Umair Haque / Bubblegeneration
umair haque  


Design principles for 21st century companies, markets, and economies. Foreword by Gary Hamel. Coming January 4th. Pre-order at Amazon.

Friday, August 12, 2005

Yahoo + AliBaba

I've got to say, I don't think this is the greatest play. Besides the fact that I don't agree with the strategic rationale (viz, auctions != Yahoo competence IMHO), the valuation is rich, even factoring in expected hypergrowth, and perhaps you'll agree that sentiments like these sound a lot like famous last words, 1999 style:

"...He boasts that Alibaba now has the financial muscle and local expertise to deal a significant defeat to eBay and Meg Whitman, its high-profile CEO. "I know the Chinese user market and users better than Meg Whitman," says Mr. Ma, clad in a lime-green shirt and sipping a cup of tea. "Once we start to charge, we can be profitable in 18 months."

-- umair // 8:39 PM // 1 comments


Lots of news articles think that since Yahoo beat out eBay in Japan, it can do so in China. People forget that Yahoo!Japan has nothing to do with Yahoo!. (Yahoo owns a minority stake in Yahoo Japan and thats it) A better proxy is in china where with the same free model as Taobao it couldnt make a dent in either Taobao or EachNet. I'm not discounting the $1B in cash nor Jack Ma, I'm discounting Yahoo's value add in Alibaba. But ofcourse, I'm biased :)
// Anonymous will // 6:41 AM

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