The West has a simple narrative about Alibaba: In that telling, it’s a Chinese e-commerce giant that raised $25 billion in an IPO in New York last fall, and is a sort of eBay-Amazon-Paypal hydra. But in China, the company run by CEO Jack Ma is far more ambitious: Last year it began targeting and remaking some of the country’s most moneyed industries, from banking to entertainment. Its Internet finance arm, Yu’e Bao, looks to have the earliest impact: It offers Alipay customers higher returns than state-run banks that pay paltry interest rates, and, starved for investment options, the masses responded in droves by putting in $82 billion in the first year.
Ma made growing one’s nest egg even sexier with his next offering, Yu Le Bao, a crowdsourced film investment fund that lets ordinary folks become movie producers—with much less risk than that would normally entail. Though Yu Le Bao remains small—the first two quickly oversubscribed rounds raised less than $15 million each—the model threatens to upend traditional film financing in China.
Exactly how Alibaba might reshape entertainment remains to be seen, but the company has already assembled a constellation of services in areas including selling music, movies, gaming, blogs and set-top TV boxes, and is pursuing tie-ups with American studios. And Alibaba continues to be creative. Even before going public, it spent $804 million for a controlling stake in ChinaVision Media Group, renamed the film and television production company Alibaba Pictures, and quickly set about signing up top-notch talents like Hong Kong director Wong Kar-wai. Alibaba Pictures plans to produce 8 to 10 films a year, including high-tech blockbusters, as well as TV dramas and web-only shows. Ma says China needs “great cultural products.” He may just be the movie (and finance) mogul-in-the-making that does it.
Alibaba is so powerful, it has invented a blockbuster sales holiday: Every November 11 is “Singles Day” in China. Alibaba created it in 2009 as a sort of anti–Valentine’s Day, and last year, it resulted in more than $9 billion in sales passing through Alibaba.
[Illustration: Tavis Coburn]