The discreet female attendants have brought a bottle of Bordeaux but we both decline. In its place arrives a thick mushroom soup covered by a crisp mushroom wafer served with sourdough bread and truffle butter. Richard, who eats little, gestures out the window at several large empty plots as he recalls the early days of the company. “I bought this land in 2009 because I thought sooner or later we would be a huge company.” In 2009, JD.com had barely 300 employees. Today it employs more than 120,000, including 65,000 delivery drivers and logistics workers. Using its own drivers ensures more than 90 per cent of its deliveries arrive the same or next day - an astounding statistic compared with the “two to five business days” offered by companies such as Amazon.
As I know only too well, online shopping has taken off so dramatically in China in part because of the frustrations of relying on traditional retail. In big cities, shopping frequently involves sitting for hours in traffic, bargaining relentlessly with shopkeepers who never display prices and discovering later your purchase is counterfeit or poor quality. Apart from the convenience of buying online, Alibaba has been so successful because it allows you instantaneously to compare prices on a national scale - though it has also faced criticism over counterfeit products on its platform. JD.com likes to contend it has succeeded because it sells “trust”. Like Amazon, it has built up a colossal warehousing system and also claims to be the world leader in testing drone delivery.
“When I was a kid, my parents always told me that business is trust and trust is business,” Richard says. “I have the full trust of the Chinese consumer.”
Like so many of the Chinese elite, Richard is rather more guarded when it comes to discussing his interactions with the ruling Communist party. These are difficult days for the country’s super wealthy as China’s president Xi Jinping presses on with his purge of potential rivals and the business leaders with close ties to them. Some of China’s wealthiest entrepreneurs have been arrested in recent months and the state-owned sector has steadily expanded at the expense of private enterprise. Richard is loath to discuss how he and other tech billionaires have managed to remain unscathed. But the fact that these online businesses are crucial for the “new economy” Mr Xi envisions must be partly behind their survival.
It’s only when he talks about his family and upbringing that he becomes more animated - particularly when I let him know I visited the area around his tiny hometown in the northern Jiangsu Province on a government propaganda trip more than a decade ago. His village is called Chang’an - “eternal peace” and falls under the jurisdiction of Lailongzhen - “town of the approaching dragon” - but the poetic names misrepresent this desolate part of the world. Virtually every Chinese millionaire or billionaire is self-made because capitalist reforms to the centrally planned communist economy only began in the early 1980s and did not really take off until the 1990s. But the modern super-wealthy often turn out to be descended from an earlier capitalist class. Richard is no exception. Before the 1949 revolution his family were wealthy shipowners who transported goods along the Yangtze river and the ancient imperial canal from Beijing in the north to Hangzhou in the south. They lost everything when the communists took over and were forcibly resettled at least twice. One academic survey found more than 80 per cent of Chinese “elites” (those with income at least 12 times higher than the average in their area) are descended from the pre-1949 elite. Richard puts this down to “family culture”.
“My parents and grandparents taught us a lot - not Chinese or maths but a sense of values, of how you should be and how you should treat others,” he says. They also drilled into him the knowledge they had once been very rich but everything had been taken away - a lesson all too relevant even now.
Once in Beijing as a young student, Richard knew he had to fend for himself. So when his egg supply ran out in his second week he landed a job writing letters by hand for a company that could not afford a photocopier. His degree was in sociology but he found the lessons simple and had a lot of free time. So he taught himself computer programming and began to make more money than he had ever dreamt of. By chance his arrival in Beijing in 1992 coincided with paramount leader Deng Xiaoping’s “southern tour”, which marked the wholesale shift to embrace capitalism and market reforms in the wake of the 1989 Tiananmen massacre. “Suddenly the whole society needed computer engineers but there weren’t any, so I got very rich and even bought a mobile phone - a Motorola like a big rock that cost me $4,000, a huge fortune,” he says. “I also bought a computer and built a new house for my parents in the village.”
With the money he earned from programming, he also started his first business, a restaurant near the entrance to his university. The venture ended in bankruptcy after just eight months.
“The cashier fell in love with the chef and they worked out how to steal from me and then all of the staff started stealing,” he says with a rueful laugh. “It was all my fault because I had no management skills and I was never there.”
Faced with big losses from the failure of his restaurant he worked for a Japanese company to learn about management and repay his debts. After two years he had saved Rmb12,000 and was able to start another business - a 4 sq metre shop counter in an electronics market that sold computer components. The year was 1998. Observing how most of his competitors earned money by cheating their customers, selling counterfeit or substandard goods and haggling over every sale, Richard decided to test a different strategy.
“I was the first and only stall in that market to put price labels on everything and give official receipts; from day one I never sold any counterfeits and I soon had the best reputation,” he says. “A lot of rich people in China cannot sleep well because they did too many wrong things but I never made any dirty money ever so I can sleep very well.”
By early 2003 his tiny stall had grown into a chain of 12 large electronics stores across Beijing. But then disaster struck - and his fortunes changed for the better. A pandemic known as severe acute respiratory syndrome (Sars) that would eventually kill 775 people worldwide broke out in southern China and quickly spread to the capital. The government’s attempts to cover up the calamity led to greater panic and Beijing became a ghost town. Richard closed all his stores but redeployed a handful of staff to offer products through online bulletin boards. The panic passed and his stores reopened, but he kept one person employed full time on the internet. At the end of the year he looked at sales numbers, realised e-commerce’s potential and decided this was his future.
“If it hadn’t been for Sars I’m sure I would still be rich and successful, but not hugely successful like today because the business model [of traditional retail] is not the best,” he says.
The fastest computer in his office belonged to the receptionist. He requisitioned it and made it into JD.com’s first server. He wrote the initial code for the website himself and he lived in his office so he could answer questions from online customers at any time of day.
“I bought an old traditional alarm clock and I put it on a wooden floor so it was like an earthquake waking me every two hours - I’d get up and answer questions online and then sleep for another two hours and then get up again,” he says. “In the first four years it was just me doing customer service and it was very good for me because I learned every detail of what our customers wanted.” He has literally lived in his offices for a decade - even as they have become increasingly luxurious.
The salmon has been replaced by roasted rack of lamb with slow roasted carrots, ricotta and quinoa but Richard is restless. He orders the attendant to cancel the dessert of “monk’s head” Swiss cheese and brioche with candied hazelnuts and poached apples. In all this time he has barely touched his food and is itching to leave. But before he leaves there is something I really want to know - now he can eat whatever he wants does he prefer corn or sweet potato?
“I hate them both,” he says and heads off to make more money in surely the most exciting, fast-growing and perilous business environment on the planet.