BEIJING, January 19 (TMTPOST) — ByteDance, the Chinese Internet company that owns popular short video app TikTok, will dissolve its strategic investment team and reassign around a hundred employees to other positions, sources familiar with the matter said.
It is said that the strategic investment unit’s head Zhao Pengyuan and other employees will be leaving the strategic investment unit for the company’s strategy unit. The strategic investment unit will be closed, sources said.
“ByteDance reviewed and reassessed its businesses earlier this year and has decided to streamline the teams,” an insider familiar with the matter told TMTPost. “The company has decided to reduce investment in areas that have low compatibility to its businesses. Members of the strategic investment team will be reallocated to different business lines to enhance the strategy unit’s coordination with other business units. Relevant details are still being discussed.”
ByteDance’s decision to dissolve its strategic investment unit might stem from the increasing regulatory scrutiny in China. The Chinese government has been imposing crackdowns on the country’s tech sector to control the growth of big tech companies and capital influence. Chinese tech giant Tencent, for instance, has recently divested its holdings in JD.com and Sea.
There are unconfirmed rumors circulating on social media that claim local authorities would soon launch new policies to restrict tech companies from making investments.
The closure of the strategic investment unit was triggered by its failure to invest in digital marketing service provider GrowingIO, Chinese financial media outlet Caixin reported, quoting unnamed sources familiar with ByteDance.
The company’s strategic investment team has been recruiting new employees recently and there was not any sign that hinted the disbandment of the strategic investment team, 36Kr reported,
ByteDance’s strategic investment unit answers to the company’s CFO and TikTok Global’s CEO Zhou Shouzi. The strategic investment unit focuses on mergers, acquisitions and large-sum investments. It recently led the US$4 billion acquisition of Chinese video game developer Moonton Games.
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