Zhang Yiming, the co-founder of TikTok’s Chinese parent company ByteDance, will step down as CEO, he announced Thursday as he admitted to lacking some of the skills necessary to lead the company as its chief executive.
Zhang’s fellow co-founder, Liang Rubo, will take over as CEO of ByteDance, which owns a slate of entertainment and news apps in China and other countries, in addition to TikTok. The shake-up is expected to happen at the end of the year, Zhang said in a letter to employees, which the company posted online.
“The truth is, I lack some of the skills that make an ideal manager. I’m more interested in analyzing organizational and market principles, and leveraging these theories to further reduce management work, rather than actually managing people,” Zhang, who has helped grow the company into one of the largest startups in the world, said in the letter. “Similarly, I’m not very social, preferring solitary activities like being online, reading, listening to music and daydreaming about what may be possible.”
Rubo, who’s currently in charge of human resources at the company, will be able to provide better day-to-day management, said Zhang, who said he will use his extra time to consider the long-term direction for the company and search for opportunities to push into new emerging technology.
“For a long time, I’ve put my online status as ‘Daydreaming.’ What I mean isn’t that I’m zoning out, but rather that I’m thinking about possibilities that people might think are just fantasy,” Zhang said. “In the past three years, many things that seemed like fantasies have, in fact, become reality.”
“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, organizational culture and social responsibility, with a more objective perspective on the company,” he added.
The announcement comes as the Chinese government ramps up pressure on its home-grown companies.
Chinese regulators last year blocked the anticipated IPO of financial-tech company Ant Group, with government officials summoning executives from Ant Group and its parent company Alibaba. In March, the CEO of Ant Group resigned, followed shortly after by the resignation of the CEO of Shanghai-based e-commerce giant Pinduoduo.
Beijing-based ByteDance is one of China’s most valuable start-ups and among the first to attract users or customers broadly outside of China, largely thanks to TikTok. The company’s success has placed it under scrutiny both in China and elsewhere.
ByteDance executives have been summoned by government authorities every few weeks, according to The Wall Street Journal, and the Chinese government has fined at least two of its China-focused business units this year.
In the US, former President Trump signed an executive order last summer that sought to force ByteDance to divest from the US by selling or spinning off the US operation of TikTok. Trump said TikTok’s Chinese ownership was a national security threat.
TikTok has since tried to distance itself from its Chinese parent, but the pressure for ByteDance to divest never led to a concrete shake-up of the business structure.