Today is certainly cruel for Alibaba Holding Co's (BABA) - Get Report investors. But what about tomorrow and the day after tomorrow?

Jack Ma, the billionaire co-founder of China's e-commerce powerhouse, once famously said words to that effect in describing the challenges of building up a significant business ("Today is cruel. Tomorrow is crueler. And the day after tomorrow is beautiful," were his exact words)

Ma clearly had a workman-like approach to building what has become one of the largest companies in the world. But he still kept his eye on the future even as he began clearing a path for his ultimate successor.

Watching the market reaction to news of his departure from the company he built from an apartment in the city of Hangzhou to one that is now worth nearly half a trillion dollars, Ma certainly seems to have at least a portion of that famous observation correct: Alibaba's U.S.-listed shares slumped more than 3% in morning trading in New York on Monday.

That represented their lowest level in more than a year, as investors began to ask some very serious questions over the fate of a company that is at once deeply rooted in the personality of its founder while simultaneously tied to an economy that could be facing its most serious crisis.

Ma, who will remain on the Alibaba board until 2020, will hand the position of executive chairman to current CEO Daniel Zhang, who has largely steered the group's international expansion since taking over as CEO in 2015. Zhang, 46, is relatively unknown to many investors, but has led the group's investor conference calls for a number of years and is credited with the creation of the company's 'Single's Day' sales that is now the world's biggest annual online shopping event, raking in more than $25billion in sales on a single day last November.

Zhang's new leadership role, however, comes at what could be a time of profound change for both the global tech industry and his country's economy, presenting a challenge that is far deeper than simply replacing a legendary corporate leader.

The Chinese government considers ICT (information and communications technology enterprises) as part of a "strategic sector" that will drive economic growth over the next ten years, as well as one in which it has invested significant state capital and influence on behalf of state-owned companies.

Seeing individual company owners such as Ma amass personal fortunes estimated to be as much as $36 billion has always sat uncomfortably within the higher-reaches of the People's Congress. But the charismatic Ma has managed to appease both envious political rivals and foreign regulators alike with his disarming personality and plain-spoken manner.

How that approach will change once Ma departs for good in 2020 remains to be seen, but what little we know about Zhang suggests he's not ready to assume the mantle of "spokesperson in chief" for a Chinese tech industry that's run afoul of the White House amid allegations of intellectual property theft and unfair barriers to entry for foreign rivals.

That alone is a significant risk to a business model that is growing increasingly reliant on cloud computing revenues from sales to both domestic and foreign firms alike, at a time of rising concerns over the safety and security of data stored on China-based servers and the intrusive instincts of officials in Beijing.

President Donald Trump's targeting of China in his escalating global trade war is another major risk, particularly given China's insertion into the global tech supply chain and the reliance on so many American firms -- including Apple -- on the mainland factory floors. With the spectre of tariffs targeting more than $500 billion in China-made goods hovering over the economic landscape, and increasing signs that second-half growth prospects are slowing materially in the face of Trump's 'Buy American' onslaught, the power and confidence of the Chinese consumer -- a crucial driver of Alibaba's advance -- is not nearly as compelling as it was when Ma began planing his succession a year ago.

That's already on display the country's volatile stock markets, which have helped push the tech-focused CSI 300 to a year-to-date decline of around 19.8%, led by vicious sell-offs for giants such as Tencent Holdings (TCEHY) , the operator of the billion-strong WeChat messaging platform, Baidu (BIDU) - Get Report and (JD) - Get Report . The CSI Overseas China Internet Index, a sector benchmark tracked by U.S. investors, is down 14.5% so far this year, and has plunged more than 23% since Trump began ramping up his anti-China rhetoric in June. 

"When you are small, you have to be very focused and rely on your brain, not your strength," Ma said of his early days building Alibaba.

With a current market cap of $400 billion, a workforce of 66,000 and quarterly revenues of $12.3 billion, Alibaba is certainly no one's definition of "small." But the question now, with Ma planning to relinquish an active role in running the company soon, is whether it will remain strong. 

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