Once the richest man in China, Jack Ma’s worth has tanked by half in less than a year. The reason for the Chinese billionaire’s downfall is his rise in the first place. His company Alibaba, just a year ago, was worth more than any US company except Apple, Amazon, and Google. He is also the creator of the world’s largest fintech company Ant Group. The group operates Alipay, China’s largest digital payment platform. However, Ma’s popularity became his ultimate enemy. Several surveys indicated that the Alibaba founder was more well-known outside China than President Xi Jinping. He was also not liked by many within the Chinese government.
According to Forbes, Alibaba’s valuation in October 2020 was around $857 billion, and it was reduced to $588 billion in June 2021. Similarly, his fintech firm Ant Group was valued at $470 billion, but has now declined to just $108 billion. In essence, the valuation of both of his companies was $1326 billion in October 2020. Now it’s just $696 billion.
How the downfall started
Ma’s downfall originated with the cancellation of Ant Group’s $34.5 billion IPO that was scheduled in the second half of the last year. The initial public offering of Ant Group was estimated to be the largest in the world, surpassing even Aramco, Saudi Arabia’s oil giant. However, the Chinese government cancelled the IPO by levelling charges of irregularities in the company.
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Gradually, the values of his companies diminished, and so his own worth. Later, Ma’s hold on his companies was systematically weakened, which led to him selling his holdings in multiple subsidiaries.
Why was Jack Ma brought down
Ma’s worth has not declined due to natural market forces, but because he dared to criticise the Chinese system. Ahead of the scheduled IPO of Ant Group in November 2020, Ma targeted the Chinese bureaucracy and country’s financial regulators. He also came down heavily on the government-supported banks. This harsh viewpoint of the Chinese system didn’t go down well with the authorities who have a history of not being kind to dissenters.