Alibaba’s Joe Tsai on US-China Rivalry, AI Future, Owning the Nets/Liberty, Caitlin Clark’s Impact

Summary

Alibaba Chairman Joe Tsai joins the All-In Podcast for a live interview covering his unique perspective as someone straddling the worlds of American sports, Chinese technology, and US-China geopolitics. The conversation opens with a discussion of the WNBA and Caitlin Clark’s extraordinary impact on the league, with Tsai revealing that Clark drove a 4x increase across all WNBA metrics including viewership, ticket sales, and sponsorship. Tsai offers a nuanced view on the NBA product, noting his role on the league’s competition committee and arguing that the committee should really be called the “product committee” since rule changes directly affect the fan experience.

The interview takes a substantive turn when Tsai recounts the Alibaba origin story, describing how he was “mesmerized” by Jack Ma’s personality and leadership. He draws an insightful analogy between Ma’s teaching background and natural leadership ability, noting that teachers make natural leaders because they communicate well, identify talent, and have the humility to celebrate when their students surpass them. Tsai provides a remarkably candid assessment of China’s economic arc, describing 15 years of free-market growth followed by a government crackdown that he characterizes as ultimately beneficial because it created a more predictable regulatory environment.

The most provocative segment comes when the hosts probe US-China rivalry. Tsai pushes back on the narrative of China as an existential threat, pointing out that China hasn’t started a war in decades and cares primarily about economic development and citizen welfare. Sacks offers a realist counter-perspective rooted in international relations theory, arguing that the US doesn’t tolerate peer competitors because power is zero-sum. Tsai responds with a striking argument: in AI, there is no such thing as “winning the race” because it’s a marathon with no finish line, and he urges the US to focus more on adoption and diffusion of AI rather than solely on building the most powerful models. He reveals that AI adoption among Chinese firms jumped from 8% to nearly 50% in just one year, and that the Chinese government has announced a policy targeting 90% AI agent penetration by 2030.

Highlights

”Caitlin Clark’s 4x impact on the WNBA”

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“Caitlin Clark definitely had an effect on the WNBA. All the metrics went up. Viewership, ticket sales, sponsorship, everything went up like almost 4x. The economic impact that she’s made to the league is extraordinary. Undeniable.” — Joe Tsai, 1:46

”Jack Ma: the teacher who became a leader”

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“He’s a teacher by training. Teachers in a way make natural leaders because you have to communicate well and you can identify talent. Teachers have enough humility that they’re very happy if their students go off and become more successful than they are. In building a company, you need to be able to accommodate people who are smarter than you.” — Joe Tsai, 7:00

”China hasn’t started a war in decades”

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“China has not started a war in the last how many years? 30 years, 40 years. If you observe the behavior of the Chinese people and the Chinese state, it’s a very peaceful nation. China cares about its own economic development. They care about the well-being of its citizens.” — Joe Tsai, 12:00

”AI is like air”

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“AI is such an important element of life. It’s almost like air. Why would any one country say we have a sole claim to air? There’s so many things AI can do in medicine, in biology. I think there’s a lot of room for cooperation.” — Joe Tsai, 18:20

”From 8% to 50% AI adoption in one year”

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“I’ve seen a survey of Chinese firms. Last year only 8% were using AI in their business. Now that number is approaching half, 50%. The adoption rate has been fairly fast. My definition of winning is not who comes up with the strongest AI model, but who can adopt it faster.” — Joe Tsai, 20:00

Key Points

• Caitlin Clark’s 4x WNBA Impact (1:46) - Tsai reveals that Clark drove 4x increases across all WNBA metrics: viewership, ticket sales, and sponsorship; the economic impact was extraordinary and undeniable
• WNBA Talent Pipeline (3:00) - Beyond Clark, Tsai highlights Sonia Citron who broke the record for highest three-point shooting percentage; tremendous amount of new talent entering the league
• NBA Competition Committee as Product Committee (5:00) - Tsai serves on NBA’s competition committee alongside Jason Kidd, Chris Paul, and Coach K; argues it should be called the “product committee” because rule changes like the three-point line are product decisions
• Jack Ma’s Leadership Style (7:00) - Tsai was mesmerized by Ma’s ability to instill faith in people and paint a strong vision; Ma’s teaching background made him a natural leader who could identify talent and accommodate people smarter than himself
• Alibaba’s 26-Year Arc (8:30) - First 15 years were complete free-market growth; then extreme competition with five fierce competitors including ByteDance in e-commerce; government crackdown led to more predictable regulatory environment
• US-China Rivalry Framing (10:10) - Tsai pushes back on viewing China as existential threat; notes China hasn’t started a war in 30-40 years; primarily cares about economic development and citizen welfare
• Sacks’ Realist Perspective (13:00) - Sacks argues from international relations realism: the US doesn’t tolerate peer competitors because power is zero-sum in an anarchic world; China’s growing wealth and tech strength flows into military strength
• Open Source AI in China (17:00) - Chinese companies espousing open source; Alibaba has models at 1.7B, 4B, and 8B parameters for mobile devices; smaller models more conducive to faster adoption
• AI Adoption vs Model Building (18:20) - Tsai argues winning in AI isn’t about who builds the strongest model but who can adopt faster; AI is like air and no one country should have sole claim to it
• 8% to 50% AI Adoption (20:00) - Chinese firm AI usage jumped from 8% last year to approaching 50%; adoption rate has been remarkably fast
• AI in Alibaba Operations (19:46) - AI infused into all consumer-facing apps including e-commerce, maps, and food delivery; consumer experience improvements driving revenue uplift; roughly 30% of code now written by AI
• Corporate Focus Strategy (21:52) - Tsai returned to chairmanship and narrowed Alibaba from six businesses to two core businesses: e-commerce and cloud computing with AI; focus was crucial for execution
• China’s 90% AI Penetration Goal (23:17) - Chinese government launched “AI plus” policy targeting 90% penetration of AI agents and devices in society by 2030; government is “all in” on AI
• Youth Unemployment in China (24:00) - Youth unemployment (16-24) at 18%; driven by property slump with home prices down ~30% creating negative wealth effect; 10 million college graduates per year
• AGI Timeline (25:00) - Tsai estimates AGI is probably 20 years away despite more optimistic predictions; the emphasis is on the word “general” - AI must generalize and apply principles to unseen scenarios
• Nets Rebuilding Year (22:30) - Tsai confirms Nets are in rebuilding mode; five draft picks used this summer, one pick in 2026; very young team

Mentions

Companies

• Alibaba (0:10) - Joe Tsai is chairman; 26-year-old company now focused on two core businesses: e-commerce and cloud computing/AI; stock surged 14.5% on Qwen 2.5 Max launch
• ByteDance (8:30) - Parent of TikTok; one of Alibaba’s fiercest competitors in e-commerce; revenue reportedly surpassed Meta’s
• Brooklyn Nets (0:49) - Tsai is owner; in rebuilding year with young team; used five draft picks this summer
• New York Liberty (0:54) - Also owned by Tsai; WNBA team benefiting from Caitlin Clark era

Products & Technologies

• Qwen 2.5 Max (0:13) - Alibaba’s AI model referenced in intro as their “secret weapon”; launch drove 14.5% stock surge
• Qwen Model Family (17:00) - Alibaba’s open source models at 1.7B, 4B, and 8B parameters for mobile devices and laptops

People

• Joe Tsai (0:10) - Alibaba co-founder and chairman; owner of Brooklyn Nets and New York Liberty; provides unique US-China perspective
• Jack Ma (6:07) - Alibaba co-founder; former English teacher at Zhejiang University; described by Tsai as having mesmerizing ability to instill faith in people
• Caitlin Clark (1:25) - WNBA star who drove 4x increase in all league metrics; out for the season; rivalry with Angel Reese
• Angel Reese (2:30) - WNBA player; rivalry with Caitlin Clark dating back to college; some try to frame it as racial
• Sonia Citron (3:00) - WNBA rookie of the year candidate; broke record for highest three-point shooting percentage
• John Mearsheimer (13:00) - Professor referenced by Sacks who explained at All-In that the US and China are in high-tech and security competitions
• Jason Kidd (5:00) - NBA coach; serves on competition committee alongside Tsai
• Chris Paul (5:00) - NBA player; serves on competition committee
• Coach K (5:00) - Legendary basketball coach; serves on competition committee

Surprising Quotes

“Teachers make natural leaders because they communicate well, they can identify talent, and they have enough humility that they’re very happy if their students become more successful than they are.” — Joe Tsai, 7:00

“China has not started a war in 30, 40 years. If you observe the behavior of the Chinese people and the Chinese state, it’s a very peaceful nation.” — Joe Tsai, 12:00

“The United States does not tolerate peer competitors. We want to be the most powerful country. The balance of power is to some degree a zero-sum game. Economics are not, but power is.” — David Sacks, 13:00

“In AI, there’s no such thing as winning the race. It’s a long marathon. Every week there’s a model that’s leading, but then the next week another model overtakes them. My definition of winning is not who comes up with the strongest model, but who can adopt it faster.” — Joe Tsai, 18:20

“People in government in China don’t talk about AGI too much because they believe they could control it better than here in the US. But if Denny’s saying 5 to 10 years, I think AGI is probably 20 years from now because the emphasis is on the word general.” — Joe Tsai, 25:00

Transcript

0:10 For people who don’t know who he is, please give us an introduction to Joe Tsai. He’s the owner of the Nets and he’s now chairman of Alibaba. We like innovation from the bottom up. Alibaba just dropped their secret weapon, Qwen 2.5 Max. Alibaba surged 14.5% overnight, beat estimates on nearly every metric. A massive rally alone this year, adding about 100 billion to the stock’s value. You have to have a growth mindset when you compete.

0:44 Ladies and gentlemen, please welcome Joe Tsai. Hey, my man. Good to see you. Good to see you, brother. How are you? David, how are you? The Brooklyn Nets. Nets and the New York Liberty. It’s not easy running a team, is it? It’s not easy at all because a basketball, any professional team is both a business and also it’s an institution. You need to keep the fan base happy. So there’s sort of this church and state element. It’s almost like running a news organization.

1:25 Can we start with the WNBA? Caitlin Clark is out for the season and there’s been a lot of controversy and attention. What has the league done right? What has it done wrong? Has the league been doing enough to protect her as a star? It’s been almost a microcosm for a social discussion. Caitlin Clark definitely had an effect on the WNBA. All the metrics went up. This was last season when she first came into the league from college. Viewership, ticket sales, sponsorship, everything went up like almost 4x.

2:30 The economic impact that she’s made to the league is extraordinary. Undeniable. But because of who she is, she’s a point guard, a smaller player. The knock on her was whether she could withstand all the physicality of the league, and she’s proven she can. Unfortunately, there’s been this rivalry with Angel Reese dating back to college. Some people would like to pit it as a racial thing. I think we need to look past that and just look at the skill set being brought into the league now.

3:00 We have so many great college players. The rookie of the year potential candidate is Sonia Citron. She just broke the record for the highest three-point shooting percentage in the league. You see tremendous talent. The one thing that’s really changed is that prior to the Caitlin Clark season, your average fan base watching ESPN was not watching women’s basketball. But now the mainstream sports fan base is watching the WNBA.

4:00 It’s more physical. They’re tougher in the WNBA. Every time LeBron goes up and he gets fouled, he’s flopping. They’re so tough and throwing each other around. It’s a better game. The NBA product is great. I don’t think it’s fair to compare physicality between men’s and women’s leagues. If you are sitting on the floor you are watching physicality and athleticism.

5:00 The NBA has this competition committee. I got put on it alongside Jason Kidd, Chris Paul, and Coach K. The committee should be called the product committee because that is the product the fans see on the floor. If you change the three-point line, that is a product decision. When you watch the Boston Celtics throw up 43 threes in a game, is it a good product? I think it’s a great product because there are 18 different ways you can throw up 43 threes.

6:07 Let’s transition to Alibaba. Take us back to the beginning. I was just mesmerized by Jack’s personality. Every people see the public side of Jack which is very charismatic but what I saw was he was able to instill faith in people. When I walked into his apartment, there were 12 to 15 very young people, students just coming out of college, and Jack was the teacher that’s 10 years older. His ability to lead is amazing.

7:00 He’s a teacher by training. He taught at Zhejiang University. He taught English. Teachers in a way make natural leaders because you have to communicate well and you can identify talent. A lot of teachers love to see their students go off and become more successful. Teachers have enough humility that they’re happy when that happens. In building a company, you need to accommodate people who are smarter than you. That’s really important.

8:30 Alibaba has been around for 26 years. The first 15 years were complete free-market growth. We built a lot of business organically. Then we went into extreme competition. Everybody wanted to do e-commerce because if you have traffic online, e-commerce is the best way to monetize. We have five very strong competitors including ByteDance, the parent company of TikTok. Then the government felt the sector had gotten out of line. There was a crackdown and more regulations came in. Some are very good, protecting privacy and anti-monopoly. Now we’re in a new normal where the regulatory environment is more predictable. We know what the red lines are.

10:10 On a geopolitical level, the rhetoric in the United States keeps drilling into Americans to look at China as an existential threat. I don’t agree with that view. I understand why sitting in America you look at the rise of China over 25 years: manufacturing, exports, technology. The fear is that economic strength and technology strength flow into military strength and that becomes a national security issue. I get it. But these are the two largest economies in the world. We should compete with China, but there are so many trouble spots in the world.

12:00 What did President Trump say? He stopped seven wars. China didn’t start any of them. China has not started a war in 30, 40 years. Maybe the Korean War and Vietnam War, but that was a long time ago. China is a very peaceful nation. China cares about its own economic development and the well-being of its citizens. There’s a lot of friction where China feels the United States is trying to contain China and stop its rise economically.

13:00 Sacks responds: Professor Mearsheimer explained that the US and China are in a high-tech competition, security competition, economic competition. The US doesn’t tolerate peer competitors. We want to be number one. We live in an anarchic world where you can’t call 911. Countries privilege their survival. You measure power based on the gap between you and the next most powerful country. 20 years ago China wasn’t seen as a threat because it wasn’t rich and powerful, but now it is. I want the US to be the most powerful country. In my little part of the world, that means winning the AI race.

15:00 Tsai responds: I think it’s really important that as a patriotic American, you want America to win. But when it comes to AI, there’s no such thing as winning the race. It’s a long marathon. Every week there’s a model that’s leading but the next week another overtakes it. AI doesn’t have winner-take-all network effects. My definition of winning is not who comes up with the strongest model, but who can adopt it faster. A lot of resources should go into adoption and diffusion of the technology.

17:00 China has espoused open source. Companies including ourselves have launched models that are smaller, not trillion parameter models, but 1.7 billion, 4 billion, 8 billion for mobile devices and laptops. With these smaller models, it’s more conducive to faster adoption. You want AI to proliferate. China is not technologically winning the model war, but in terms of actual application and people benefiting from AI, it has made a lot of development.

19:46 What’s the practical application of AI inside Alibaba? AI has definitely made our operations more efficient. We actually don’t have to hire as many people. I’m on this mission to write our quarterly earnings release with AI and maybe have a model on the analyst conference call. The biggest impact AI has made is incorporating it into all our consumer-facing apps: e-commerce, maps, food delivery. Once you infuse AI, the consumer has a massively better experience and that generates more user base for us. We’re seeing uplift on the revenue side.

20:30 Is the workforce naturally attriting? We haven’t announced any layoffs because of AI but I keep asking our engineering leads how much code is written by AI today. The answer is all over the map depending on which department, but I think it’s maybe 30% already, doing a weighted average across the different departments.

21:52 Alibaba is an enormous business in so many countries. How do you build a culture? Focus. I came back into the chairmanship about a year and a half ago. The first thing I said is we can’t talk about our company as being in six different businesses. It’s just too confusing. We’re in two businesses: e-commerce and cloud computing with an AI element. Having that focus was absolutely crucial.

22:30 Forecast for the Nets? We’re in a rebuilding year. We’ve spent all of our picks. We had five draft picks this past summer. We have one pick in 2026 and we hope to get a good pick. We have a very young team.

23:17 What’s the climate in China regarding AI and job displacement? The government is all in, embracing it. They just launched an AI plus policy saying that by 2030, 5 years from now, they want to see 90% penetration of AI agents and devices in society. There’s not a lot of talk about AI replacing human jobs. But there is an anxiety about jobs generally. China graduates about 10 million college graduates every year. Youth unemployment for ages 16-24 is 18%. Partly because the economy has gone through four or five years of a property slump. Average home prices are down like 30%, creating a very negative wealth effect.

25:00 Is there any fear of AGI in China? People in government don’t talk about it too much because they believe they could control it better than in the US. There are some lingering fears. But if Denny is saying 5 to 10 years, I think AGI is probably 20 years from now because the emphasis is on the word general. Your AI has to be able to generalize and apply principles to scenarios you’ve never seen before.

26:30 Joe, thank you very much. Great to see you. Thank you. Pleasure.