Those Years When I Was Forced to Top the Forbes List

Chapter 285 Alipay's Conditions
The people at the door exchanged pleasantries.

Chen Xuebing, however, kept Ma Yun in a corner booth.

The richest man in Shanghai, the son-in-law of shipping magnate Y.K. Pao, none of that mattered to him. He believed that Shanghai Shimao would be squandered by a radical prince in the future, and Hong Kong's glory would soon fade away. He had no intention of associating with him.

Besides shorting the US subprime mortgage crisis, the second thing he wants to do today is Alipay.

Alipay is not valuable now. Most assessment agencies think it's just a transaction module that can serve as a transit point for some online merchants' transactions, nothing more.

This is his chance.

Although he has already ventured into mobile communications and is also venturing into payments, it doesn't stop him from having another payment software in his hands.

As for Taobao... it's too expensive.

Alibaba is preparing for its Hong Kong listing next year. Many institutions have received Alibaba's prospectus template. The target issue price is over HK$10, and based on their total share capital, the initial market value is expected to reach HK$400-600 billion.

It's important to note that this does not include Taobao; the listed portion only includes Alibaba's B2B business: Alibaba.com International and Alibaba.com.cn (1688.com).

The International Yellow Pages section (factories pay annual fees to promote their products overseas), and the factory-to-e-commerce distribution section (Taobao sellers obtain goods from factories for resale).

This part of the ground sales business is known internally at Alibaba as the "China Supply Iron Army," and it is also the part of Alibaba that is currently making real money, serving as a lifeline for Taobao.

As for Taobao, it currently doesn't charge any fees, its profits are meager, and it can't raise significant funds, so Jack Ma is reluctant to take it public.

This also shows that Jack Ma has extremely high expectations for Taobao.

Chen Xuebing is quite clear about Alibaba's corporate transformation process and model. After conducting some research recently, he has gained a deeper understanding and gradually realized that it would be too difficult for him to run an e-commerce platform.

Although I had considered starting my own Taobao store, my circumstances have changed.

His mobile platform urgently needs a mature e-commerce app to expand its service capabilities. Building such a medium-to-large-scale app on a system would require a team of at least 20 to 30 people working for about half a year. If he were to run his own e-commerce business and create various service platforms, it would take at least two to three years, which is simply not feasible.

Just talking about Taobao's on-the-ground promotion and logistics setup is an extremely grueling process. If he wants to profit from this part of e-commerce, he might as well rely on investment.

Moreover, even if you were to invest, there are cheaper targets—Liu Qiangdong and Huang Zheng.

Alipay's future is more valuable than Taobao's, but before it obtains a third-party payment license, no one can fully see its value.

In its previous life in 09, in order to obtain a license, Jack Ma transferred Alipay to his holding company Ant Financial for only 3.3 million yuan, citing "avoiding the influence of foreign shareholders".

After weighing the pros and cons, his best option now is to use the pre-installation terms of Taobao to acquire a stake in Alipay at a low price, obtain the most favorable benefits, and enrich his own software ecosystem at the same time.

"If you agree, I can give you the compilation tools we are developing. It should help you develop your first software as soon as possible and catch the first wave of pre-installation. Just think about it. If users can browse Taobao while lying on the sofa with their mobile phones and can directly open the Alipay app to pay, how broad will your sales scenarios be?"

Chen Xuebing tempted him in a low voice, then threatened him:
"Without our platform's cooperation, you absolutely cannot complete these tasks; you cannot even guarantee the account security verification module alone."

"I know, I know." Jack Ma nodded, holding the Kirin phone and looking at it repeatedly, thinking about how to integrate Taobao into this small phone screen.

Chen Xuebing had his eye on Alipay, and just as he had his eye on Chen Xuebing's phone at first glance.

He was the one who took the initiative to ask Chen Xuebing about the pre-installation and functionality of mobile software, but he didn't expect Chen Xuebing to directly offer him a difficult condition.

Now, he's in a bit of a bind.

Why is it so difficult to dismount from a dangerous situation?
Because eBay is not dead yet.

This young CEO, Mr. Chen, must be very aware of this situation.

If you were to find the person within a 100-kilometer radius who understands Taobao best, it would undoubtedly be this Mr. Chen. In fact, many of Taobao's suggestions were incorporated into the New Year's Day webpage version for 2005.

"Mr. Chen, how many installations can your platform achieve? If we install your platform, will no one use it?" Jack Ma asked casually.

Deep down, he desperately wanted to hear a negative answer, so he would still have a chance.

He and Ren Zhengfei had the same idea—smartphone platforms are ultimately software, and it's not like he couldn't make them.

"Installation volume?" Chen Xuebing laughed: "After today's 3G conference, I exchanged views with Vice Minister Zhang of the Ministry of Information Industry and General Manager Wang of China Mobile. We have initially determined that Singularity-Spreadtrum will lead the domestic 3G standard. Half of the hundreds of millions of mobile phones produced annually in Huaqiangbei are in our hands. Bird, Tianyu and we are fully cooperating on one-stop mobile phone solutions."

Jack Ma lowered his head and secretly swallowed.

This overwhelming force is terrifying.

He had barely seen the spark of smartphones when others had already completely monopolized the industry standards.

Software developers ultimately rely on hardware for survival.

This condition is unacceptable; otherwise, the arrival of a new internet era would be a devastating blow to Taobao.

The only thing he could do was raise the price.

"Hey? Mr. Chen!" Jack Ma said, as if struck by a sudden inspiration, "If Alipay can be installed on mobile phones, then users can..."

He moved his hand back and forth between himself and Chen Xuebing.

Actually, he had the same idea when PayPal entered the mobile payment field this year by using SMS payment. However, he felt that it wasn't very effective in the US, and it was still too early to take this step in China. His bringing it up now was a last resort.

He was conflicted; he hoped Chen Xuebing would understand the value of this, but he also hoped that Chen Xuebing wouldn't understand it as well as he did.

"You mean PayPal?" Chen Xuebing pointed out, hitting the nail on the head: "Alipay is still in a gray area, without certification from non-bank payment institutions. If you do it this way, you're just asking for trouble."

“However,” he added, “if we work together to get a payment license, PayPal’s approach will be a bit outdated. Smartphone hardware can support much more imagination.”

Chen Xuebing's words sent a chill down Ma Yun's spine.

Damn, he really knew!

He knows that so clearly. He's after Alipay!
He recalled the six-word advertisement Chen Xuebing had given him and felt that this opponent was a bit too terrifying. On his sprint track, Chen Xuebing was at least half a lap ahead of him and might have been waiting ahead to scheme against him all along.

If you absolutely must consider them as rivals...
Jack Ma felt his future was somewhat bleak.

"Mr. Chen, you don't intend to use Alipay for payments on other apps, do you? Let me make this clear beforehand, that's absolutely not allowed."

He raised his head, his gaze serious and wary.

Chen Xuebing's eyes were sincere as he patiently persuaded, "Don't worry, if I wanted to do Taobao, why would I need your Alipay? Mr. Ma, you should want me to continue investing in your Alibaba, of course, but the price can't be too high. You have to give me the price of a 'peace-loving' strategic investor."

Alibaba delisted from Hong Kong in 2012 and then listed Taobao, which was at its peak, in the United States in 2014, creating the world's largest IPO with a market value of $2300 billion on the first day. Chen Xuebing would naturally be happy to get a share of the pie.

Jack Ma straightened out the logic and breathed a sigh of relief.

"Mr. Chen, we can cooperate with Alipay, but you need to let me see the market share of your system first."

"Sure," Chen Xuebing readily agreed.

"In addition, you cannot pre-install other e-commerce software; there must be an exclusivity contract."

Chen Xuebing smiled enigmatically: "Mr. Ma, that's strange. I didn't invest in Taobao or Alibaba, so how can I exclude them?"

Jack Ma hesitated for a moment, biting his lip, and said, "I can't make this decision alone; I need to go back and talk to the shareholders."

Just as the conversation reached a crucial point, Lin Huixiang rushed over, whispering excitedly, "Dinner's ready, the big boss from Hong Kong."

Chen Xuebing frowned and waved his hand: "Wait a minute!"

The sound was a little louder, and the doorway quieted down for a moment as everyone turned to look at them.

"Oh." Lin Huixiang retreated, feeling rebuffed, and left.

Seeing this, Liu Chuan laughed loudly and greeted, "President Chen, President Ma, you two have been chatting for so long, what good deal have you reached?"

Chen Xuebing smiled and nodded at the other side, but still ignored them. He chatted with Ma Yun in the corner for a few minutes and settled the software development integration issues.

Everyone in the hall noticed that this Mr. Chen had quite a temper.

After the two finished talking, the people in the hall had already sat down at the tables to chat.

"Mr. Chen, please have a seat." Guo Guangchang greeted him with a smile, "You sit with the girl from Shanghai University of Finance and Economics."

Chen Xuebing noticed that a serving spot near the door had been reserved for him and Jack Ma, which seemed like a form of "punishment" for them. He didn't pay much attention to it, and simply pointed to the restroom, indicating that he needed to use the toilet.

He had been holding back for quite a while to discuss these two matters.

When Chen Xuebing returned, the hall was completely quiet.

Everyone listened attentively to Wu Guangzheng, who was sitting in the main seat, as he spoke.

"Back then, the four major trading houses in Hong Kong, Jardine Matheson, Hutchison Whampoa, Swire, and Wheelock, were all old-fashioned British capital and looked down on us Chinese merchants."

“In the 70s, my father felt that the shipping business was not doing well and planned to go ashore. We planned to acquire Wharf Holdings. At that time, Wharf Holdings was worth 13 billion HKD and had more than 50 billion HKD worth of land in its hands, including warehouses, hotels, buildings, trams, and piers in Tsim Sha Tsui and the New Territories.”

"We acquired a lot of Wharf Holdings shares."

“Li Sheng was very smart. He had been acquiring Wharf Holdings shares for a long time and had acquired 18% of the shares, pushing the share price from over ten dollars to forty dollars. However, at that time, Jardine Matheson controlled Wharf Holdings. He couldn’t take the shares even if he wasn’t allowed to, so he took the initiative to approach my father.”

“None of us expected that he would sell all the shares he acquired in Wharf Holdings to us at a price 10 HKD per share lower than the market price. So my father helped him find HSBC's tycoon, Sir Michael Sandberg, who sold him 9000 million shares of Hutchison Whampoa at half price and provided him with a loan to support his acquisition of Hutchison Whampoa.”

“We acquired Wharf Holdings and Wheelock Properties from Jardine Matheson. He, on the other hand, used Cheung Kong Holdings, with a market value of 7 million HKD, to acquire a 22% stake in Hutchison Whampoa, with a market value of 62 billion HKD, becoming the largest shareholder and acquiring the first port, Hong Kong International Container Terminals.”

"Then the business grew big. The main port business was supported by Hutchison Whampoa. Hutchison Whampoa made three to four hundred billion a year in ports, electric companies, oil, and retail Watsons. Its Cheung Kong Holdings also did real estate."

"We've taken over two foreign firms, but we can't compete with Mr. Li in business anymore."

"Sometimes people really do have a destiny."

(End of this chapter)