The CEO of ByteDance retires, chooses university roommate as successor | Business and Economy News


Zhang Yiming announced his resignation as CEO of TikTok owner ByteDance, saying he did not have the social skills to be an ideal manager and appointed his roommate Liang Rubo as his successor to sail in a growing tide of major technology regulations.

In a surprise announcement to employees on Thursday, first reported by Reuters news agency and later reported by the company, Zhang said the change would allow it to “have a greater impact on long-term initiatives.” It will move to a “key strategy” position by the end of the year, ByteDance said.

Liang, a longtime partner and current head of human resources at ByteDance, one of the world’s largest private technology companies, has an estimated value of about $ 300 billion in recent business.

The agitation of management, the most important of ByteDance since its launch in 2012, comes as Chinese regulators are increasingly examining the country’s largest technology companies.

In April, they fined e-commerce giant Alibaba Group Holding Ltd $ 2.8 billion for anti-competitive practices and last year suspended Ant Group’s initial public offering (OPO) affiliated with fintech technology. .

Among the business titans that have been subjected to greater control by Chinese regulators is Jack Ma, president of Alibaba Group Holding Ltd [File: Bloomberg]

Antitrust regulators have also informed Tencent Holdings Ltd that they are preparing to fine the gaming giant up to $ 1.55 billion, Reuters news agency reported last month.

Zhang, who turned ByteDance into a social media force, said he wasn’t really a social person.

He accused the day-to-day challenges of a CEO as an obstacle to research and innovation, while calling Liang “an invaluable partner” with “strengths in management, organization and social commitment.”

“I am more interested in analyzing organizational and market principles and leveraging these theories to further reduce management work, rather than effectively managing people,” wrote Zhang, who will continue to serve as chair.

“Similarly, I’m not very social. I prefer solitary activities like being online, reading, listening to music and contemplating what might be possible.”

In an internal note seen by Reuters news agency, Liang, also 38, said the new role posed a “huge challenge” with “a lot of pressure.”

Liang, who was not a famous name in China, stayed with Zhang at Nankai University in Tianjin, China. He also worked with him on the real estate website before joining ByteDance.

Liang, on his LinkedIn profile, said he is a co-founder of ByteDance.

“Wise and necessary choice”

Technical consultant Zhou Zhanggui said ByteDance was facing a slowdown in the growth of its main business in China and needed to reinvent itself.

“If these problems cannot be resolved, it is very possible that the company will face major setbacks in the future. I believe Zhang’s choice is right and necessary, regardless of whether his decision is made actively or passively. Zhou said.

The announcement comes less than a month after ByteDance chief financial officer Shouzi Chew became CEO of the flagship short video app TikTok. This post came to light when Kevin Mayer, a former Disney executive, left after three months when TikTok was embroiled in a dispute between Washington and Beijing.

TikTok has tried to distance itself from Beijing after the United States raised national security concerns about the security of the personal data it handles. [File: Dado Ruvic/Reuters]

Zhang owns between 20 and 30 percent of ByteDance and has more than 50 percent of the voting rights, people with knowledge of the subject have previously reported to Reuters news agency. ByteDance made no comment on Zhang’s involvement.

The founder said he started a discussion with a small group of people in March about the possibility of appointing Liang as his successor and that he will work with him for the next six months to ensure a smooth transition.

“Based on previous experience, we are likely to see a slowdown in investment in new companies, while they could pay more attention to old companies, as the new management team needs some time to adjust,” he said. Shawn Yang, CEO of Blue Lotus Capital Advisors.

ByteDance, which employs more than 100,000 people worldwide, had prepared for a long-awaited IPO this year, but halted plans in April.

“I think Zhang might be worried that after the IPO he saw an increase in his wealth and received a lot of media attention. It’s hard to be a rich person in China. You don’t get that much recognition.” , said Li Chengdong, a Beijing-based technology analyst.

US-China tensions

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

Colin Huang, founder of e-commerce firm Pinduoduo Inc., resigned as CEO in 2020 and as chairman in March. The 41-year-old, who owns about 30 percent of Pinduoduo, will also relinquish his super-voting rights.

The previous big organizational shake-up of ByteDance came last year when Zhang appointed Zhang Lidong as chairman of ByteDance’s Chinese business and Kelly Zhang as CEO.

TikTok has tried to distance itself from Beijing after the United States raised national security concerns about the security of the personal data it handles.

The administration of former U.S. President Donald Trump tried to force ByteDance to divert control of the application. A U.S. plan to sell TikTok’s U.S. operations to a consortium that included Oracle Corp. and Walmart Inc. disappeared, however, after ByteDance launched successful legal challenges.

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