Tea Leaf Nation

Meet 'Crazy Jack,' China's E-commerce Titan

A former employee says Jack Ma sees himself as an artist, not a businessman.

The fizzy anticipation surrounding Chinese e-commerce giant Alibaba Group's U.S. listing is a curious blend: equal parts investor giddiness (its initial public offering, or IPO, might be richer than Facebook's) and tart caution (the company is too secretive, abets piracy and fraud, has iffy corporate governance). This shouldn't be too surprising. Cross-cultural collisions on this scale tend to breed outlandish hopes and dark fears.   

Enter Porter Erisman, a former Alibaba insider, who has produced and directed his first ‘docu-memoir': Crocodile in the Yangtze: The Alibaba Story. The breezy one hour and 15 minute picture, released globally via video site Vimeo on May 28, isn't exactly a sobering bucket of ice water on Alibaba fever. But it serves to remind audiences that the e-commerce behemoth from the Far East has humble origins, that it was created in a tiny one-room apartment by, what Erisman calls in the film, a bunch of dreamers led by Jack Ma, or Ma Yun (pictured above), an eccentric former English teacher turned tech entrepreneur who founded Alibaba.

If that synopsis bears echoes of the Apple creation myth -- dreamers again, this time in a Silicon Valley garage -- it's meant to. Erisman, an American expat whose decade-long tenure at Alibaba afforded him a front row seat to the company's dizzying if sometimes rocky rise, set out to make a film that would humanize China's go-go tech industry and show Westerners the shared DNA that unites entrepreneurs the world over.

Erisman told Foreign Policy via Skype from Tokyo that he sees much Western skepticism toward Chinese companies, which he hoped to temper with an insider's view of a Chinese startup. "I would hope people in the West would embrace the idea of Chinese Internet companies growing to the scale of their Western counterparts because I think it's not a zero-sum game," Erisman said. "These green shoots at the grassroots level in China have the same hopes and dreams as entrepreneurs anywhere in the world," he added.

The film explains how Erisman, who hails from Denver, Colorado, first ended up in China in 1994 and quickly found himself hosting a travel show for Chinese state television before eventually being wooed by a web company in the scenic resort city of Hangzhou, not far from Shanghai. As he explains in the film, that company, an online business-to-business platform with zero revenue, was called "Alibaba" because the founders hoped that small businesses would use their site to say "open sesame" to global trade.

Erisman's journey is intercut with footage of Ma, who remains Alibaba's figurehead today. The film shows Ma from the pre-Alibaba days when he was attempting to launch China Pages, a sort of online yellow pages for the Chinese Internet. That venture failed, but the film also shows Ma gathering 17 friends in his apartment in Hangzhou in February 1999 to lay the foundation for what was to become the biggest e-commerce company in China.  

Ma's incredible focus and foresight are on display as he lays out his vision for the path ahead, telling his co-founders that they are building a global site to compete not with other Chinese platforms, but with Silicon Valley. He warns them that 8 am to 5 pm workdays won't cut it, since his goal is to take the company public by 2002. The film then charts the crazy ride from that day up to subsidiary Alibaba.com's Hong Kong stock exchange listing in November 2007. Meanwhile, the group's consumer retail site Taobao improbably manages to beat out deep-pocketed eBay for Chinese market share along the way. (The film's title comes from a famous Ma quip that described eBay as a shark in the ocean and Alibaba as a "crocodile in the Yangtze River.") Erisman's picture shows shy-looking computer nerds belting out karaoke at company parties, and employees crying tears of joy when the company finally begins to make revenue.

There are also crises to be managed, including a staff quarantine when a coworker gets SARS, a viral respiratory illness that led to international panic, in May 2004. It also depicts the fallout from Alibaba's partnership with Yahoo right around the time that the U.S. search company was revealed to have handed over the personal emails of journalists and activists to the Chinese government. Based on evidence delivered by Yahoo, the writer Shi Tao was sentenced to 10 years in jail for leaking state secrets; he was released in August 2013, 15 months short of serving the full term. The media held Ma's feet to the fire on this issue, but he has argued that Yahoo had no choice but to comply with local Chinese laws.

Erisman said he had tried to get his film shown by a Chinese broadcaster, but the deal fell through because he refused to delete some of the film's political content -- he declined to specify which scenes they wanted cut -- so there is no immediate plan for a China release. Its current incarnation also can't be viewed in China, as Vimeo is blocked there.

The film might be too hot for Chinese censors, but it is far from a takedown of Alibaba, and it can't fairly be called objective. It was, after all, produced and directed by an Alibaba shareholder who clearly still has affection for his former employer and colleagues. The film doesn't wade into a string of fraud cases that led to the resignation of two senior executives in February 2011, which to be fair, occurred after Erisman's exit. Nor does it touch Alibaba's persistent problems with pirated or counterfeit goods sold via its platform. (Craig Crosby, publisher of the Counterfeit Report, an online piracy alert site, was quoted by the Associated Press in a May 27 report saying that the cash from Alibaba's IPO would "open the floodgates on counterfeits.")

The picture also rarely shows Ma with his guard down. Erisman said he worried that he might upset Ma if he revealed too much personal information (Ma's wife and kids are never mentioned), but the person whom many call "Crazy Jack" might have preferred a more unvarnished take. Ma allowed Erisman access to the company's video and photo archives, but didn't see the film until 2012. Erisman said Ma's favorite part was a section Erisman debated including: the details of a distraught phone call after a tough round of layoffs when Ma asked Erisman if he thought Ma was a good person. 

Erisman admitted he wasn't sure how Ma would react, but said his former boss found it the best part of the film. "Maybe he appreciated that I captured that moment, the difficult part of being an entrepreneur that people don't normally see," Erisman said.

From the film, it's clear that Ma lives his work. Erisman says the Alibaba founders still get together on weekends to "play cards and drink tea." When asked whether enormous wealth and success had changed Ma, Erisman said it seems to have mainly boosted Ma's confidence as a manager. But, he added, Ma has never seen himself as a businessman. Instead he thinks of himself as an artist who is creating something for society. "He views work as an expression of yourself," Erisman said.

That observation was a re-phrasing of a coda at the end of Crocodile, where Erisman sums up why working at Alibaba had been so important to him and why he felt it was worthy of a film. "In a country where speech still has limits, my colleagues found self-expression in the form of a company," Erisman says in a voice over. "I felt if the rest of the world had seen the China I'd seen, maybe fear of China's rise would be replaced with optimism and hope." 

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Tea Leaf Nation

Are China’s Online Military Fanboys Accidentally Aiding Foreign Spies?

Chinese state media thinks so. Meet the country's legions of 'junmi.'

The posts read like a cross between an intelligence report, a video game, and a niche photo-sharing site. "I've got pictures of the Global Liberation Army's littoral combat ships," one anonymous Chinese Internet user boasts. Another shares images of F-16 fighter planes and offers to exchange them "with men who like the pomegranate sister." This argot may mean little to most Chinese netizens -- and indeed, the vast majority of Americans -- but it's catnip for the junmi, the ‘military geeks,' who obsess over the latest technology and developments among China's People's Liberation Army (PLA) and other forces around the world.

According to Chinese state media, junmi chatter is also unfortunately valuable information for foreign spies. A May 9 article syndicated across multiple news sites including Xinhua, China's official news service, warns that "online agents" for "foreign intelligence organizations" have gleaned secrets about China's military from the many online forums which junmi inhabit. It also explains some curious terms of art popular among the cohort: "pomegranate sister," a homophone for the Chinese word for sixteen, denoting F-16s; "Poppa 8," for the Shenyang J-8, a Chinese-built aircraft designed to intercept other aircraft, and jiujiu, or maternal uncle, homophonic with 99, which refers to a ZTZ-99, the PLA's main battle tank.

It's easy to imagine analysts outside of China striving to use all publically available information to advantage, no matter how sketchy. China's ranks of Internet users are still growing by tens of millions each year. Meanwhile, China and chief rival the United States have been trading accusations of cyber espionage for some time. In February 2013, U.S.-based cybersecurity firm Mandiant released a report accusing government-sponsored hackers in the Chinese city of Shanghai of stealing data from a "broad range" of organizations in the United States and elsewhere; on May 19, U.S. officials announced an indictment of five PLA officers in Shanghai on computer fraud and other charges. China responded on May 26 by accusing the United States of massive Internet surveillance of Chinese leaders and institutions.

Junmi slang, the article stresses, evolved from necessity. It's not only a way to distinguish among experienced Chinese military geeks ("hardcore big shrimp") and rookies ("food birds"). It also avoids breaching Article 432 of the country's Criminal Law, which states that intentional or negligent disclosure of Chinese military secrets can lead to up to 10 years in prison for serious offenses. But the leaks, the article laments, are still happening. (The article reads like a contemporary account, but it first made the rounds on the Chinese web in May 2011, before authorities dusted it off, and altered the piece's title to include the warning that writing in so-called "junmi jive" is like "dancing on the edge of a knife.")

Given the size of the junmi community, that may be enough to keep Chinese military authorities nervous. Major Chinese Internet portals such as Sina, Tencent, and Netease feature military channels, and there are dozens of independent online communities including Tiexue (literally, "iron and blood"), Supercamp, and Xilu. These sites, which include articles and discussion forums covering everything from military history to popular jokes, allow enthusiasts to exchange photos and information on the latest weaponry, discuss current events, and game out imaginary conflict scenarios.

These forums occupy a curious role in China's idiosyncratic and constantly expanding online ecosystem. Andrew Erickson, an associate professor at the U.S. Naval War College who focuses on China, tells Foreign Policy that junmi sites may also occasionally reveal what the government would prefer stay secret. But, he adds, the government also likely views the forums as useful to showcase Chinese military achievements, and even perhaps for leaking information when the government "wants to preserve some level of uncertainty or plausible deniability." 

Like many Chinese websites, they also provide a space for web users to vent their spleen. Perhaps not surprisingly, many junmi forums brand themselves "patriotic," and posters regularly use derogative terms to refer to countries or groups that they assume to be hostile to China's interests. Frequent targets include Japan, the Philippines, and most recently, Vietnam, where anti-Chinese riots broke out on May 13. (One May 23 headline on Xilu's homepage reads: "Vietnam -- We Can Fight Our Way to Beijing and Take Your Women," although the article, posted by an anonymous user, offers no credible source for this claim.) The United States also prominently features, its army often referred to as the "GLA," or "Global Liberation Army," a play off the People's Liberation Army (PLA), the name for China's military. The Xinhua article notes the term is frequently invoked among gamers, and originally referred to terrorist forces, but can now also refer to the U.S. military, which Chinese web users sometimes call the "world police." 

Patriotism -- or nationalism -- is popular. While traffic numbers are hard to verify, some junmi sites have become serious business ventures. For example, Tiexue founder Jiang Lei, a dropout from Beijing's prestigious Tsinghua University, started the site in 2001, when he was 17. By 2012 and again in 2013, Lei had made Forbes China's "30 Under 30" list of young entrepreneurs. A May 2014 interview in a local Beijing newspaper described Jiang as a dedicated Communist Party member who sees his mission as "reviving the Chinese soul."   

Of course, these forums are far from reliable sources of intelligence. The Xinhua article complains that in addition to leaks, rumors and simple mistakes born of ignorance can confuse readers, which easily leads "foreign militaries to reach mistaken judgments about the Chinese military, negatively affecting international public opinion." But given the opacity of the PLA -- which, according to the Pentagon, does not even publish its budget for "procurement of foreign weapons and equipment" -- it's sometimes the best that foreign observers, and even many Chinese, have to go on. 

Rachel Lu contributed research.

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