Zhang Yiming, founder of TikTok owner ByteDance, gears up for global stage

Zhang Yiming, founder of ByteDance, says in a letter to employees he will focus on global expansion and fresh initiatives such as education. (Reuters)
Short Url
Updated 14 March 2020

Zhang Yiming, founder of TikTok owner ByteDance, gears up for global stage

  • Owner of wildly successful app plans fresh initiatives such as education

HONG KONG: The founder of China’s ByteDance, owner of the wildly successful TikTok app, has for years aspired to make ByteDance the first Chinese firm to rival US internet giants on the global stage. On Thursday Zhang Yiming made a key move to achieve that.

Creating new leadership positions for ByteDance’s China business, Zhang said in a letter to employees he would now focus on global expansion and fresh initiatives such as education.

In a recent, exclusive interview with Reuters, Zhang spoke expansively of his vision of ByteDance as a fully global company in the image of Google and Facebook, even as it faces a national security review by the US government over TikTok’s data practices. Some US government agencies have banned employees from using TikTok over data security concerns.

“There are a lot of misunderstandings out there,” Zhang said from a hotel room in New York, where he spoke to Reuters via video call using ByteDance’s work productivity app Lark. 

“We are more localized in different markets than people think.”

TikTok has taken the social media world by storm, especially in the US, vaulting ByteDance to a valuation that sources have told Reuters is close to $100 billion in the secondary market.

That was not just down to luck, say those who know him.

As early as 2013, when the company was just a year old and barely made any revenue, Zhang started planning its global expansion, according to Joan Wang, an early investor in ByteDance and managing director of SIG China.

Zhang told Wang over numerous meetings and phone calls he believed his AI-based recommendation algorithms used in its Chinese-language news aggregator Jinri Toutiao, could be expanded to different languages and content formats.

“The resources at the time seemed far from enough for achieving his global goals,” Wang said.

Chasing global success

TikTok is in talks with the Committee on Foreign Investment in the US (CFIUS) about measures to allow it to avoid divesting the Musical.ly assets it acquired and were later integrated into TikTok, sources have said. 

The CFIUS review came amid rising US-China tensions and US concerns about how user data would be handled.

ByteDance has also been working to separate TikTok from many of its Chinese businesses, seeking to provide CFIUS with assurances, Reuters has reported.

“I am not directly involved in this situation,” Zhang said, when asked about how talks with CFIUS were going. 

He said overall he was “optimistic” about the company’s interactions with the US government.

Zhang declined to comment on whether CFIUS was satisfied with TikTok’s current handling of data.

Earlier this week, the company announced it had set up a “transparency center” in Los Angeles to show regulators and the public how it manages data and content on the platform.

One major ByteDance investor said some backers had suggested a spin-off of TikTok last year, but the company didn’t consider that option. 

Sources familiar with the company also told said that Zhang retains voting control of the firm, which has raised billions of dollars from prominent investors including SoftBank Group Corp, KKR & Co. Inc. and Sequoia Capital China.

ByteDance declined to comment.

His intensified pursuit of global success comes amid rising censorship risks in China after the government in 2018 shut down one of ByteDance’s top products, a joke app, for “lowbrow and vulgar” content.

Zhang said he spent two-thirds of his time outside China last year and likes to indulge in London’s West End musicals and museums. He plans to spend even more time abroad this year as part of an effort to “understand more context.”

IPO plans unclear

Zhang has consciously borrowed strategies from US internet giants including Alphabet Inc.’s Google — ByteDance’s offices in Beijing are decorated with posters including a cover of former Google CEO Eric Schmidt’s book, “How Google Works.”

He delivers town hall speeches every two months to talk about his bi-monthly goals, a conscious nod to Google’s open work culture. 

He also eschews Chinese convention and tells employees not to call him “boss” or “CEO.”

And Zhang insists the company’s product development is already global. A new Indian social media app called Helo is an example of a product ByteDance has designed from the ground up for a local market. 

“We believe the short-term digital advertising market in India is small, but the growth potential is large,” he said.

Lark, the workplace productivity app, was also optimized for a global roll-out. Zhang discarded an initial plan to start with a focus on China and insisted it be targeted at the US, Europe and Japan from the beginning, a company source said.

But there are some signs that political pressure in the US is altering plans: Lark is shifting its focus from making a big push in the US to markets including Japan and Europe, sources said. A ByteDance spokesman said Japan, Singapore and India are its primary markets.

The Chinese version of Lark, called Feishu, has recently gained much momentum as the coronavirus outbreak has created a surge in demand for work-from-home tools.

ByteDance in 2018 began early-stage preparations for an overseas float to offset political uncertainties at home. 

Late last year the company held discussions with Chinese securities regulators about a possible domestic listing, sources said, although it still prefers New York or Hong Kong.

“Currently the IPO is not pressing and we don’t have any imminent plans,” Zhang said. 

“But internally we are making preparations as if we’re working on an IPO.”


Motorhomes come of age as Europe relaxes lockdowns

Updated 12 July 2020

Motorhomes come of age as Europe relaxes lockdowns

  • This form of transport means freedom — and health and safety into the bargain

PARIS: After months of working on the frontline in the battle against COVID-19, Spanish nurse Yone Alberich was ready for a holiday, but the question was how.

Going on holiday generally meant flying abroad — but with the virus still very much in the air, she didn’t want to take a plane. 

Nor did Alberich want to stay in a hotel or be around crowds of people. So she and her husband rented a motorhome.

“The idea was to keep away from people to avoid getting infected,” said the 32-year-old, who has a toddler and lives in the Valencian coastal town of Castellon.

“And with COVID, what could be better than traveling around with your house on your back?“

With social distancing the new norm in Europe to avoid any fresh outbreaks, there has been a shift in thinking about holidays, with a recent survey showing 90 percent of Spaniards would remain in Spain rather than traveling abroad. And 83 percent planned to use their own car over public transport.

Fabrizio Muzzati, who runs specialist Spanish travel agency Aquiestoy Caravaning, said that many people who never thought about a motorhome holiday are now considering it.

“At a time when the whole world is very much looking for a sense of security, there are a lot of people who are going to give it a go because of the circumstances.”

And as travel restrictions were eased, motorhome rentals resumed “intensively,” the Spanish mobile home and campervan association ASEICAR said last month, suggesting it may be “key to reviving tourism this summer.”

And it is not just in Spain. “Since the rollback, there’s been a real craze for motorhomes, everywhere,” says Francois Feuillet, president of the European Motorhome Federation. “The motorhome means freedom, savings and being green. Now we can add health and safety and for us, that’s a real boon.”

Across Europe, there has been growing interest in the sector and today there are five million users and two million vehicles in circulation, industry figures show. In Germany, Europe’s main market, more than 10,000 new motorhomes were registered in May, an increase of 32 percent year-on-year, while France added 3,529 new registrations — up nearly 2 percent.

And in Spain, a much smaller market but where interest is growing rapidly, there were 1,208 new vehicles registered in June — up 20 percent on last year, ASEICAR figures show.

There has also been a jump in demand in the rental market.

Yescapa, a peer-to-peer rental platform, registered more than 32,500 bookings across Europe in June, with requests for July and August 60 percent higher than in the same period last year.

Of that number, just under a third — or 9,435 — were in Spain.Despite the reopening of Europe’s borders on June 15, most people are reluctant to go abroad, Yescapa co-founder Benoit Panel said.

“Since COVID, there have been almost no cross-booking rentals,” he said, referring to travelers booking outside their country of origin, who usually constitute 20 percent of reservations.

First-time renter Jose Pascal Guiral, who runs a ceramics export business and always holidays abroad, took a motorhome as soon as lockdown ended, spending a week touring scenic mountain passes in the Spanish Pyrenees.

“It’s so much nicer than going in a plane or a hotel, it gives you a real sense of freedom. You go for a week and you feel like you’ve been on holiday for a month,” he said.

Julio Barrenengoa Gomez, director of Caravanas Holidays, said that the crisis has increased interest in national tourism.

“People tend to want a motorhome to travel around Europe but this year, they’re looking to stay here in Spain. With all our desire to visit Europe, it seems like we’ve forgotten just how beautiful Spain is. This year is going to boost national tourism.”

Others believe the health crisis will accelerate a shift away from the mass tourism of resorts, cruises and package holidays.

“This pandemic will change people’s habits because they’ll be less likely to stay in crowded places,” said Fernando Ortiz, director of established Spanish motorhome brand Benimar.

“Not necessarily because of the risk — they will find a vaccine — but because people like being able to change their plans from moment to moment while traveling,” he said. “And that is likely to last.”