Alibaba's Legendary Founder Jack Ma Stepped Down As CEO Today, Handing The Role Over To Jonathan Lu

 @SophieXSong
on May 10 2013 12:22 PM
RTR3EU65
Alibaba's new leader, Jonathan Lu. REUTERS/Stringer

It’s official: Jack Ma, founder of Alibaba, China’s e-commerce giant, is no longer its CEO. Now that Ma has exited Alibaba, leaving Jonathan Lu in charge, where will the Lu lead the company and what challenges does the new CEO face?  

Today is Taobao.com’s 10-year anniversary. China’s equivalent of eBay, which is owned by Alibaba, has just held an epic concert to celebrate the anniversary. At the concert, Ma, Alibaba’s very vocal and charismatic founder, has announced that he's officially stepping down as CEO, and that he will be replaced by Lu, who is 44. Lu has been with Alibaba for the past 13 years, and previously ran the Taobao division of Alibaba.

RTR3EU65 Jonathan Lu, Alibaba's new leader.  REUTERS/Stringer

Lu and Ma have entirely different personalities, according to 21cbh. Ma, who is 48, has been described as a “Martian” and Lu is considered more down to earth. Ma excels in innovation and idea generation, while Lu is strong in execution. They complement each other well.

Lu’s reputation within Alibaba is well-regarded: Employees consider him kind, judicious and unpretentious. Many feel he is practical and has a strong track record.

In 2004, Ma promoted Lu to head up AliPay, a Paypal-like feature that works in conjunction with Taobao. Under Lu’s leadership, AliPay achieved a 50 percent market share. In 2008, after Lu took over as Taobao’s CEO, Taobao has all but monopolized China’s C2C market space. In 2011, Lu brought Alibaba.com, Alibaba’s B2B platform, under his wing. The next year he did the same with AliYun, Alibaba’s mobile business division. Lu also became Alibaba’s chief data officer in 2012, leading the company’s efforts to become a data-sharing platform.

“Lu has taken a stab at all of Alibaba’s subsidiary companies,” an employee of Alibaba said, “usually when the subsidiary company is very new or not doing well.”

Lu is considered to be a straight shoote who's known to never play favorites, develop alliances in the company or gossip.

“He is candid," a colleague said. "If he isn’t pleased, he’ll yell, but afterwards everything is fine. He wouldn’t hold a personal grudge.”

On his way out, Ma carried out a major restructuring, bought into Sina’s Weibo -- China’s most popular microblogging site -- and put in place measures to combat counterfeit products on Taobao. In the last quarter of 2012, Alibaba became the most profitable Internet company in China. Ma is leaving Alibaba at a time when the going is good, but Lu can expect plenty of challenges.

For the longest time, there was an almost religious culture at Alibaba -- with Ma as its god, according to 21cbh. All that the employees had to do was to follow Ma’s directives. Now, many would argue, Lu must convert Alibaba into a normal, regulated company without losing its efficiency or zest. But it won’t be easy to fill the shoes of a man many regard as a legend.

“All of Alibaba’s new leaders together couldn’t match Ma’s charisma,” netizen 军都山 wrote while attending the Taobao celebration. “After Ma’s speech, even as Lu is giving his, a lot of the audience is leaving.”

After its restructuring, Alibaba has 25 divisions -- a complicated and evolving setup, to be sure. How he will manage all 25, and how the divisions will fit together will be key challenges for the new CEO.

“The current structure cannot be maintained, so what kind of final structure will the company settle on is a major task for the new CEO,” prominent IT commentator Xie Wen said.

In addition, Alibaba has been gearing up to go public, which could happen as early as this year. The task of making Alibaba look appealing now falls on Lu’s shoulders. Investors will be very interested in the company’s future direction.

“Until now, we have only gotten a general sense of Alibaba, but from an investor’s perspective, the story needs to be clearer,” Xie said. “This is another of Lu’s responsibilities.”

Fang Xingdong, the founder of China Labs, an incubator for high-tech thought leadership and innovation, believes Lu’s main priority is ensuring that Alibaba keeps growing, and growing fast.

“If Alibaba’s growth slows, it might run into some issues when going public," Fang said. "Only if it grows rapidly can there be a bright vision for the future.”

In Lu’s first speech as CEO, he said Alibaba will continue to give first priority to its customers, continue to innovate, and continue to ensure that things are executed forcefully.

Meanwhile, netizens are already missing Ma.

“Ma is so confident, in comparison Lu lacks a personal magnetism,” Weibo user 三月鸢尾 wrote.

“The highlight of the concert is the speech Ma just gave. How come there is such a difference in how well they speak?” 毛16 said.

“After listening to their speeches, it occurred to me they are just like Steve Jobs and Tim Cook. Perhaps people are always drawn to those different from them?” 蒋齐仕_软实力工场 said.

 

 

 

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