HONG KONG (BLOOMBERG) - ByteDance's billionaire founder Zhang Yiming has stepped down as chairman, months after resigning as chief executive of the TikTok owner that is seeking to reposition itself amid China's crackdown on its Internet industry.
New CEO Liang Rubo has replaced Mr Zhang on the five-member board, according to a source familiar with the matter. Mr Zhang, 38, will still be involved in formulating the Chinese tech firm's longer-term strategy, the source said.
The board change marks a further retreat by Mr Zhang, who has an estimated fortune of US$44.5 billion (S$60 billion), from the app factory that he created nearly a decade ago.
Other tech founders in China have also retreated from their creations in recent months.
Kuaishou Technology founder Su Hua said last week he will cede the CEO role to fellow co-founder Cheng Yixiao, while JD.com in September named a new president, saying that chairman Richard Liu will concentrate on long-term strategies. Pinduoduo's Colin Huang also gave up both CEO and chairman titles at his e-commerce firm.
ByteDance, the world's most valuable start-up is making a bigger push into enterprise software after Beijing's year-long crackdown on the Internet industry, and this week announced it was restructuring into six business units.
Singaporean Chew Shou Zi has stepped down as chief financial officer of the social media giant to focus on running its hit global product TikTok, as part of the reorganisation, ByteDance told employees in a Tuesday memo.
ByteDance had kicked off initial preparations for public listing of its domestic assets, Bloomberg News reported in April.
Since then, regulatory changes in China meant Mr Zhang's company has had to proceed cautiously, even before the initial public offering of Didi Global in New York sparked a backlash in Beijing.
ByteDance has repeatedly said it is not ready for an IPO.
ByteDance became the first Chinese Internet firm to achieve global success with TikTok, the short video platform that counts more than one billion monthly users worldwide. It was valued at US$140 billion in a 2020 fund-raising round and then surged to as much as US$500 billion before declining from that peak.
That success, alongside domestic hits such as TikTok peer Douyin and news aggregator Toutiao, has, however, made the company a target both at home and in the United States, where it narrowly escaped a ban and forced the sale of the global app under the Trump administration.
In China, ByteDance has come under fire from regulators seeking to rein in its once-freewheeling Internet industry.
While ByteDance is not the target of any official probe - unlike peers Alibaba Group Holding and Meituan - the start-up was among more than two dozen firms ordered by the tech industry ministry to carry out internal inspections and root out illegal online activity earlier this year.
Its fintech arm has also been slapped with wide-ranging restrictions akin to the ones imposed on Ant Group.
Beijing's sweeping controls over online content will likely hit ByteDance even harder.
Regulators have slowed approvals for new video games to enforce stricter criteria around content and protection for children, threatening ByteDance's emergent gaming business.
The company was forced to lay off at least hundreds of employees this year, after Beijing introduced its harshest-ever curbs on the after-school tutoring industry.
Meanwhile, Beijing has put in place new rules around data security, including a requirement that companies with more than one million users need explicit government approval before going public in other countries.
Companies such as ByteDance and Didi would need to reassure regulators that user data would not be compromised.
In the wake of the clampdown, ByteDance is pivoting away from content and entertainment to better align with Beijing's priorities.
The newly formed Lark unit will offer office collaboration tools such as videoconferencing and contract management.
Its cloud arm will become more open to external enterprise clients. And its education business will focus on vocational training for adults and offer artificial intelligence-powered learning, smart hardware and campus collaboration.
