Alibaba After Jack Ma

Daniel Zhang says he’s determined to blow up his own business before rivals or the trade war can

- Peter Elstrom and Lulu Chen, with Philip Glamann

For months, Daniel Zhang huddled with a small team in an underground garage in Shanghai. Alibaba Group Holding Ltd.’s chief executive was working on a secret plan that would sound crazy even to many of his own colleagues 100 miles away in Hangzhou. Zhang wanted to build a startup inside the e-commerce giant that would combine a grocery store, a restaurant, and a delivery app, using robotics and facial recognition to speed up logistics and payment.

That project, Freshippo, has since become a major part of Zhang’s blueprint for Alibaba’s future, with 150 stores and counting across 17 Chinese cities. On a recent weekday afternoon at a store in Hangzhou, plastic bins shuttled automatically along tracks in the ceiling, collecting goods from around the store for online orders. Deliverymen stood by to transport those goods anywhere within a 1.9-mile radius in as little as 30 minutes.

Zhang is the little-known 47-year-old with the unenviable task of stepping into the shoes of China’s most famous businessman. On Sept. 10 he added the title of chairman at Alibaba after assuming the CEO role in 2015. He’s the first person since co-founder Jack Ma to hold both positions at the same time. Ma is a global celebrity known for hobnobbing with heads of state and for his fiery speeches at gatherings such as the World Economic Forum. Zhang is slight and soft-spoken, often proceeding haltingly in English during calls with investors. Even in China, he’s largely unknown. At Alibaba headquarters, an employee’s parent mistook him for the janitor.