The Alibaba Insider
A 15-Year Veteran's Viral Corporate Autopsy Confirms Everything
Your 15-Year Employee Writes a Corporate Obituary
More than a year ago, in March 2024, I wrote my very first Substack article about Alibaba BABA 0.00%↑ , calling out their strategic mess and leadership failures. Now, a 15-year Alibaba veteran has written a 10,000-word corporate autopsy report that confirms everything I said.
The internal letter went viral in China but got little attention outside. Jack Ma even praised it—which either shows the company still has some openness or that even the founder knows the problems are real.
The employee posted this on Alibaba's internal forum before leaving. It's a brutal breakdown of how a great company became mediocre. Makes you wonder if they should have promoted him instead of letting him walk.
Because the letter did not get much attention outside of China, I share my highlights here.
The Outsider's Vindication
In March 2024, I noted how Alibaba had become the poster child for reactive management—always late to their own parties. The employee confirms this. He documents how the company that once defined Chinese e-commerce became what he calls "mediocre," obsessed with hitting numbers instead of pursuing their mission.
These problems weren't hidden. They were in the quarterly reports, the strategic pivots, the endless restructuring—hey, as I write this, just last week Ele.me and Fliggy got merged into the e-commerce unit. It makes sense but constant restructuring is definitely a theme and problem here. You didn't need insider access—you just needed to pay attention. The insider's account puts flesh on bones that were already visible.
The Man Behind the Letter
The story gets more interesting when you look at who wrote this. The employee (nickname "Yuan An") left significant stock options and bonuses on the table. This wasn't about hitting his equity vest—he walked away from millions because he'd lost faith in the organization.
His departure was planned years in advance. Two things triggered it: watching a friend his age die of cancer, and spending six years at Ant Group only to see the IPO collapse. As he put it: "If those six years were purely about waiting for stock options, it would be unbearably painful."
The guy's background makes his critique credible. He joined in 2010 as a fresh graduate, worked across multiple units (Koubei, Ant Group, DingTalk), and even wrote his university thesis on Alibaba's culture. This wasn't some disgruntled middle manager—this was someone who'd drunk the Kool-Aid so deeply he'd written academic papers about it.
He recalls early Alibaba culture when restaurants gave employees discounts not for high salaries, but out of respect for what the company was doing. He describes helping shut down a scam restaurant through Koubei's review system and feeling genuinely proud.
That culture is dead. The shift from mission-driven to money-driven coincided with the IPO, when stock prices made abstract equity grants very concrete.
The Acquisition Graveyard
The employee lists Alibaba's acquisition failures one by one: Koubei (shut down 2011, revived 2015, merged into nothing), Ele.me (lost to Meituan despite 50%+ market share), Xiami Music (closed 2021 after being #1), Youku (fallen to third), Lazada (beaten by Shopee).
"Over the years, the only acquisitions that could be considered successful were AutoNavi (Gaode) and possibly UC Browser."
That's not a track record—that's systematic money burning. When your M&A success rate is worse than coin flips, maybe fire your entire team. Or at least ask what they've been doing for a decade.
The Cultural Breakdown
The real story isn't failed acquisitions—it's how Alibaba's cultural foundation rotted. The employee describes how the company's "Old Six" values got perverted:
Customer First became Boss First: Instead of prioritizing customers, employees learned to prioritize their managers because "your boss controls your performance ratings, bonuses, stock options, and promotion nominations, so prioritizing your boss becomes the optimal strategy for survival."
Teamwork became Internal Competition: Rather than working together, teams started fighting each other for resources. "When external growth slowed and resources are limited, grabbing existing value became far more rewarding than creating new long-term value."
Integrity became Manipulation: The focus on results at any cost led to widespread gaming of metrics. "In a results-only culture, manipulation, deception, and falsified data have become routine."
The company went from mission-driven to full of what the employee calls "Wild Dogs" and "Rabbits." Wild Dogs are high performers who get results but ignore company values—they cut corners, waste resources, and fight over credit. Rabbits are employees who embody company values but can't deliver results. The ideal was "Bulls"—high performance with strong values—but those became rare. This explains why Alibaba struggles to execute despite massive resources.
The 996 Problem
The employee's take on 996 work culture (9am to 9pm, 6 days a week) cuts deep: "996 brings no real value—it just makes people look busy. We're not manual laborers. Creativity is driven by inner motivation, not external pressures."
This explains why Alibaba but also other tech companies struggle with innovation despite massive R&D spending. You can't force creativity through overtime policies. Though given the track record, calling it "learning" might be generous.
The System Breakdown
The employee identifies three main problems: people (blind faith in outsiders, weak middle management), compensation (inflated pay grades, unclear performance reviews), and business (confused strategy, fake metrics, bureaucracy).
These explain why my March 2024 observation about Alibaba's reactive approach wasn't just strategy—it was deeper rot. When middle management is full of incompetent executives who "talk in abstractions" and HR has lost all credibility, executing any strategy becomes impossible.
The Proposed Fix
The employee's solutions are basically corporate intervention: restore values, rebuild HR, reform management, make pay grades transparent, cut redundant personnel, "dial back operations and face the truth." These aren't tweaks—they're calls for fundamental restructuring.
The letter circulated openly on Alibaba's internal forum and got Jack Ma's acknowledgment. This suggests some capacity for self-reflection. Whether they'll act on it is another question. Given their track record, I'm not optimistic.
The Leadership Response
Alibaba's June 2025 shareholder letter suggests they may actually be listening. Joe Tsai and Eddie Wu acknowledge the exact issues the employee raised: divesting Daniel Zhang's disasters (Sun Art, Intime), streamlining portfolio, embracing a "startup mindset" with "creation, not preservation" in their DNA. Daniel Zhang, the architect of Alibaba's downfall, had pushed the company into costly physical retail investments that are now being unwound.
They hit buzzword bingo with "user first, AI-driven" strategy—but unlike previous strategic pivots, this one actually makes sense given the AI boom and their cloud infrastructure advantages.
But the new management team is actually executing on some real changes. Divesting non-core assets? Check. Focusing on core businesses? Check. The divestitures of Daniel Zhang's tenure are already promising and show they're serious about fixing the mess. Joe Tsai and Eddie Wu seem to understand what needs to be done.
The harder question is whether they can fix the deeper cultural and management issues, or just rearrange deck chairs while organizational culture rots. The promise to "embrace a startup mindset" sounds good, but you can't think like a startup when your organization is riddled with incompetent executives and broken incentive systems.
Still, the current leadership appears more focused and decisive than what came before. Fixing culture takes time, but the early moves suggest they might actually pull it off.
What This Means
The employee's observation deserves attention: "The dilemma Alibaba faces is a miniature of the broader challenges confronting China today." The company's struggle to move beyond "excessive competitions" and "widespread involution" reflects China's economic transition challenges.
For investors, this confirms what external numbers show: Alibaba's problems run deeper than market conditions or government pressure. They're facing a basic crisis of how to run a company.
As an outsider looking at quarterly reports and strategic announcements, these issues were obvious by March 2024. The insider's account confirms the problems are worse than they appeared.
Conclusion
Sometimes the best market research comes from someone walking out with nothing to lose. This employee shows how companies fall apart from inside—and why even businesses with huge resources struggle to execute basic strategies.
The fact that Alibaba's leadership seems to address some structural issues the insider raised is encouraging. But fixing acquisitions is easier than fixing culture. Whether they can restore the values and systems that made them great—or just become a more efficient version of the same broken organization—remains to be seen.
Back in March 2024, when I first wrote about Alibaba's problems, the company was at a crossroads. The insider shows they have people who can spot problems clearly. The leadership letter suggests they're trying to act on some insights. Whether they can execute before more talent walks out is the real test.
Here are my latest articles on Alibaba:
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