ByteDance founder hands CEO’s reins to college roommates

Zhang Yiming has announced that it will resign as CEO of ByteDance, the owner of TikTok. He lacked the social skills to become an ideal manager and nominated his college roommate, Liang Rubo, as his successor to survive the rise in big tech regulation.

In a surprise announcement to employees on Thursday, first reported by Reuters and later disclosed by the company, Mr. Zhang said the change could “make a greater impact on long-term initiatives.” According to ByteDance, he will move to a “major strategy” position at the end of the year.

38-year-old Liang will be taken over by her longtime colleague and current HR manager at ByteDance, one of the world’s largest private technology companies with an estimated value of approximately $ 300 billion in recent transactions.

Management turmoil (ByteDance is the largest since its launch in 2012) is occurring as Chinese regulators increase scrutiny of the country’s largest tech company.

In April, they fined e-commerce giant Alibaba Group Holding Limited $ 2.8 billion for anti-competitive practices and stopped the initial public offering (IPO) of fintech affiliate Ant Group last year. Did.

Antitrust regulators also told Tencent Holdings Ltd. that they are preparing to fine the game giant as much as $ 1.55 billion, Reuters reported last month.

Zhang, who turned ByteDance into the power of social media, said he wasn’t really a member of society.

He accused the CEO of his day-to-day challenges as a hurdle to research and innovation, calling Liang an “irreplaceable partner” with “strength of management, organization and social involvement.”

“I’m interested in analyzing organizational and market principles and using these theories to further reduce management effort, rather than actually managing people,” said Zhang, who continues to serve as chairman. I am writing in a memo.

“Similarly, I’m not very sociable and prefer lonely activities such as being online, reading, listening to music, and thinking about what’s possible.”

In an internal note seen by Reuters, Liang, also 38, said the new role represents a “huge challenge” with “great pressure.”

Liang, who lived with Zhang at Nankai University in Tianjin, China, is not a common name in China. He also worked with him on the real estate website before joining ByteDance.His beam LinkedIn profile He said he was the co-founder of ByteDance.

“Wise and necessary choice”

Technical consultant Zhou Zhanggui said ByteDance is facing slowing growth in its core Chinese business and needs to reform itself.

“If we can’t solve these problems, the company is likely to face a major setback in the future. I think Zhang’s choice is wise and necessary, whether his decision is active or passive. . “

The announcement came less than a month after Bytedance’s Chief Financial Officer, Shouzi Chew, became CEO of flagship short video app TikTok. The post was acquired when former Disney executive Kevin Mayer left three months later as TikTok was caught in spats between Washington and Beijing.

Zhang previously told Reuters that he owns 20-30% of ByteDance and more than 50% of his voting rights. ByteDance did not comment on Zhang’s investment.

The founder said he would start discussions with a small group in March about the possibility of appointing Liang as a successor and will work with him over the next six months to ensure a smooth transition.

Sean Yang, Managing Director of Blue Lotus Capital Advisors, said: ..

ByteDance, which employs more than 100,000 people worldwide, was preparing for the long-awaited IPO this year, but canceled the plan in April.

“I think Zhang may be worried that he will get a lot of media attention after seeing the wealth swell after the IPO. It’s hard to get rich in China. It hasn’t been done, “said Beijing-based technology analyst Lee Chengdong.

Sino-US tension

Zhang is the latest in a small group of founders of Chinese tech companies, away from day-to-day management.

Colin Huang, the founder of e-commerce company Pinduoduo Inc, resigned as Chief Executive Officer in 2020 and Chairman in March. The 41-year-old, who owns about 30% of the many balls, will also waive his super-voting rights.

ByteDance’s previous major organizational turmoil arose when Zhang appointed Zhang Lidong as chairman of ByteDance’s China operations and Kelly Zhang as CEO.

TikTok sought to stay away from Beijing after expressing national security concerns about the security of personal data handled by the United States.

The United States under the Trump administration tried to get ByteDance to take control of the app. However, after ByteDance succeeded in legally appealing, TikTok’s US operations were expanded to Oracle Corp and Walmart Inc. The US plan to sell to a consortium that includes, was sluggish.

By Echo Wang and Yingzhi Yang

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