Jack Ma has some blunt advice to startups: “If it’s hot, forget it.”
“By that time everyone is doing it. It’s too late,” Ma told attendees of the Jumpstarter 2017 finale at the Hong Kong Exhibition and Convention Centre last night.
Ma, who shared the stage with Hong Kong chief executive Carrie Lam, was on hand to present US$1 million in funding to winning startups from medical, agricultural and energy sectors.
Ma encouraged startups to pursue their dreams.
“The advice is first you should be optimistic – a great entrepreneur is optimistic for the future. And you have to answer what problem will you solve. What way can you solve it which is different? Why are you better than anyone else?
“The second is that you have to find a group of people who can work together. Those people who have the same ambition. Those people coming to join you not just because it is a job, but because they believe in you and they believe in the mission.
“And the third is: What price are you going to pay for it. You don’t ask “What can I get?” You ask “What can I give?”. If you have a great idea, you may have to wait 10 years. If you think I will win this in three years, prepare for five years.”
Ma said when he conceived Alibaba 18 years ago and went out to raise money from venture capitalists, he was rejected by all of them.
“The first money I got from a capital fund was $50,000. I thought this would last 10 months. We even counted every cent we spent. But it lasted only four months. We were almost bankrupt.”
He also warned startup founders to be patient.
“Today if you are only a tractor, don’t try to put a Boeing 747 engine inside. It will destroy you. You should find the people who suit the company. I have hired a lot of vice presidents from big companies – they almost destroyed my company. I only had $5 million and a guy came in with a marketing plan $12 million. I said: How can you have $12 million? He said: “I have never made a plan below $20 million.
“Find the right person,” said Ma.
He urged governments if they cannot fund startups, why not reduce the tax to them.
“I’m doing that,” interjected Lam, who has met with Ma four times since her election in July and enjoyed wide-ranging discussions on technology and business.
Both people said they were “very optimistic” about Hong Kong’s future as a base for startups.
Ma said that although the city is not a large market, Alibaba is interested in the talent that the city offers. Its capital and technology also appealed.
“The reason why Hong Kong has been so successful in the past 50 years is because Hong Kong is very open-minded, and accommodates all kinds of cultures. [Hong Kong] should also welcome people from all over the world,” he said.
“Young people in Hong Kong, don’t focus your eyes only on Hong Kong. America, Europe, anywhere there is opportunity, go there and build something and bring ideas back.”
Lam said Hong Kong needed to review immigration policies to encourage entrepreneurs to come to the city.
“We need more time to nurture local talent and [in the meantime] we need to bring in outside talent. Hong Kong remains very attractive to a lot of expatriates and people from the mainland,” she said.