Alibaba Lays Off More Than 35% Of Its Investment Team Amidst Continued Regulatory Crackdowns
Major cuts are being made at Alibaba amidst China’s ongoing regulatory crackdown.
It was reported early on Thursday morning that “over a third” of the company’s in-house deals team is being cut as a result of Beijing’s regulatory crackdown significantly slowing the pace of dealmaking for the company, Reuters said.
The company’s investment team, which had more than 110 people, is going to be reduced to about 70 people, according to four people with knowledge of the matter. The company has already informed workers of the news, the report says.
Alibaba had been making an average of about 44 investments each year from 2015 to 2021. Their activity peaked in 2017 when the firm made 70 deals that totaled $54 billion.
The team was once as large as 150 people in 2016, when Chinese firms went on a global asset buying spree.
Mid-level and Senior level people in the mainland are going to be the most affected by the news and the company also has dealmaking staff in Hong Kong. The company didn’t comment when asked by Reuters.
Chinese regulators had just imposed new fines on Alibaba on Sunday for “failing to comply with anti-monopoly rules on the disclosure of transactions,” Reuters wrote. The crackdown has “sharply slowed sales” for many of the companies affected.
The report notes that Tencent, one of the company’s rivals, also planned on cutting tens of thousands of jobs this year, marking one of its largest layoff rounds ever. Tencent also cited the regulatory crackdown, in addition to China’s continued war against Covid.
ByteDance, another tech name, also laid off members of its investment team back in January, it was reported. They, too, cited China’s regulatory crackdowns, which began in late 2020 with the goal of putting the country’s tech giants and brash entrepreneurs like Jack Ma in check from growing too far, too fast.
Alibaba started making additional layoffs in February and may lay off up to 15% of its total workforce, the report concludes.
Thu, 07/14/2022 – 18:40