On Wednesday, 36Kr learned from several sources that Chinese Internet company ByteDance, plans to disband its investment business as a whole, involving about 100 employees. Among them, Zhao Pengyuan, the head of strategic investment, and some employees in the strategic investment department may merge into strategic business. The financial investment portion of the company will be completely dissolved.
A ByteDance spokesperson responded that the company had carried out an inventory and analysis of the business at the beginning of the year. It decided to strengthen the company’s business focus, reduce investments that are at odds with overall interests, move the employees of the strategic investment department into other business lines, and strengthen the cooperation of strategic research and business. Related businesses and teams are still in the planning stages.
According to the report, the overall restructuring of ByteDance’s investment business can be regarded as a reaction to a newly issued regulatory policy. The regulatory authorities were reportedly starting to require pre-approval for “the listing, investment and financing activities of enterprises with more than 100 million platform users or more than 10-billion-yuan in revenues last year.”
However, the investment team in ByteDance was still recruiting new people and contacting potential investment targets, and there was no sign of stagnation before.
Before the changeover, investment business reported to TikTok Chief Executive Officer Shouzi Chew. The business was divided into two parts, including strategic investment and financial investment. The person in charge of the strategic investment division has also changed several times before. Yan Shou, ByteDance’s gaming chief, Hua Wei, the head of the human resources team, and Alex Zhu, Vice President of ByteDance Products and Strategy, have all been in charge of the strategic investment business.
At present, the person in charge of strategic investment is Zhao Pengyuan. The investments related to him are closely integrated with business, often focusing on mergers and acquisitions and large-scale investment. One of the most recent cases is the acquisition of Shanghai-based gaming studio Moonton Technology worth $4 billion. The person in charge of financial investments is Yang Jie, who used to work at Sequoia China and “is in charge of an investment team of about 15 people”, which is divided into sectors including consumption and enterprise businesses.
Regarding the number of investments related to ByteDance, it can be roughly divided into two stages. Before 2017, the number of investments increased every year, but the number was not too large, about less than 10 deals every year. In 2018, ByteDance increased the number of its investments, securing 18 deals in that year, while following it with more deals in 2019 (32) and 2020 (41). By the end of last year, ByteDance had completed a total of 70 deals.