaba headquarters on Tuesday flooded the Chinese internet.
Ma faces the tricky task of turning Alibaba around without raising alarm bells in Beijing. Senior Communist Party officials may worry that he is trying to rekindle the political clout that sparked his downfall more than two years ago after he delivered a crusading speech in Shanghai.
“Given the 2020 presentation, it probably says a lot about Jack’s situation, he can’t really make a full comeback,” the Alibaba: The House Jack Ma Built. “It makes sense to have a surrogate,” he said.
The former Alibaba executive said Ma had no interest in returning to the day-to-day operations of the company. “Jack plays the role of the architect. What he knows best is people and how to match them together,” he says. “Jack is trying to bring Alibaba back to its roots: As the company scales, the culture gets diluted.”
After graduating from university in 1996, Wu joined Ma’s start-up China Yellow Pages as one of its first developers. “Jack Ma told me about business and his vision; I found him witty and inspiring,” Wu said later in an interview at Tsinghua University.
Soon, China Yellow Pages split, and Jack Ma took part of his team north to Beijing to operate a website for the Chinese Ministry of Trade. “We picked out the team members and Wu Yongming went with Jack,” He Yibing, co-founder of China Yellow Pages, recalled in an interview with the Financial Times.
“Wu is very hardworking,” he said. “We imported some computer workstations and servers at one point, and all the manuals were in English. His English wasn’t very good, but he delved into the manuals, checking the words in the dictionary so he could put the machines together.”
After Ma left Beijing, Wu was one of 18 co-founders who swarmed into his Hangzhou apartment in 1999 to launch his next venture, Alibaba. “He was a talented young man who believed in Jack, and Jack believed in him,” Ho said.
A few years later, Ma put him in charge of building Alimama, the advertising engine that would continue to make money for the company’s e-commerce business. His work there earned him the internal nickname “Mama Wu,” several employees said.
“Part of the nickname comes from the establishment of Alimama, but also because Mama Wu has been taking care of us, fixing bugs or new architectures,” said a former Alimama team member. “He always finds a way to solve a problem.”
“As a co-founder who is very close to Jack Ma, he always gives us the resources we need,” the person added.
Wu then created the Taobao shopping app, which quickly grew to become an important part of the daily shopping habits of Chinese consumers. After Alibaba was listed in New York, he became Ma Yun’s special assistant. For a while, he followed Ma everywhere, people close to Ma said.
In 2015, Daniel Wu resigned from Alibaba to become chairman of its health care unit while simultaneously starting Vision Plus Capital, a venture capital firm set up next to Jack Ma’s personal office in Wetlands. The group has backed several Alibaba employees to start their own businesses, such as Qiang Hui of digital health company Come-Future and Wang Jerry of Tuya. The firm currently manages more than $1 billion in assets, according to filings with the US Securities and Exchange Commission.
Wu’s investment experience will benefit the group as it transforms into a holding company that directs the profits generated by Taobao and Tmall, several Alibaba employees said.
Wu’s first task will be to turn around the platform’s decline. Ma is pushing the group to refocus on small and mid-sized Taobao sellers, rather than the big brands that dominate Tmall. Last month, he told employees that Wu Jian’s ad platform, Alimama, was key to the group’s future, according to two people with knowledge of the meeting.
“Companies keep changing their strategies, but they haven’t achieved any real results,” said an Alibaba manager. “The main problem is management. There haven’t been any really great leaders since Jack Ma,” the person said.
Additional reporting by Liu Nian in Beijing