ByteDance is primarily known as the developer of the popular video-sharing social networking service Douyin, which is the Chinese version of TikTok.
- In an open letter to his employees on May 19, ByteDance founder and chief executive officer Zhang Yiming announced he is stepping down as CEO.
What is ByteDance?
- ByteDance is primarily known as the developer of the popular video-sharing social networking service Douyin, which is the Chinese version of TikTok.
- In his letter, Zhang expressed a desire for the company to pursue other business opportunities and for ByteDance to expand beyond just social media platforms.
- Some of the new opportunities ByteDance has been looking to possibly invest in include “exploring new initiatives in education, brain disease research and digitizing ancient books.”
- In March 2016, ByteDance established a research branch of a company called AI Lab that aims to create innovative new ways for AI software to learn and develop.
- The company recently announced plans to move into e-commerce, which would make it a competitor to Jack Ma’s Alibaba.
Why is Zhang stepping down?
- With ByteDance looking to go public, many critics are confused as to why Zhang would choose this time to step down since his company is expected to have a market cap of around US$250 billion.
- To put that into perspective, the largest initial public offering (IPO) of all time was when Alibaba went public at US$21.8 billion.
- Tim Culpan, a writer for Bloomberg, pointed out that Zhang’s timing might be in response to the increased scrutiny the Chinese government has paid billionaires in the country. “You can possibly get away with being rich, or being powerful, but certainly not both,” Culpan wrote.
- In his letter, Zhang said his decision came because he found that he didn’t have “some of the skills that make an ideal manager.”
- Zhang went on to write that he’s “not very social, preferring solitary activities like being online, reading, listening to music, and daydreaming about what may be possible.”
What does this mean for TikTok?
- In reality, nothing should change as ByteDance continues to move into the future.
- Zhang is still the head of the company and he will be looking into focusing more on long-term plans.
- “I feel I did not achieve as much as I had hoped to on my previous objectives in the areas of new strategic opportunities, organizational management, and social responsibility,” Zhang wrote in his letter. “After several months of thinking about this, I came to the conclusion that transitioning out of the role of CEO, with all of the related day-to-day responsibilities, would enable me to have greater impact on longer-term initiatives.”
- Zhang is looking to no longer be involved in the day-to-day activities that come with being a CEO and he has given that position to his former college roommate and the co-founder of ByteDance, Liang Rubo.
- Zhang expressed his confidence that Liang will serve the company well as its new CEO. In his letter, Zhang writes that “since Day 1, Rubo has been an invaluable partner.”
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