Zhang Yiming announced he would step down as CEO of ByteDance, owner of TikTok, claiming he lacked the social skills to be an ideal manager and appointing his roommate Liang Rubo as his successor to navigate the rising tide Big Tech regulations.
In a surprise employee announcement Thursday, first reported by Reuters and then disclosed by the company, Zhang said the change would allow him “to have a greater impact on longer-term initiatives.” He will move to a âkey strategyâ position at the end of the year, ByteDance said.
The 38-year-old will be replaced by Liang, a longtime colleague and current head of human resources at ByteDance, one of the world’s largest private tech companies with an estimated value of around $ 300 billion in trades. recent.
The leadership upheaval – the biggest for ByteDance since its launch in 2012 – comes as Chinese regulators increasingly monitor the nation’s biggest tech companies. Read more
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Zhang, who turned ByteDance into a social media force, said he was actually not a social person.
He blamed the daily challenges of a CEO as a barrier to research and innovation, while calling Liang an “invaluable partner” with “strengths in management, organization and social engagement.” .
âI’m more interested in analyzing organizational and market principles, and using these theories to further reduce management work, rather than managing people,â wrote Zhang, who will remain in his role. of president, in the note.
“Likewise, I am not very social, preferring solitary activities like being online, reading, listening to music and contemplating what is possible.”
In an internal memo seen by Reuters, Liang – also 38 – said the new role presented a “huge challenge” with “a lot of pressure”.
Liang, who was not a household name in China, shared Zhang’s room at Nankai University in Tianjin, China. He also worked with him on the real estate website 99fang.com before joining ByteDance. Liang on his LinkedIn profile says he is a co-founder of ByteDance.
‘WISE AND NECESSARY CHOICE’
Technical consultant Zhou Zhanggui said ByteDance is facing a slowdown in the growth of its core business in China and needs to reinvent itself.
“If these issues cannot be resolved, there is a strong possibility that the company will experience major setbacks in the future. I think Zhang’s choice is wise and necessary, whether his decision is made actively or passively.”
The announcement comes less than a month after Bytedance CFO Shouzi Chew became CEO of the flagship short video app TikTok. That post came to being won when Kevin Mayer, a former Disney executive, left after three months while TikTok was embroiled in a dispute between Washington and Beijing.
Zhang owns 20% to 30% of ByteDance and owns more than 50% of the voting rights, people with knowledge of the matter have previously told Reuters. ByteDance has not commented on Zhang’s participation.
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 over the next six months to ensure a smooth transition.
“Based on the previous experience, it is likely that we could see a slowdown in investment in new companies, when they could pay more attention to old companies because the new management team needs a little time to adjust, âsaid Shawn Yang, managing director of Blue Lotus Capital Advisors.
ByteDance, which employs more than 100,000 people worldwide, was preparing for a much-anticipated IPO this year, but halted plans in April.
âI think it is possible that Zhang is worried that after the IPO he will see an increase in his wealth and get a lot of media attention. It is difficult to be a rich person in China. You donât ‘not get as much recognition,’ said Li Chengdong, Beijing-based technology analyst.
Zhang is the latest in a small group of founders of Chinese tech companies to step away from day-to-day management.
Colin Huang, founder of e-commerce company Pinduoduo Inc (PDD.O), stepped down as managing director in 2020 and chairman in March. The 41-year-old, who owns around 30% of Pinduoduo, will also give up his super voting rights. Read more
ByteDance’s previous great organizational upheaval occurred last year, when Zhang appointed Zhang Lidong as chairman of the Chinese company of ByteDance and Kelly Zhang as CEO.
TikTok has sought to distance itself from Beijing after the United States raised national security concerns over the security of the personal data it processes.
The administration of former US President Donald Trump has sought to force ByteDance to cede control of the app. A US plan to sell TikTok’s US operations to a consortium that included Oracle Corp (ORCL.N) and Walmart Inc (WMT.N), however, was halted after ByteDance launched successful legal challenges.
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