(Bloomberg Opinion) — Ensconced in a profitable area of interest at dwelling, Jack Ma’s Ant Group nonetheless has to look outward. And increasing abroad has by no means appeared so troublesome for China’s largest funds app, even with the battle chest from what may be a world-record preliminary public providing.Ant can have no issues elevating the $30 billion it’s looking for on this mega-IPO. Few traders will go up the prospect to purchase into the proprietor of Alipay, a super-app that gives entry to all the pieces from insurance coverage and funds to loans and even groceries. For U.S. establishments, the lure of the world’s most respected unicorn is more likely to overshadow the specter of additional motion towards Chinese language firms by President Donald Trump, who has already issued government orders focusing on Tencent Holdings Ltd.’s WeChat, Alipay’s largest home rival.China gross sales account for about 95% of Ant’s income. But abroad enlargement is destined to turn out to be extra necessary to the corporate. Ant is already so massive and dominant at dwelling that its progress inevitably will gradual. It additionally faces intensifying competitors in China, not solely from WeChat and different expertise rivals however from international monetary corporations comparable to American Specific Co., which in June turned the primary abroad funds community to be allowed to begin processing native foreign money transactions. The actual killer app may come from Beijing, which is testing a digital yuan that can provide all of the comfort of digital cash.Tighter regulation may additionally weigh on Ant’s capacity to develop in China. For all the corporate’s makes an attempt to rebrand itself as a expertise agency (a extra frivolously regulated trade), it nonetheless appears to be like extra like a financial-services enterprise, as my colleagues Shuli Ren and Anjani Trivedi have written. The corporate’s Yu’E Bao money-market fund, which grew to turn out to be the world’s largest, has already had its wings clipped by Beijing’s monetary watchdogs. A fast trawl by way of Ant’s 674-page prospectus exhibits simply how a lot consideration this situation is consuming: “Regulation” seems virtually 500 instances.In opposition to this backdrop, Ant recognized cross-border enlargement as one of many 4 makes use of for its IPO proceeds. The corporate intends to reinforce its worldwide cost capabilities, spend money on expertise and develop extra digital cost, finance and daily-life companies for shoppers, retailers and companions past China, in response to the submitting.Tourism has been key to the extending attain of Alipay and WeChat Pay. China was the world’s largest supply of abroad vacationers in 2018, and likewise the world’s largest spender, driving elevated acceptance of the Chinese language cost apps in cities from Paris to Bangkok. Put up-IPO, Ant faces a dramatically modified surroundings, with the Covid pandemic having despatched the worldwide vacationer trade into chilly storage.Geopolitics, in the meantime, was an issue for the corporate even earlier than U.S.-China tensions reached cold-war ranges. In early 2018, Ant scrapped its takeover of MoneyGram Worldwide Inc. after the U.S. raised nationwide safety issues. The corporate additionally backed out of a promise to create 1 million jobs within the U.S., with Ma blaming the commerce spat between the international locations. The IPO submitting devotes three pages to geopolitical dangers, most centered on the U.S. Not like its shareholder Alibaba Group Holding Ltd., Ant determined towards promoting shares in New York, opting as an alternative for a twin Hong Kong and Shanghai itemizing. It nonetheless may be uncovered to potential future U.S. sanctions, although.For the reason that MoneyGram deal collapsed, the corporate has primarily targeted on its Asian yard. Even right here, progress faces hurdles. India banned dozens of Chinese language apps in June, following a border conflict. Alibaba’s UC Browser was banned, although Ant-invested Paytm has escaped sanction. Southeast Asia, the place cellular funds and bank card penetration are comparatively low, provide extra alternatives, although homegrown competitors from the likes of Singapore’s Seize and Indonesia’s GoJek is on the rise.A quick-growing enterprise with 1 billion clients and a seat at the innovative of economic expertise is creating comprehensible pleasure. Traders ought to mood that with a recognition that Ant’s future may be loads tougher than its previous. This column doesn’t essentially mirror the opinion of the editorial board or Bloomberg LP and its homeowners.Nisha Gopalan is a Bloomberg Opinion columnist protecting offers and banking. She beforehand labored for the Wall Street Journal and Dow Jones as an editor and a reporter.For extra articles like this, please go to us at bloomberg.com/opinionSubscribe now to remain forward with essentially the most trusted enterprise information supply.©2020 Bloomberg L.P.