MOOD

ByteDance’s CEO is stepping down because he's rich, tired, and bored

If we were worth $44 billion, we wouldn't want to put up with managing minions either.

HANGZHOU, CHINA - MARCH 31: ByteDance founder Zhang Yiming is seen on March 31, 2016 in Hangzhou, Zhejiang Province of China. (Photo by VCG/VCG via Getty Images)
VCG/Visual China Group/Getty Images

ByteDance’s CEO is tired of all the bullshit. That’s at least if his resignation letter is to be believed. Zhang Yiming, the founder of the Chinese company that owns TikTok, will give up the throne at the end of 2021 in order to spend more of his time on long-term initiatives.

Yiming, a quiet figure who has kept his personal life private, founded ByteDance in 2012 and in that time has seen his net worth balloon to more than an estimated $44 billion on the rise of TikTok and Chinese-language version Douyin. But between managing 60,000 employees and dealing with heightened scrutiny by global regulators, Yiming is done.

Management sucks — In the letter, the 38-year-old mogul says he will take a new role at ByteDance that sees him return to the fundamentals.

A key motivation behind Yiming’s resignation was a realization that he was spending too much time in meetings, time that was taking away from research into the types of innovative technology that has gotten ByteDance to where it is today:

“Three years ago, I spoke with some entrepreneurs about the challenges of scaling a business. I said that often when companies mature and expand, many fall into the trap of the CEO becoming overly central — listening to presentations, handling approvals, and making decisions reactively. This leads to an over-reliance on existing ideas already in the company, and results in knowledge structures being slow to iterate.”

ByteDance’s perfection of machine learning is what many believe to be TikTok’s real secret sauce — whenever you open the app you’re pretty much guaranteed to see something that will entertain you. But Yiming has become so bogged down by managerial responsibilities that he fears falling behind on future trends:

“I worry that I am still relying too much on the ideas I had before starting the company, and haven't challenged myself by updating those concepts. As an example, before 2017, I spent a lot of time keeping track of developments in machine learning. However, since then, while I do my best to bookmark technical articles online, I haven't had the time to make much progress digging into the area. During technology meetings, this sometimes means I actually struggle to keep up with the discussion.”

He also adds that he’s generally a bad manager, preferring alone time and solitary activities. “The truth is, I lack some of the skills that make an ideal manager.” His co-founder and head of HR, Liang Rubo, will take over in six months following a transition period.

Return to basics — It’s not unheard of for the CEOs of major technology companies to recede into the background once their companies reach escape velocity, and ByteDance is certainly there. Estimates suggest that TikTok alone has more than one billion active users worldwide. ByteDance’s global advertising revenue topped $27 billion last year.

Once a tech company becomes that large, bureaucracy and public attention can become a burden that pulls founders away from the luster of the early days, when they were able to focus their energy building cool new products. TikTok just escaped a potential ban in the United States, and remains banned in India, both surely taxing on Yiming.

At Google, both co-founders Sergei Brin and Larry Page eventually stepped down to work on flying taxis and other projects. Bill Gates stepped down as CEO of Microsoft in 2000 to focus on philanthropy. Jeff Bezos recently announced he’ll step down as CEO of Amazon so he can catch up to Elon Musk in the new space race. With their riches secured and their companies’ futures all but guaranteed, they all felt it time to hand over the messy responsible of corporate stewardship to someone else.

The China challenge — But ByteDance is Chinese, and it’s hard to ignore a rising crackdown domestic tech companies there. Jack Ma, the founder of Alibaba, nearly disappeared recently after criticizing the Chinese financial system and calling for changes. Within days, his financial company Ant Group was hit with a $2.75 billion antitrust penalty and forced to completely restructure itself. The company used a vast trove of data to offer personal loans to practically everyone in China; the government there that wants to use its own “social credit” scoring system to issue loans.

It’s entirely possible that the Chinese government pushed Yiming as a warning to founders to stay in line. But it’s also reasonable that he truly just wants to focus on the fun parts of running a tech company again.