On Friday morning, Tom Farley arrived at the New York Stock Exchange at 7:20 am ET, just like he does every day. And then, for a couple of seconds, he acted like a tourist.
Alibaba founder Jack Ma and his executive team were posing for photos in front of the historic building. Behind them, the building’s pillars were draped with Alibaba’s banners. In a few hours, Ma and Alibaba would cap off a $21.8 billion IPO, the biggest in the exchange’s history, with a first trade that valued the company at more than $200 billion.
So Farley, the 38-year-old who runs the exchange, took out his phone and snapped a few pictures himself. “When I came around the corner, I was just really proud to see that,” Farley said in an interview on Friday. “That was the highlight of my day.”
Landing Alibaba will mean more for Farley and NYSE than a few souvenir photos. The exchange will rake in millions in listing fees from Alibaba over time. Perhaps more importantly, it’s a shot across the bow at Nasdaq, as the two markets compete furiously for big tech IPOs that bring gobs of attention and trading volume to the winning exchange. After losing out on the Facebook IPO, the NYSE now has won listings for Twitter and Alibaba.
It’s also a pretty good start for Farley at the top job, which he’s only had for four months. He was previously NYSE’s chief operating officer and, before that, held executive roles with IntercontinentalExchange before it acquired the NYSE. I talked to him at length a few days before Alibaba’s IPO about what the historic event means for the exchange and how it won the battle with Nasdaq. Here’s an edited version of our conversation.
Re/code: Where were you when you found out that Alibaba had chosen your exchange?
Farley: I was at home in the West Village and we found out early in the morning. They called us to let us know they were going to let Nasdaq know that day.
Was it a giant relief?
We were fairly confident all along but not overly confident. We were competing very hard to get the business. When we looked at Alibaba’s considerations for choosing a listing venue, we felt like objectively we were the right venue for them. Yes, it was a celebratory moment but it wasn’t one of those incredible celebrations borne of surprise or great relief. It was the general excitement of working with a great company.
What was the pitch?
We generally, and also in the case of Alibaba, pitch a number of characteristics. In this case I’ll reference four.
One, there’s a branding benefit of being a listed company on the New York Stock Exchange … which stands for well-governed successful companies. Two, we have earned a reputation for delivery of high-quality technology and services. Three, there’s a very good media benefit for a company like Alibaba or others that could benefit from doing an initial listing here in this iconic stock exchange. Four, we have what we call a market maker model. The way we open stocks on that initial day is we combine tech sophistication with humans who can make really good rational decisions. If something is unstable with the composition of the book, there’s a human who can step into the breach. That’s very attractive. It’s very expensive for us to maintain that model, but it’s worth it.
What was the most critical characteristic for why Alibaba picked your exchange?
I’d rather let them answer that, but there’s a reason I mentioned the characteristics I did.
How was the preparation different for this IPO than for others?
Prep was not really different than other IPOs. Saturdays are work days here where we do non-production tests. We did three tests in advance. Two of them were broad-based industry tests where we ran what I call mock IPOs and those were well-attended and went well.
How important is Alibaba’s listing to your efforts of attracting more tech stocks?
Flash back a decade and the New York Stock Exchange was winning very few if not any tech listings. Now we’re winning around two-thirds of what we call “qualified deals.” And that momentum had picked up pace prior to Facebook (which listed on Nasdaq), continued after Facebook and continued after Alibaba made their decision. And we hope it will continue to.
It’s very important Alibaba picked us because it’s a great company and certainly brings a lot of publicity to the exchange and we’re thrilled for that reason. But it’s a continuation of a trend; it itself is not an inflection point per se.
What’s Jack Ma like?
I will tell you that I’ve worked with the Alibaba team and I was out last night with a subset of the team — not Jack Ma — and they are very professional, very deliberative and rigorous, both in the exchange selection process as well as the planning process characterized by attention to detail and extreme thoughtfulness. They are also good fun guys that I like to be around. From what I have seen, they have a culture that attracts good people.
This article originally appeared on Recode.net.