Financial News

  • 7 May 2014, 19:35

The £140bn Web Giant Unknown By Most In West

It's the tech company whose founder doesn't really like technology - a $245bn (£144.3bn) e-commerce giant that doesn't actually sell anything.

Now, though, Alibaba†has filed for an initial public offering (IPO) in New York - potentially the biggest in history, even topping Facebook's†$16bn (£9.4bn) flotation two years ago.

So what's the story behind the biggest company you've never heard of?

Alibaba is China's e-commerce giant - equivalent to an amalgam of Amazon and eBay.

It does not sell its own goods directly but works as a marketplace for more or less anything.

You can buy everything from lawn mowers to Prada handbags.

Categories include agriculture, automobiles, chemicals, electronics, food, minerals and mechanical parts.

The company operates mainly in China, which is why few people in Britain have heard of it.

But because there are so many internet users (and keen shoppers), Alibaba is huge.

Last year, nearly 231 million users traded £146bn worth of goods through the platform - more than Amazon and eBay put together.

Alibaba's cut meant revenues of £3.8bn for the company and a profit of £1.84bn.

Compare that with Amazon, which made £44bn in revenue but only £161m in profit.

CEO Jack Ma, a former English teacher who was rejected by Harvard 10 times, founded Alibaba in 1999 but says he does not spend much time online.

Instead he gets an assistant to download movies for him to watch on his iPad†and says he prefers Tai Chi and traditional medicine.

He told a crowd at Stanford University last year: "That you don't know about technology, doesn't mean you don't respect technology."

It has certainly not held him back. In the filing, Alibaba said it "will be a company that lasts at least 102 years".

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