Chapter 7 Chapter 6 Six Meridians Excalibur, Business Philosophy of Great Wisdom Ruoyu

The Six Meridians Excalibur is the kung fu in Jin Yong's novels, and it is the unique skill of the Duan family in Dali.This sword technique includes six parts: Shaoshang Sword, Shangyang Sword, Zhongchong Sword, Guan Chong Sword, Shaoze Sword, and Shaochong Sword.Although the Six Meridians Excalibur is ever-changing and has different moves, it is also connected in one vein and has the same connotation.This requires martial arts practitioners to be open-minded and open-minded, so that they can lift weights like light and move forward and retreat freely. Whether it is Ma Yun's business wisdom or sense of competition, whether it is his management philosophy or entrepreneurial persistence, they all come from the deepest business philosophy in his heart.He is very wise and foolish, and when he is willing to give up, he can show his grandeur and calmness. He is quite a master who has practiced the "Six Meridians Excalibur" to the level of proficiency.

"Shaoshang Sword" is connected with the thumb of the right hand and belongs to the lung meridian of Taiyin.Ma Yun believes that the greatest wealth is that he has experienced many failures. He pays more attention to the process than the result of the harvest.This requires a light hearted attitude.This is like practicing the Shaoshang sword, Shi Potian is shocked and fearless in the face of danger, and he is still calm when the storm is approaching. All the influential figures are very bright on the surface, but behind each of them there are many sufferings that are not known to outsiders.Failure is the mother of success. Although the saying is old, the truth remains the same.Especially in the brand-new industry of the Internet, trial and error is even the only way to develop.Jack Ma and Alibaba are of course no exception.

In the course of its development, Alibaba encountered a very serious dilemma.Alibaba initially relied on venture capital, which was purely burning money without any profit model.When it develops to a certain stage, whether it can make a profit has become the key to its life and death.In order to develop a successful profit model, Alibaba has successively launched 6 kinds of products, with repeated defeats and repeated defeats, until finally succeeding. At the beginning of Alibaba's business, it first tried online advertising, but it was terminated within a year; then it was online hotel reservations. In 2000, Alibaba wanted to cooperate with Ctrip. It turned out that the development directions of the two companies were too different, so they had to Don't give up; continue to do tradelink, hosting, and system integration. Every time, I want to work hard to make a profit for Alibaba, but every time I fail without exception.

But Ma Yun was not discouraged, and finally found two main products in October 2000 that not only conformed to the company's development direction but also achieved profitability - Chinese suppliers and Chengxintong. Ma Yun once said that he would write a book to reflect the mistakes Alibaba had made.Of course, he didn't want to show off his strength or luck, but just to tell the latecomers that failure is commonplace on the way to success.For Alibaba, Ma Yun does not talk about the word "success", because Ma Yun has always emphasized that he must be a 102-year-old enterprise.The Internet is a new thing, and every Internet company is facing countless unknowns, and they are crossing the river by feeling the stones.In this sense, every company makes many mistakes and even repeats the mistakes of its opponents.Making mistakes doesn't mean you're inferior.

Alibaba's acquisition of Yahoo China is undoubtedly a big deal.Ma Yun likes Yahoo, of course because Yahoo has the most powerful technology in the world, but more importantly, the experience accumulated by Yahoo in China for 7 years, whether it is the mistakes it makes or the progress it has made, is of great importance. It is a reference for Alibaba's future development. After Alibaba acquired Yahoo China, Jack Ma asked Yahoo China to abandon its previous portal image and return to the search field in an all-round way.Ma Yun's instruction to his subordinates is "When Yahoo China is not like Yahoo America, it will succeed."Ma Yun did this, on the one hand, because he wanted to obtain a search engine from the very beginning to improve Alibaba's e-commerce; Find a way out for Yahoo.

But things are not that simple. Less than half a year later, the homepage of Yahoo China has returned to the original portal style.Shortly thereafter, the changed Yahoo China search box reappeared on the home page.But this time, the domain name www.yahoo.cn is used, and the home page www.yahoo.com.cn in the form of a portal coexists with it.Anyone with a discerning eye will definitely find that Jack Ma's road to Yahoo China is very difficult.After several tosses, Yahoo China has yet to find a good direction.Ma Yun is still moving forward through trial and error. We will wait and see what the future of Yahoo China will be like.

Ma Yun's self-confidence comes from his experience of too many failures and ups and downs.It is these mistakes that have made Ma Yun and Alibaba gradually mature.Having experienced many failures is Alibaba's greatest wealth, and Alibaba will definitely be able to write new myths again. "Shangyang Sword" is connected to the index finger of the right hand and belongs to the Sun Small Intestine Meridian. It is characterized by ingenuity, flexibility and elusiveness.Ma Yun is very elusive.In the eyes of ordinary people, it is easy to spend money and difficult to earn money, so spending other people's money is naturally a dream.Even if you accept financing from investors, there is no need to feel extremely painful, just spend money with peace of mind and do things in a down-to-earth manner.What's more, in the Internet industry, the comparison is to burn money, just spend it.However, Ma Yun thinks that spending other people's money is more painful than spending his own money. This is somewhat elusive. I don't know how lethal his "Shang Yang Sword" is.

One big difference between the Internet economy and the real economy is that the Internet economy is very dependent on venture capital, so most Internet companies regard investors as their parents.And Ma Yun’s words are amazing. In 1999, when Alibaba started financing, he said to investors: “You are very important, but you are only Alibaba’s uncles, and customers are Alibaba’s parents.” Having said that, Ma Yun treats investment The latter is not ambiguous at all, especially when spending money.That's why he's particularly popular with investors. In 2000, Ma Yun and Sun Zhengyi reached an agreement, and the latter invested 20 million US dollars to help Alibaba expand its global business.After agreeing to 20 million, Sun Zhengyi put 30 million US dollars into Alibaba's account, because he is very optimistic about Jack Ma and his team.It should be a good thing to have an extra investment of 10 million yuan, but Ma Yun regretted that he had too much money.He told Sun Zhengyi's assistant that only 20 million yuan was needed. The assistant thought that Ma Yun was sick and firmly refused to return it.Therefore, Ma Yun sent an e-mail to Sun Zhengyi: "I hope to join hands with Mr. Sun Zhengyi to explore the Internet... If there is no fate to cooperate, then we will still be very good friends." Sun Zhengyi agreed to return 10 million US dollars.

Afterwards, Ma Yun said to people: "Having money is not a good thing, you have to know how to use the money." From this incident, it can be seen that Ma Yun treats investment very carefully. Jack Ma, who holds a huge sum of US$20 million, is still as stingy and stingy as before.The salaries of the employees were still kept very low, and only 200,000 yuan was advertised in two newspapers.Ma Yun said: "Be very careful when spending investors' money, and be responsible to investors." He did not use the money raised to improve employee treatment and company conditions, but for the long-term development of the company.

Paying will eventually pay off, and investors are for the rewards.What investors need most is not for the operator to save money for him, but to make money for him.Internet companies lose money at the beginning, and the reason why investors enter is because they are optimistic about its potential to make money in the future.Since 2002, Ma Yun has proved to investors that Alibaba has made money, which is the best gift for venture capitalists. Alibaba achieved a profit of 6 million yuan in 2002. In 2003, its daily operating income exceeded one million yuan. Since then, its profit and income have grown steadily every year.Its earnings reports have never disappointed investors in a single quarter.From 2003 to 2004, Alibaba raised more than 80 million US dollars, and the smoothness of financing corresponds to its performance level.

In the long run, Alibaba investors are betting right.Take Sun Zhengyi as an example. In 2005, he gave up 4.5 million Taobao shares and cashed out 350 million U.S. dollars. He made a lot of money.Venture capitalists who invested in Alibaba have achieved huge returns. In the Internet industry, many people fail because they are too rich.I got a large amount of venture capital, but I couldn't arrange the expenditure reasonably. As a result, I finally made a mistake and couldn't make up for it.And Alibaba had no money at the beginning. It started with 500,000 yuan, and every penny had to be carefully calculated.In this way, a good habit has been developed, and when a large amount of venture capital is obtained later, the money is still spent as before.Ma Yun always considers that he must be responsible for investors. He knows that spending other people's money is more painful than spending his own money, so Alibaba works hard to do everything well.This attitude towards investment is undoubtedly the most important. Jack Ma, who has always spent his own money, knows how to spend money better after getting investment.Jack Ma feels that spending other people’s money will be painful. Perhaps the reason is that the purpose of financing is not to learn how to spend money, but to learn how to spend money to do things in order to return investors. "Zhongchong Sword" is connected to the middle finger of the right hand and belongs to the Yangming Stomach Meridian.To reach this level, one must devote oneself to cultivation and have deep inner strength.Ma Yun's business philosophy has the essence of Taoism, emphasizing what to do and what not to do. He always keeps a clear mind, a broad mind, and is capable of doing a job with ease.To reach such a state, one needs to practice the "Zhong Chong Sword" and have the momentum of opening and closing. In 2004, with the success of the three major web portals on NASDAQ, the listing of Ctrip, and Baidu, e-Long and other well-known Internet companies announced plans to go public one after another, e-commerce seemed to have begun a comprehensive recovery.However, amidst the excitement and cheers, Jack Ma unexpectedly said: "I don't want to go public at the moment." In fact, Jack Ma doesn't want to go public.As early as 1999, when Alibaba was founded, Jack Ma said at a staff meeting that Alibaba would rush to NASDAQ within three years, but later he became more calm and rational about going public. Ma Yun's most common explanation for not going public is that Alibaba is not short of money.At the beginning of Alibaba’s establishment, it attracted a total of 25 million US dollars of private equity funds from investors such as Softbank, Goldman Sachs Group, and Japan Asia Investment Corporation. Ma Yun once told "IT Times Weekly": "To be precise, what we need is not venture capital, not a gambler, but a strategic investment partner. They should have long-term confidence in me. This kind of quick entry and quick exit, I dare not take the investment of speculators who want to cash out their profits after two or three years." Alibaba, which is not short of money, is more eager for long-term strategic investment.Alibaba relied on private equity at the beginning, because private equity is based on a kind of trust first, and the relationship between the two parties will not be broken due to some differences. Buried in the headache of making money. Although Alibaba seems to have the conditions, capabilities and strength to go public, there has been no movement for a long time. Why?In this regard, Ma Yun said: "Alibaba does not want to go public now. We are too young. The company has only been established for 4 years, and the average age of employees is only 27 years old. The internal strength is not good enough, so although we have the strength to go public, we will not go public in the short term. the plan of." Like Ma Yun, the CEOs of almost all listed companies are faced with the performance of the next quarter and the next quarter.Sometimes, maybe just because of the performance of two quarters, they have to give up the long-term investment that must be done after 3 years. If you don’t go public, you don’t need to face 5,000 shareholders telling you what to do, but you only need to convince the 5 most caring shareholders to stand firmly on your side and make long-term plans.Ma Yun does not go public for the sake of going public. Compared with going public, the most important thing is to make the company well and strong. In 2005, Alibaba's acquisition of Yahoo China once again aroused people's associations.Some people speculate that the purpose of Ma Yun's acquisition of Yahoo China is to go public.In this regard, Ma Yun once again gave a negative answer.Although Alibaba has obtained both technical and economic support from Yahoo China, the time for Alibaba to go public is not yet ripe. Of course, Jack Ma is not blindly rejecting listing, he is just choosing the right time.With the steady development of Alibaba step by step, the market share is getting bigger and bigger, and Taobao and Alipay are also growing up healthily.Moreover, it was expected that the global capital market would be booming for a period of time around the 2008 Olympic Games, so Alibaba was finally listed on the Hong Kong Stock Exchange on November 6, 2007. Alibaba's listing created a shock wave and set a series of records.But until this time, Ma Yun did not show a little arrogance and excitement, but was quite peaceful.In his view, listing is just a gas station, the purpose is to go further.The greatest significance of Alibaba's listing is that it has obtained an opportunity for continuous financing and established an interactive mechanism for sharing returns with investors. Ma Yun's "Zhong Chong Sword" expresses a kind of inaction thought.Lao Tzu's thought of doing nothing does not mean doing nothing, but contains the meaning of not acting recklessly, not acting indiscriminately, conforming to the objective situation, and following the laws of nature.Ma Yun's business philosophy is in line with it. "Guan Chongjian" is connected to the ring finger of the right hand and belongs to the Shaoyang Sanjiao Jing. It is characterized by simplicity and simplicity, seemingly clumsy but able to win.The philosophy of business seems to be unpredictable, but it already contains simple and easy-to-understand truths.Ma Yun emphasized that there should be no utilitarianism in doing business. Only when the partner is successful can he be successful, instead of thinking about how to make other people's money from the beginning.The more seemingly easy to understand the truth, the harder it is to practice. Ma Yun has worked hard on the realm of "Guan Chongjian". Ma Yun once rejected Son Zhengyi's $30 million investment.Alibaba continues to be absolutely controlled by the management team.Ma Yun is definitely not a person who has an eye for money. He has always had a clear judgment on investment.He has always adhered to two basic principles in financing: one is never to transfer the controlling stake; the other is to actively choose. Alibaba has had several financings over the years, including three large financings worth over 100 million yuan.But no matter Softbank or Yahoo, neither of them got a controlling stake in Alibaba. This is one of the reasons why Ma Yun insisted on returning Masayoshi Son's US$10 million.The controlling stake is still in the hands of the Alibaba team. Many websites are frantically chasing venture capital because of the shortage of funds, almost to the point of asking for money.And Alibaba's financing has always insisted on focusing on me and taking the initiative to choose.Even in the most difficult moments, Jack Ma still sticks to this principle.Everything is based on the interests of Alibaba and based on Alibaba's long-term strategy.Of course, the reason why Jack Ma is able to do this is not unrelated to having a first-class team and a brand with great potential in his hands. Corresponding to Ma Yun's picky investors, he treats investors' money with caution.Alibaba always adheres to one principle: it spends the money of investors, so be very careful.What they think about every day is how to spend the least money and achieve the best results. It is precisely because Ma Yun has no utilitarianism and is cautious about investment that he can be favored by investors. In April 2000, the Nasdaq Index began to plummet, and the Internet industry fell into a downturn. Many companies could not get any investment. At this time, only Jack Ma's Alibaba had sufficient funds and no worries about food and clothing. In Ma Yun's view on financing, investors who are "too strictly controlled" are absolutely unacceptable.Because for entrepreneurs, this type of investors often has a strong sense of utilitarianism, and even has the mentality of "making a profit" and running away.This will undoubtedly bring great constraints and risks to the development of enterprises.Although the ultimate goal of capital is to chase profits, Jack Ma still chooses investors who really regard venture capital as a career as much as possible. Sun Zhengyi is an investor who meets Jack Ma's requirements.Since investing in Alibaba, Sun Zhengyi has always trusted Ma Yun very much, and has almost never interfered in the company's related affairs.Masayoshi Son and Jack Ma have the same philosophy, and they have long-term strategic considerations for Alibaba in order to win in the future.When the industry was at its lowest point, they still insisted on taking a long-term view.What's even more rare is that Sun Zhengyi later voluntarily surrendered 350 million US dollars of shares.He said that he quit because he wanted to be a lifelong friend with Jack Ma. It is natural to make money in running a business, but masters always take a long-term view and pay attention to stages.Ma Yun pointed out at the 2007 annual meeting that Taobao, Alipay, Alisoft, and Yahoo are not eager to make money. The most urgent task at present is to scale up, and the money will come naturally in the future.He expressed that he would forget about money, forget about making money, and ignore the accusations from the outside world. Ma Yun's business is not only to make money, but also to create value for society.It is this concept that enables Jack Ma to grasp the lifeblood of the Internet.It is also based on this firm belief in e-commerce that he did not pursue temporary utilitarianism, but determined to make Alibaba one of the top ten websites in the world, so as to realize the goal of "as long as you are a businessman, you must use Alibaba". Target. "Shaoze Sword" is connected to the little finger of the left hand and belongs to the Jueyin Pericardium Meridian, which is characterized by coming and going with subtle changes.The market competition is also unpredictable. It was a hot industry just now, but it immediately became bleak and neglected. This requires flexibility and unconventional thinking.Although in the face of sudden changes in the market, you can adopt a strategy of remaining unchanged to respond to all changes, but the premise is that you are not afraid of changes and the cold winter.Ma Yun even thinks that the longer the winter, the better, because as long as he knows how to make subtle changes, he can survive the winter safely and welcome the next bright spring. The cold winter crisis at the end of 2000 and early 2001 was the first major crisis in Alibaba's entrepreneurial history.At that time, the global Internet industry entered a cold winter, Internet stocks plummeted, and countless websites were in turmoil.In order to survive the crisis, Ma Yun decided to withdraw the station and lay off staff, and fully contracted.This is just the first step, the second step is to consider how to make a profit. In 2000 and 2001, many people criticized Alibaba on the Internet for not knowing how to make money, saying that Alibaba's model must not work.Faced with tremendous pressure, Ma Yun did not waver, let alone give up.After many attempts, he finally found a profitable product - a Chinese supplier and TrustPass.These two products helped Alibaba out of the woods. In the face of this unprecedented cold winter, Ma Yun's eyes are still fixed on the future, and he wants to take advantage of this crisis. In the second half of 2000, Alibaba launched three campaigns: "Yan'an Rectification Movement", "Anti-Japanese Military and Political University" and "Nanniwan Land Reclamation".These three campaigns have cultivated a large number of reliable employees for Alibaba and accumulated the necessary funds.Ma Yun is waiting for the opportunity, waiting for the spring.Later, the opportunity and the spring made him wait.The most important thing is that Ma Yun not only resolved the crisis, but also successfully used the crisis.Resolving a crisis requires guts and courage, and taking advantage of a crisis requires vision and wisdom. Jack Ma has everything in these aspects. SARS was another serious crisis. The "SARS" in 2003 was terrible because it could not only kill people, but also kill enterprises.The once-in-a-century "SARS" paralyzed Alibaba, the world's largest B2B website.At that time, Alibaba did 3 things to deal with this crisis. 1. Defeat "SARS" with SOHO, and change centralized office to decentralized office. The 500 employees worked independently, not only maintaining the normal operation of the company's two major websites, but also increasing the performance by 5 times. 2. Help enterprises resolve the "SARS" crisis.Alibaba has used its mature e-commerce platform to help many enterprises, especially small and medium-sized enterprises, to tide over the difficulties.According to the survey, half of Alibaba's member companies were not affected by SARS, and some companies' business even rose instead of falling. 3. Take "SARS" as an opportunity to bring e-commerce into the spring.During the SARS period, offline transactions came to a standstill, which brought opportunities for online transactions.Alibaba has made many companies realize the value of e-commerce, and its members increase by 3,500 every day, an increase of up to 50%.By mid-June 2003, the goal of daily income of 1 million yuan and annual income of over 100 million yuan was achieved ahead of schedule. Through these three measures, Ma Yun has seized the big business opportunity in the crisis and achieved a great leap forward, which can be regarded as a perfect interpretation of the contingency method of taking advantage of the crisis. When others think that spring is coming, Jack Ma doesn't think so.Not only does he not believe that spring is here, but he also hopes that the winter will be longer and better.Why does Ma Yun hope that the winter will be longer and better?He explained it this way: On the one hand, the cold winter can eliminate bacteria. From the perspective of competition, the winner at this time can get more opportunities and resources.On the other hand, the four seasons rotate throughout the year, and it is impossible to have only spring without winter.If it's all spring, people will be too tired.Not everyone will die in winter; likewise, not everyone will blossom and bear fruit in spring.Only the strong can survive the biting cold wind and usher in the warmth of spring. In the face of a crisis, Jack Ma's response is to not give up first, and then take timely measures to resolve the crisis.Therefore, for Ma Yun, winter is not only a demon that puts companies to death, but may become a golden season for companies to turn the crisis into safety. The "Shaochong Sword" is connected to the little finger of the right hand and belongs to the Heart Sutra of Shaoyin.Like this sword technique, an entrepreneur who starts a business must have his own real purpose.Ma Yun has a real view on the social responsibility of entrepreneurs and puts it into action.These are actually his real motivation and purpose for creating Alibaba. "Entrepreneurs' social responsibility" has always been one of the hot topics in the global business community. In the past one or two years, domestic business circles have also begun to frequently use "social responsibility" as a core consideration indicator in the entrepreneur evaluation system.But there are often different opinions on what social responsibility is, and there is no consensus.Jack Ma gave a different definition to this question: "Social responsibility should not be an empty concept, nor limited to charity and donations, but is closely related to the company's values, employment mechanism, business model, etc. A company should make money, make a lot of money, and many people do this I think, but this is not the purpose of Alibaba. Let employees work and grow happily, let users get satisfactory services, and let the society feel the value of our existence. This is where Alibaba’s sense of social responsibility lies. As for making money and social returns, that is It's a matter of course." According to Ma Yun's philosophy, Alibaba can give up part of its profits for social responsibility, and will not do things that should not be done to make money. When Alibaba first decided the direction of business development, e-commerce was still an area with an elusive prospect.At that time, games and text messages, two profitable options, were also placed in front of Jack Ma.Jack Ma made an in-depth investigation on these two businesses. "After the investigation, I was shocked," Ma Yun said, "I can't accept the murder, violence, and pornographic content in some games. How can I sell this kind of thing to the society, especially children?" So he decided not to play games.For SMS, after research, Jack Ma found that there are a lot of fraudulent behaviors in the SMS business, and many profitable SMS businesses start from this. "This does not conform to the principle of good faith that we have always adhered to." The SMS service was also denied. Alibaba chose e-commerce.In two or three years, Alibaba has grown rapidly.With the success of e-commerce, a new business has grown up and brought huge profits to Alibaba. This is the e-commerce solution business, which helps websites to build e-commerce systems.However, just in 2002, Alibaba suddenly canceled this business, which accounted for 70% of its total turnover at that time, because of the relatively common phenomenon of withdrawing kickbacks from the other party in this business. "This also violates the principle of good faith," Ma Yun said. "Since our power is not strong enough to change this, then we simply don't do it." Ma Yun said that China has a population of more than 1 billion, and many people may lose their jobs due to various reasons in 20 years. He hopes that e-commerce can help more people have employment opportunities. With employment, families can be stable and careers can be successful. With development, society will be stable, which is also a manifestation of corporate social responsibility. Measured from this perspective, Alibaba's B2B model has allowed tens of millions of small and medium-sized enterprises to break through the constraints of time and space, and find the upper and lower players in the industrial chain on a simple and practical platform, which not only changed their own destiny, but also improved It has strengthened the international reputation of the entire Chinese small and medium-sized enterprise class, and at the same time promoted Alibaba to become the largest e-commerce company as a matter of course.The C2C platform of Taobao, which is open to everyone, enables the most ordinary people to do their own small business through their own efforts, and also directly or indirectly creates a lot of job opportunities. The most commendable thing is that while cooperating with other economic forces in society, Alibaba Group has focused on two things: one is to build a social integrity system, and the other is to create social employment opportunities. Ma Yun has integrated the sense of social responsibility throughout his work and even into his own life.He used his actions to drive other people, and he used his spare no effort to appeal to the sense of responsibility of entrepreneurs. This feeling and sincerity are sincerely admirable.