Zhang Yiming, the 38-year-old successful founder and CEO of Bytedance, the parent company of TikTok, has decided to step down and pass his role on to his fellow co-founder and the current head of human resources, Liang Rubo, following a six month transition period.
In a candid letter to his employees, Yiming wrote, "Since the beginning of this year, I've spent a lot of time thinking about how to better drive real long-term breakthroughs, which cannot simply rely on steady, but incremental, progress" and later went on to admit that he "lacks some of the skills that make an ideal manager."
He further explained in his letter that stepping down as CEO of one of the world's most successful startups will allow him to "have a greater impact on longer-term initiatives."
Despite the unexpected candid letter to his employees, Yiming's departure comes at a time of uncertainty and what is considered a troublesome period for Chinese tech CEOs. The once renowned and greatly appreciated tech geniuses have been facing criticism from regulators lately, and the gruelling work hours have also been met with a great deal of distaste from the tech sector.
Upon analysing the situation, Yiming has arrived at the conclusion that he has no interest in "actually managing people."
What made him turn on the tech world?
In 2012, Yiming founded Bytedance and launched it as a news-aggregating site called Today's Headlines, also known as Toutiao. The site's algorithm enabled it to customise the home page based on an individual's preference. It piqued the interest of many and soon became one of China's most valued tech start-ups.
With the help of Toutioa's success, he was then able to launch TikTok - a video-sharing app that has become a sensational social media platform, especially for US teens - as well as a slew of other products. However, not all of Bytedance's offerings have been able to match TokTok's success and popularity among the crowd.
In 2018, Beijing ordered Bytedance to shut down a joke-sharing site for its "vulgar and improper content." Later on, in his personal account, Yiming stated, "This product walked the wrong path and had content in deviation of socialist core values."
Besides that minor run-in with the government, Bytedance was able to avoid the scrutiny of Chinese regulators, who were in the midst of a campaign to rein in Big Tech. It initially started with them blocking a US$310 billion IPO of Ant Group, one of Alibaba's affiliates. Since then, founder Jack Ma has called out the Chinese financial regulations for being anachronistic.
The State Administration of Market Regulation (SAMR) has listed many of the Chinese tech giants that need to undergo review. Despite Bytedance's attempt to stay low, its name was included on the list along with 33 other firms which the SAMR had warned to correct their anti-competitive behaviour.
"Heed Alibaba's example," the SAMR said in a statement about meeting with the 34 firms, referring to reforms Alibaba pledged after the SAMR slapped a US$2.8 billion antitrust fine on the e-commerce leader earlier that month, reports Fortune.
Under Zhang Yiming, Bytedance was able to break numerous barriers in the US, unlike any other Chinese tech company. Unfortunately, that was not enough to win the support of Beijing. Last year, Beijing created a new rule which would require Bytedance to seek approval before allowing them to sell the company. This rule "blindsided" Yiming as it came up at the same time the US threatened to ban TikTok unless they sold it to a US company.
"In order to stay successful and relevant, the CEOs of tech vendors need to dedicate a lot of energy to maintaining a good relationship with the government," said Lian Jye Su, principal analyst at ABI Research in Singapore. "Not all CEOs want to dedicate their time and energy to this task or have the right skill set to do so."
What's next for the reputed tech genius?
"After handing over my role as CEO, and removing myself from the responsibilities of daily management, I will have the space to explore long-term strategies, organisational culture, and social responsibility, with a more objective perspective on the company," Zhang said, implying that he wishes to stay connected and continue to play an influential role in Bytedance's future.
Zhang Yiming is not the only tech entrepreneur to hand over his position as CEO, in March, Pinduoduo founder, and chairman Colin Huang resigned from the board just as Pinduoduo surpassed Alibaba and became China's top e-commerce site by users. He had stepped down as CEO back in July of 2020.