infringement, and governmental interference. Those characteristics
are inconsistent with the Western values that underpin aspirational
brands. And it hasn’t helped that Alibaba’s early reputation was
tainted by claims that many of its small retailers were disreputable.
Ultimately, Alibaba may benefit from the success Apple has had
with overcoming concerns about Chinese manufacturing quality, and
from other Chinese firms, such as WeChat, developing global
followings. Yet the ultimate brand power—an aspirational brand that
connotes leadership, luxury quality, and sex appeal—remains a reach
for Alibaba. In 2016’s list of the hundred most valuable brands, Forbes
did not include Alibaba.^9
Alibaba comes up short on visionary capital and has struggled to
master storytelling—not just with consumers, but with investors, as
Alibaba’s opaque governance clouds the story. By comparison, the
Four Horsemen are all acknowledged masters at telling their stories,
selling their vision, and convincing shareholders to join their Great
Crusades. Alibaba, as a conglomerate, doesn’t have a real story to tell
other than one of continuous success. As we’ve learned, that’s not
enough.
Finally, a critical limitation to Alibaba’s long-term success is the
company’s entanglements with the Chinese government. The
government has supported its investment in a variety of ways, perhaps
most substantially by severely curtailing the operations of Alibaba’s
U.S. competitors in China.^10 Western investors are willing to accept
some level of government interference, but they don’t like what seems
to be cheating, and the market distortions that result.
While this relationship has doubtlessly been an asset for Alibaba
during its growth, investors must be concerned about whose interests
will win out when those of global shareholders do not align with the
company’s superpower patron. Indeed, because of Chinese restrictions
on foreign ownership in Chinese assets, foreign investors do not
actually own shares in Alibaba, but in a shell company with a
contractual right to Alibaba profits—contractual rights enforceable
only in Chinese courts.^11 And worse, there are signs that Alibaba
cannot count on the support of the Chinese government, with critical
stories about the company appearing in Chinese media and from
government agencies since 2015.^12 ,^13