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China tech

ByteDance co-founder Zhang Yiming to hand over CEO role

Executive to focus on long-term strategy amid China's tech industry turbulence

"The truth is, I lack some of the skills that make an ideal manager," ByteDance CEO and co-founder Zhang Yiming wrote in an internal memo to employees.   © Reuters

HONG KONG -- Zhang Yiming, one of the two co-founders of the global short-video sensation TikTok, told employees on Thursday that he will step down as chief executive at the app's parent company, ByteDance, by the end of this year and hand over the role to his university classmate Liang Rubo, the other co-founder.

The 38-year-old software engineer by training said he will take up a new role, focusing on long-term strategy, corporate culture and social responsibility.

The decision comes at a time when China's technology conglomerates, including Alibaba Group Holding and Tencent Holdings, are facing greater regulatory scrutiny. Authorities in Beijing believe some of these companies have abused their technological advantages to achieve market dominance at the expenses of consumers and small businesses.

"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 said in an internal memo to employees that was posted on the company's website.

"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," he said. As companies grow, they also tend to become more reliant on past achievements and could fall into a trap where the CEO becomes overly central in decision-making.

"With our business growing well, it is time to think about how we can, not simply scale, but make innovative, meaningful, long-term progress towards our mission to 'inspire creativity, enrich life,'" he wrote.

ByteDance, which also operates the popular news app Jinri Toutiao in China, is considered one of the world's most valuable startups, with a valuation of up to hundreds of billions of dollars, according to latest estimates. Douyin, Tiktok's version in China, has more than 600 million users and is rapidly expanding into new areas such as online payment and e-commerce.

The success of the company has largely relied on its powerful algorithms, which Zhang helped design. The programs draw viewers by generating a tailored list of articles and videos based on a person's viewing habits.

ByteDance said Zhang will work with Liang for the next six months to ensure the smoothest possible transition.

Liang is a longtime business partner of Zhang. The two men were classmates at Nankai University, in the northeast city of Tianjin, and co-founded a property search site, 99Fang, before they started ByteDance.

"Since Day 1, Rubo has been an invaluable partner -- completing my coding for new systems, buying and installing servers, and developing key recruitment and corporate policies and management systems, among a list of contributions too long to enumerate," Zhang said.

Liang currently is head of ByteDance's human resources and management department. He also served as head of research and development.

"The truth is, I lack some of the skills that make an ideal manager," Zhang wrote. "I'm more interested in analyzing organizational and market principles, and leveraging these theories to further reduce management work, rather than actually managing people," he said.

"I think someone else can better drive progress through areas like improved daily management."

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