Jack Ma's 31 Rejections: How a failed KFC applicant built a $25 Billion Empire
The Rejection That Started It All
In 1988 Jack Ma, a recent graduate from Hangzhou Normal University applied for a job at a newly opened Kentucky Fried Chicken outlet in his hometown. 24 people applied for the job, and 23 got it. The one person that wasn’t hired, would go on to become the founder of the company that would raise $25 Billion in the largest IPO in US history and become one of the richest men in China.
Jack Ma Yun didn’t get hired by just one company after graduating. He applied to 31 different companies and got rejected by all of them. He was rejected 10 times by Harvard University to try and get in, rejected by Police Departments and rejected by hotels.
The man who would go on to create a multi-hundred billion dollar tech empire couldn’t even get a job at a fast food restaurant. While this may seem like the start of an inspirational speech, this actually happened. While this is real life, it is important to note that the actual details of Jack Ma’s story matter more. He didn’t become successful through talent, connections or capital. He became so by having the grit to keep going.
The Boy Who Biked 27km To Learn English
Jack Ma was born in Hangzhou, Zhejiang Province on the 10th September 1964. This city is now famous for its West Lake, but more recently for being the birthplace of China’s e-commerce revolution. He didn’t come from a wealthy family. His parents were traditional musicians and storytellers and Ma described his childhood as humble.
While he obviously wasn’t a genius student (he failed the Chinese college entrance exam twice), he displayed an unusual passion for learning English. During the early 1980s China had just opened up and foreign tourists were coming into Hangzhou. As a teenager, Jack Ma would bike 27km to the Hangzhou International Hotel to practise English with tourists.
This happened for 9 years. He would talk to tourists asking to show them around in exchange for them speaking to him in English. One of the tourists had trouble saying his Chinese name and began calling him Jack. This would stick with him for the rest of his life!
The most important relationship Jack Ma made during this time was with Ken Morley. Ken was an Australian engineer. Ken and his family came to Hangzhou in 1980. His son David became a pen pal with Ma and the families stayed in touch. Ken Morley would go on to help fund Jack Ma’s first trip to the USA.
The Trip That Changed His Life
In 1995 Jack Ma travelled to the USA with help from the municipal government. The reason he travelled there was to help resolve a disagreement about a highway project however the real significance of this trip was what he learnt.
During his time there, a colleague helped him get online for the first time. He typed “beer” into a search engine and realised there was no results from China. There was only German, American and European beer. This intrigued him so he searched for China in general. There was hardly any results. The most powerful information tool in human history had almost no presence in China.
This was the beginning of everything.
In the same year, Ma and He Yibing (a computer teacher) set up the first office for China Pages, a directory site for Chinese businesses. Ma registered chinapages.com in America in May 1995. In 3 years, China Pages had made him $800,000 worth of revenue. The first version of the website was very basic and not well designed. However, at 9:40AM he uploaded it and within 3 hours (12:30PM) he had emails from Chinese investors wanting more information.
He realised straight away that the internet was not a toy. It was infrastructure.
Where Alibaba Was Born
Between 1998-1999, Jack Ma worked as a head of an information technology company for the China International Electronic Commerce Centre (a department within the Ministry of Foreign Trade and Economic Cooperation). He wasn’t suited to this type of work so quit his job and went back to Hangzhou. He brought together 18 of his friends in his apartment and pitched the idea of Alibaba.
Alibaba was a B2B marketplace connecting Chinese manufacturers to international buyers. The pitch wasn’t perfect. There was no business plan, no revenue and no guarantee people would use it. However, Jack Ma knew exactly what problem he was solving. Chinese SMEs lacked a way to connect to global buyers and the internet could provide this.
In October 1999 and January 2000, Alibaba raised a total of $25 million in foreign venture capital from Goldman Sachs and Softbank. Alibaba was built to target the domestic e-commerce market and provide Chinese SMEs with a platform during the disruption of China joining the World Trade Organisation.
It took 3 years for Alibaba to turn a profit. The Dot Com Bubble burst in 2000 and thousands of internet companies collapsed. However, Jack Ma and his team only had a fraction of the money their competitors had. He later described this as the most challenging time of his life. While the technology wasn’t the issue, the business model had to be completely redesigned from the ground up.
The Empire Grows: Taobao, Alipay and Fighting eBay
By 2003, Alibaba had really got going and Jack Ma wanted to expand. He launched Taobao Marketplace to compete with eBay’s China operations. He also launched Alipay (the payment system that would go on to become the backbone of Chinese e-commerce), Ali Mama (advertising platform) and Lynx (now known as Tmall – the premium retail platform).
The most important decision he made during this time was refusing to sell Taobao to eBay. eBay had aggressively entered the Chinese market and bought EachNet (the local auction site). They expected to take over the market however when they offered to buy Taobao, Jack Ma said no. He accepted investment from Jerry Yang (co-founder of Yahoo!) and had the funds and strategy in place to fight back.
Taobao won. Taobao offered free listings while eBay charged for listings. It also built trust with the escrow system provided by Alipay. It also tailored to the specific behaviours of Chinese consumers. eBay pulled out of the Chinese market in 2006 and Taobao became the largest consumer e-commerce platform in China and still is today.
The $25 Billion IPO
In September 2014, Alibaba went public on the New York Stock Exchange raising $25 billion—the largest IPO in US financial history at the time. The listing valued the company at over $200 billion. This made Jack Ma one of the richest men in Asia.
This IPO wasn’t just a huge financial milestone for Jack Ma. It showed how big the Chinese consumer market was and how ambitious Jack Ma was. He had gone from being rejected by 31 companies to creating one of the most valuable technology companies in the world. Jack Ma became a symbol of what could be achieved by entrepreneurs that weren’t good enough.
What His CV Doesn’t Tell You
While it’s easy to list the facts about Jack Ma’s life, there is a theme to his story. Every major turning point in his career came after a rejection. The 31 rejections he faced made him start his own company. The failure of China Pages made him learn how to build something sustainable. Refusing to sell Taobao to eBay was a bold move most advisors would have said no to. Raising funds from Goldman Sachs and Softbank instead of safer smaller investors meant they had enough runway to survive the Dot Com Bubble.
His story isn’t a fairytale. It’s about having perseverance despite the evidence suggesting you should give up. He was rejected by people with more experience and resources.
What We Can Take From His Story
The most useful thing to take from Jack Ma’s story is that his early failures are very specific. He wasn’t bad at starting a company, he was bad at getting a job. He wasn’t bad at understanding the internet, he was bad at passing exams.
Getting a job requires different skills to starting a company. Jack Ma wasn’t a great employee. He had no degree, no technical skills and wasn’t polished. However he was a great visionary, could learn from anyone and was determined to keep going despite years of uncertainty. These aren’t traits a KFC manager wants. They’re the traits of a founder.
Rejection is information, not who you are. When you’re rejected by 23/24 people applying for a job, it’s easy to think you’re fundamentally not good enough. However rationally you should think if you’re applying for the wrong role or if the job market you’re applying to doesn’t value what you have. Instead of waiting for someone to give him an opportunity, Jack Ma created his own.
The early internet rewarded people who could see the gaps. He searched for Chinese beer and there were no results. The biggest opportunities are usually not in the areas everyone is fighting over. They’re in the areas where something obvious is missing.
The Uncomfortable Truth
Jack Ma’s story is often portrayed as proof that anyone can be successful if they’re determined enough. While this is true, it can be misleading. While perseverance was key to his success, luck, timing and circumstances played a massive role. He was born at the right time in the right place to be part of the wave of the Chinese internet revolution. Not everyone will be given this opportunity.
However, having the right mindset will help. Being willing to bike 27km to practise English with strangers, keep applying after 31 rejections and starting a company with 18 friends in an apartment when no-one with a traditional CV would hire you.
Jack Ma was rejected by KFC. They weren’t wrong to think he wouldn’t be a great employee. They just didn’t know what he would become.
