Zhang Yiming, the co-founder of TikTok’s Chinese parent company, ByteDance, will step down as CEO to focus on long-term strategy as the Chinese government ramps up pressure on tech companies.
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.
“After handing over my role as C.E.O., 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,” Zhang said in the letter, which ByteDance posted online.
“The truth is, I lack some of the skills that make an ideal manager,” he added. “Similarly, I’m not very social, preferring solitary activities like being online, reading, listening to music and daydreaming about what may be possible.”
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 startups 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, President Donald 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.