JACK MA’S ANT GROUP BEATS ODDS TO BECOME A $200B COMPANY

When Jack Ma launched an obscure payment service to boost his online shopping empire 16 years ago, few expected it to succeed. Now that service forms the backbone of Ant Group, a behemoth that could be worth more than $200 billion, Sherisse Pham wrote in an analysis for CNN Business.

Named after a bug because of its founder's belief that "small is beautiful, small is powerful," Ant Group is anything but tiny in China. It's gearing up for a highly anticipated public offering in Hong Kong and Shanghai that could mark the second time Ma sets a record for the biggest IPO ever. "Ant Group really is the crown jewel of Jack Ma and ... of China's internet industry," said Edith Yeung, general partner at Race Capital. 

It is one of the biggest technology firms in the world and the biggest online payments platform in China. The app has established its presence in every aspect of financial life in China, from investment accounts and micro savings products to insurance, credit scores and even dating profiles. 

But it all started out as a side project to plug a hole in China's nascent online shopping industry. Back in 2004, very few people had debit or credit cards, and buyers and sellers using Alibaba's (BABA) e-commerce platform needed a reliable way to handle payments. Ma tasked Alibaba's finance team to create Alipay. The service would act as a trusted third party, holding money from buyers in escrow and only releasing it to sellers after the goods had been received and buyers confirmed they were happy with what they got. "When I started [Alipay], everyone said: 'Jack, this is the most stupid model we've ever seen, nobody will use it,'" Ma said in a 2014 interview with CBS News' "60 Minutes." "I said I don't care if this model is scientific, whether it's fancy-looking, or not. As long as it works, it helps [to] build up the trust," he said.

The Financial District would like to learn more from its audience. Can you please give us feedback on this article you just read. Click Here to participate in our online survey.