ByteDance employees and investors were shocked when the founder went back

Zhang Yiming said he first discussed with a “small group” the resignation of ByteDance CEO in March, but according to $ 200 billion start-up investors, they were surprised.

A year after the storm, the 38-year-old founder announced that he would hand over his CEO’s job to the staff in a letter of dismissal on Thursday, despite his company preparing a preliminary offer.

Although he insisted in his letter that he was not really interested in “actually managing people”, Hang Ang was, in fact, the sole CEO of ByteDance և to build the company that owns the TikTok virus as a global challenge to Facebook և Tencent :

He even recently survived the worst crisis of the company. US Government threat to ban TikTok

“I hear that Yim hangs up and leaves. Amazing CEO, ”wrote Patrick Collison, CEO of $ 95 billion payment startup Stripe. “In order to understand the caliber of their implementation. Founded in 2012, ByteDance reportedly generated $ 35 billion in revenue in 2020 and hired 40,000 last year.

Investors at ByteDance say they are shocked by the move, citing only recent pressure from Beijing on technology.

From the end of 2020, China will curb its technology giants using other antitrust regulations. Zhang’s resignation follows Colin Huang, the founder of e-commerce giant Pinduoduo, in March, whose departure was also a surprise. Ant Group CEO Simon Hun also resigned earlier that month, months after Beijing canceled their record double listing in Shanghai and Hong Kong.

“The government is weakening the central government of all the heads of technology giants,” said Feng Chucheng, a partner at Beijing-based consulting firm

In his resignation letter, Hang Ang said he wanted to avoid the “extremely central trap of the CEO”. This reflects the concern of the central government, which has long been concerned about the power of technology leaders.

Specifically for ByteDance, whose top three apps each use an average of more than an hour a day, “regulators have always been concerned about how this might affect public speaking. “Propaganda is the salvation of the party,” Feng added.

Beijing has issued a number of instructions on how to promote “positive” content on social media algorithms. So far this year, regulators have criticized ByteDance for everything from sex content to deep-seated fraud.

“Yiming is not so good in government relations [in China]”, – said one of his acquaintances. In 2018, ByteDance was confronted by the Government at the first moment of its life or death, which was criticized for hosting “vulgar” content of several applications. ByteDance had to shut down Neihan Duanzi, a joke-sharing program that has 22 million daily users. But after a long apology, the company backed down and hired more employees to fix government ties.

In 2020, the hangman clashed again with Beijing in an attempt to satisfy the Trump administration’s demand that TikTok’s US operations be US-owned. The Chinese government returned fire enforcement of export controls appropriate technology before censors allowed the storm of social media criticism to fall on Zang.

Liang Rubo, Zhang’s university classmate and co-founder of ByteDance ղեկավար HR, will take up the job after a six-month hiatus. The staff who worked with Liang described him as a loyal lieutenant hang hang.

Hang Ang Yiming և Liang Rubon

Liang Rubo, right, announced as the new CEO by a post by ByteDance left, Zang Yiming

While ByteDance staff were generally shocked by Zhang’s resignation, Liang employees were even more surprised. “My colleagues and I never expected Liang to take over the post,” said one HR staffer, who said China’s Zang Lidong’s “has more power and courage” than Liang. «[Liang] “He does not shout at me from the CEO,” said another HR employee.

Liang’s election meant that Hang Ang Yiming would “rule from behind the curtain,” said a former HR employee.

The staff does not expect Liang to deviate from the hang price, which in itself is a source of comfort. “We were all surprised,” said one ByteDance engineer. “But after some discussion, everyone went back to work, because we felt that Liang would basically carry out Yiming’s plans. There should not be too many changes.”

Zhang’s departure reveals the fragility of ByteDance’s management structure և its centrality և all top executives report directly to it.

ByteDance declined to comment on whether Zhang will remain on its five-member board and the remaining four seats will be occupied by investors.

The company had the biggest fun in the history of technology. Its number has almost doubled in the last year – more than half – more than 100,000 employees – its programs have been a great success, generating about $ 35 billion in revenue in 2020, according to two acquaintances. related to the case.

The next step should have been a blockbuster IPO: or in Hong Kong or New York. A number of people close to the Plans program said that discussions with officials at the Hong Kong Stock Exchange had made significant progress earlier this year. But people said the talks had slowed down until this spring.

In April, the state-owned China Securities Journal reported that ByteDance had launched an IPO process in Hong Kong. Although it was widely covered by other media outlets, the original story was deleted within a day, and state media were told not to republish the story. This is an unusual move for state censors, who usually do not interfere in market manipulation. ByteDance later said it was “not ready at this stage.”

“Hang Angi’s departure could help the company get enough government approval for the IPO,” Feng said. Although the reasons for the fluctuations around ByteDance’s listing plans remain unclear, political pressure would explain the censorship of previous IPO news.

Zhang’s ousting was part of a “logical order” as the company moved into an IPO, said one involved in the preparations. “He made a decision, then he obviously had to announce it before passing to the next stage of the proposal. He could not leave his post during the IPO. “

His move will not affect ByteDance’s Chinese business structure, which is the source of most of its revenue. In March 2020, Hang Ang put China’s operations under the leadership of Kelly Hang Ang Lidong.

At the same time, he became global CEO ստեղծ created a separate CEO for TikTok, now owned by Shouzi Chew.

His decision to step down could ultimately benefit ByteDance, said Li Chengdong, founder of Beijing-based Dolphin Technical Consulting. “It protects both the company and itself from future attacks.”

“Usually a change of CEOs is not good for the company, but this is a change of CEOs with Chinese characteristics,” Li added. “Zhang could still rule.”

Additional reports by Nian Liu in Beijing, Tabby Kinder in Hong Kong, Hannah Murphy in San Francisco

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