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Richard Liu

Richard Liu

Founder of JD.com
Richard Liu
The basics

Quick Facts

Intro Founder of JD.com
Education
People’s University of China Sociology
The details

Biography

Richard Liu who also goes by the name Liu Qiangdong, is a Chinese billionaire entrepreneur and businessman. He is the founder, chairman, and chief executive officer of the e-commerce website JD.com. It is the largest retailer in China and the third largest internet company by revenue in the world. Liu has been named “2011 China Economic Person of the Year” by CCTV, Fortune China’s “2012 Chinese Businessman,” and number 48 in Fortune’s list of the world’s greatest leaders.

Early Life and Education

Liu was born on March 10th, 1973 in Chang’an, a small village in the northern Jiangsu province of China. Although in the early 1900s his family were wealthy shipowners who transported goods along the Yangtze river, when communism took a hold of the country they lost everything and had been forcibly resettled twice by the time Liu was born. The village he grew up in lacked most modern day conveniences including electricity and running water, and like most in the village his parents farmed the few rice fields they owned to get by. 

While his parents tended the rice fields, Liu was often left in the charge of his maternal grandmother. He would often help her cook the meals for the family: cornmeal porridge, corn pancakes and cornbread in the spring and summer, boiled sweet potato, sweet potato pancakes, and dried sweet potato in the fall and winter, and on the very rare special occasion they would eat pork. Once or twice a year, he would accompany his grandmother to the farmer’s co-op where she would bribe the vendor with peanuts to give her a fatty cut of the meat. After they cooked the meat, his grandmother taught him to carefully save the flavorful fat to cook with for the rest of the year, and Liu suggested they also wash the pots with hot water and save the liquid for soups as well. Liu’s childhood dream was to become a village head so he could see that everybody in the village had pork.

As a child, Liu was consistently searching for new opportunities to learn. In primary school, he heard the government building in nearby Lailong had installed electricity. After school one day, he led his classmates on an excursion to see it, and they all observed a working light bulb for the first time. While attending middle school in Suqian, the closest nearby city, he decided to take a trip during a school holiday. With the seven dollars he had saved, he traveled by car to Xuzhou and then by train to Nanjing, a city with double the population of Suqian. It was the first time he comprehended bigger cities existed, and he walked around a 37-foot skyscraper in wonder. 

After his trip, Liu decided he wanted to live in a city even bigger than the one he visited, and so when his time at Suqian Middle School was coming to an end, he only applied to universities in Shanghai and Beijing. Liu had excelled in school, and he earned high marks on the National College Entrance Examination (NCEE) leading him to be accepted to Renmin University, also known as the People’s University of China in 1992. His family did not have enough money to pay for the 600km train trip from Lailong to Beijing, and so the other members of his village pitched in to come up with the $75 for the ticket. They also made sure he had enough to eat by providing him with eggs for his trip, and he ended up with 76 eggs that sustained him not only on his whole train ride, but for a week in Beijing after. 

Initially thinking he may enter into politics, Liu decided to pursue a degree in sociology. However, he found the coursework for the degree to be unchallenging and ended up with a lot of free time on his hands. He got a job at a small business that couldn’t afford a photocopier handwriting copies of letters and documents, but he was still left with considerable time and decided to learn computer programming as well. In the late 1980’s and early 1990’s capitalist reforms to the centrally planned communist economy had begun to take hold, and by learning programming in that timeframe Liu made himself a valuable asset for the many burgeoning businesses in need of his skills. He quickly made enough money to purchase his own computer, cell phone, and build a new house for his parents, all while still in college. He continued to build a considerable savings as well, and used it to open a restaurant near the entrance of his school. However, his lack of management skills and naivete led to his employees taking advantage of him, stealing money from the till and forging reimbursement receipts until he was run out of business in less than a year. Nonetheless, it was a valuable lesson for him, and after graduating college and spending another two years gaining experience working at a Japanese company before beginning his next venture. 

Entrepreneurial Ventures 

In 1998, Liu rented a small booth in an electronics market in Zhongguancun and began selling magneto-optical drives. Among the many booths selling counterfeit items at what has today become known as “China’s Silicon Valley” Liu only sold verifiably authentic products, and refused to haggle. This strategy set him apart from other booths in the technological hub, and the business grew beyond the single stall to 12 full-size retail locations across Beijing, Shanghai, and Shenyang in just five years. Liu never intended to take his business online and planned to continue expanding retail locations, but in 2003 the SARS epidemic spread throughout China, wreaking havoc on the economy as people stayed inside to prevent the spread of the virus. In that time, Liu could not generate enough business to keep the shops open and was forced to temporarily shutter all 12 locations. In an effort to continue earning revenue and moving product, Liu began posting his items to online bulletin boards. He initially had little success, but after a former customer identified him online and vouched for the quality and price point of his goods he gained traction and kept his business afloat. 

After the epidemic ended and people began leaving their homes again Liu reopened all of the stores, but he retained one employee full-time to continue selling their products online. Upon reviewing the numbers after operating both the retail locations and online for a year, it became clear to him that his online sales were increasing at a rate that would quickly overtake retail. He made the decision to move his company exclusively online, and in 2004 he started jdlaser.com and closed all of his retail locations. Liu wrote the code for the initial website himself, and also spent countless hours in the first four years of the business answering the customer service questions himself to better understand the wants and needs of his clientele. In 2005, he received an offer to buy his company for $2.5 million USD, but he rejected the offer. 

In 2007, although the company had expanded its offerings to a wide variety of electronic goods and was operating as a successful e-commerce business, Liu began plans to broaden its logistical network considerably. His goal was to improve customer experience and broaden its reach into previously difficult to reach third and fourth tier cities by managing every step of the supply chain from warehouse to customer doorstep. Also in 2007 he also changed the name of the website to 360buy.com to reflect their expanding offerings, and in 2010 opened an online bookstore that soon also carried CDs, DVDs, and e-books. 

In March 2013, the company had scaled considerably and officially became JD.com. By May 2014 when the company went public on the United States stock market, it had over 3000 delivery and pickup stations in almost two thirds of China’s counties. On the day of JD’s public offering, stock prices for it rose 15%. As time has passed, advanced technology has become an increasingly important part of Liu’s business model for the company, and they have heavily invested in AI and drone technology as vital aids to completing deliveries. Today, the website has annual revenues of $82.9 billion USD, over 360 million active customers annually, and over 700 warehouses across China.

Philanthropy

In 2008, Liu volunteered as part of Red Cross efforts and drove to Pingwu County to help the victims of the Sichuan earthquake.

In 2018, Liu was ranked number nine on Forbes China Philanthropy List for his total yearly donation of 533 million yuan. This included 200 million yuan to Tsinghua University for research into artificial intelligence, logistics, and other fields.

In 2020, Liu’s company JD.com has been instrumental in the ongoing Covid-19 pandemic. The company opened a dedicated relief channel for coronavirus-related aid materials from all over the country and have delivered over 15 million items equating to 1,600 tons of medical emergency materials to Wuhan since the Chinese New Year. In response to the Hubei provincial government’s request for assistance in conducting their supply chain, they built a platform to help manage emergency supplies and ensure its timely delivery to the hospitals and clinics where it is needed most. They have also been providing their delivery services to pharmaceutical companies in the Hubei province. They have donated over 100 million medical masks, as well as 60,000 units of medicine and medical supplies to the Hubei Charity Foundation, and have also donated an additional 80,000 masks, 2,000 sets of feminine care products and nearly 630,000 adult diapers to various hospitals in Wuhan. 

 

 

 

 

 

 

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Reference sources
References
Bloomberg
https://www.bloomberg.com/billionaires/profiles/qiangdong-liu/
Variety
https://variety.com/exec/richard-liu/
JD.com Bio
https://corporate.jd.com/richard-liu-jd-ceo-about
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