Alibaba (BABA  ) affiliate, Ant Financial is rebranding to Ant Technology Group and changing its focus as well. It's currently the largest fintech company in China and has already filed and received approval from regulators for the name change. Ant Financial is a spin-off of Alibaba with the parent company retaining 33% ownership.

Ant Technology doesn't see itself as a financial company, instead, a company spokesman said Ant is "an innovative global technology provider" and over 60% of its workforce is in technology positions. Ant Technology's most well-known product is AliPay.


Its first and major product is AliPay which began in 2004 as a part of Alibaba. It was the first online payment processor in China. From this AliPay has grown to include mobile payments, saving accounts, personal investing, lending, and credit scores as well as several B2B services and products. In essence, AliPay is an amalgam of Visa (V  ), Paypal (PYPL  ), Square (SQ  ), and a major bank.

AliPay started as a humble, side project for Alibaba to create a reliable payment system for its e-commerce platform. Alibaba followed the same path as Amazon (AMZN  ) which created two hundred billion-dollar businesses by solving its problems in cloud computing and logistics.

AliPay was a necessary creation to allow an online business to flourish in China. Once users were on its platform, features were slowly added to incentivize more activity including banking and investing. From there, AliPay branched out into selling financial products like insurance and asset management to users. Many younger users were more comfortable managing their finances on AliPay rather than a traditional bank.

Extraordinary Growth

Ant Technology was started in October 2014. By the end of 2015, it was valued at $45 billion. In 2018, it raised $14 billion from investors, a record amount, for a valuation of $100 billion. It remains a private company, but its value is estimated at $200 billion which makes it the most valuable private, startup in the world. It's in talks to go public, and most analysts expect it does so within the next year.

Although it's changed its name to Ant Technology from Ant Financial, the most important part of its name, "Ant" has not changed. Founder Jack Ma chose this name because his goal was to create a product that focuses on small, individual users.

This ethos is evident in all of Alibaba's major products which don't differentiate between users with large balances or small balances. For example, its money-market funds are available to users even with a single yuan in their account. Ma's focus is on growing with his users. So far, this strategy has been remarkably successful as indicated by its valuation. Ant Technology may become bigger than Alibaba over the next decade.