Jack Ma's "Death Warrant": The Truth Behind the Suspension of Ant Group's IPO

Jack Ma's "Death Warrant": The Truth Behind the Suspension of Ant Group's IPOIn 2018, Ant Group planned to go public simultaneously in Shanghai and Hong Kong, with a fundraising target exceeding $30 billion. However, in November 2020, its IPO was abruptly halted

Jack Ma's "Death Warrant": The Truth Behind the Suspension of Ant Group's IPO

In 2018, Ant Group planned to go public simultaneously in Shanghai and Hong Kong, with a fundraising target exceeding $30 billion. However, in November 2020, its IPO was abruptly halted. What exactly happened behind the scenes? This incident became Jack Ma's "death warrant" because in a previous financial summit, he had "fired shots" at the regulatory authorities with these ten words, prompting a full-scale investigation into Ant Group.

At the financial summit, Jack Ma publicly stated: "The internet has developed in a wild state." He subsequently launched sharp criticism at the traditional financial system, arguing that its deficiencies in service delivery could no longer meet the demands of the times and were instead hindering the innovative development of fintech. He questioned the service level of banks, bluntly stating that they "don't understand fintech, cling to the traditional financial mindset, and their services are limited to lending."

Jack Ma went on to point out: "In a place without credit, it's only natural for banks to collapse." This statement sparked massive controversy, even drawing the displeasure of regulators. After all, state-owned banks carry the hopes and aspirations of countless citizens; their collapse would not only be the demise of an institution but also impact the nation's creditworthiness. Jack Ma's comments were regarded as "reckless," directly attacking state-owned banks, and became the fuse that ignited the suspension of Ant Group's IPO.

Regulatory authorities swiftly launched a comprehensive investigation into Ant Group and ordered its rectification. During the rectification period, Jack Ma also gave a speech, stating: "The current market doesn't have the future we want, and what's good now isn't enough. We need to do our best under existing conditions and innovate." However, this statement didn't seem to reflect Ant Group's introspection on its own issues, but instead continued to emphasize innovation.

This incident also exposed the shortcomings in China's fintech regulatory landscape. Regulators realized that there was a lack of regulatory policies governing fintech companies. Consequently, the State Council called for regulation and rectification of the fintech sector, promoting the compliant development of fintech businesses.

Ant Group holds a significant market share in the fintech sector, which also raised national concerns. However, why the need to "deal with" Jack Ma? This is directly related to his company. The rectification of Ant Group reflects that while the fintech sector is brimming with innovative vitality, it also harbors numerous risks. While enabling the effective application of fintech, it's essential to ensure its safety and stability, preventing debt crises arising from excessive consumption.

The rectification of Ant Group also highlights Jack Ma's neglect of social responsibility. Take "Ant Credit" for instance. While Ant Group doesn't directly provide loans, it collaborates with deposit-taking financial institutions behind the scenes to offer high-limit loans to customers. However, Ant Credit's advertising doesn't highlight this aspect, merely promoting its convenient borrowing features without mentioning risk and interest issues. This has led some citizens to engage in excessive consumption, incurring huge debts.

As the legal representative of a company, Jack Ma should shoulder social responsibility and guide the company's growth. Regardless of size, every company should consider its social responsibility and impact, not just acting in its own interest. Jack Ma once said: "Ant Credit is a financial credit platform." While this statement is true, how to settle the accounts is something that Jack Ma and his company need to carefully consider.

When Jack Ma founded his company, his intentions were good: to integrate the "internet plus" concept into the daily lives of every user. However, as Ant Group expanded, the risks it faced also increased, and the temptations Jack Ma faced grew proportionally. As the founder, he should shoulder social responsibility to ensure the company has a long-lasting future.

Ant Group's IPO involved the investments of countless citizens. During that period, there was even an issue of multiple shares per person, leading some to speculate on a significant increase in Ant Group's market value, aiming to "buy high and sell low." Ultimately, the suspension of Ant Group's IPO also led to a market collapse.

Today, fintech companies are inevitably making mistakes in their decisions and choices due to the impact of the pandemic. The "dealing with" of Jack Ma is essentially a criticism and education, along with proposed rectification measures. Cost reduction and efficiency improvement are not for profit but to adapt to societal development. Ant Group also needs to establish a healthy business model to navigate the future regulatory environment.

Jack Ma should use this as a lesson and learn from it. As a company, it cannot solely focus on immediate interests but must uphold social stability to ensure long-term sustainability. Companies also need to continuously improve themselves, operating within their means, to better manage borrowers' funds and credit, and regulate societal behavior.

This incident serves as a warning: Companies, in their development, should not only pursue economic benefits but also fulfill their social responsibilities. They must avoid excessive consumption, safeguard social stability, and only then can they achieve sustainable and steady growth.

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