Company Profile
Previous post
Please first refer to the content of my other previous post: “TikTok, the rival of all social networks“. This article will not repeat the content of the previous article.
Origin of company name
Zhang Yiming helped name ByteDance‘s English name “ByteDance”. He believes that Byte is very technological and Dance is very artistic, paying tribute to Apple founder Steve Jobs’s view of “putting products at the interface of technology and humanities and art.” .
Brief company history
ByteDance was founded in 2012 and has more than 20 App products, including Douyin, TikTok, Toutiao, Xigua Video, etc. Involving video platforms, social media, news, games, finance, education, etc. By the end of 2021, the number of monthly active users of its products worldwide will reach 1.9 billion, with offices in more than 30 countries around the world.
Founder
An ordinary engineer
Born in 1983, founder Zhang Yiming from Longyan, Fujian province, was admitted to Nankai University. During this period, he only did three things: first, write program code and cultivate professional skills, second, read a lot of books, and third, repair computers. As a result, you gain three things: patience, knowledge, and partners.
Countless failed startups
After graduation, Zhang Yiming invested in many small and large businesses intermittently. Before founding Toutiao, Zhang Yiming participated in 4 start-up companies:
- When he just graduated, Zhang Yiming’s senior brother invited him to start a business together. Zhang Yiming and two classmates formed a team to start a business and develop an IAM collaborative office system for enterprises. Make online collaborative office software for enterprises. However, due to lack of funds and lukewarm market response, Zhang Yiming left.
- Zhang Yiming joined Kuxun in 2005. When he saw that Kuxun was working on a search engine, he thought it was a good company and changed jobs the next week. When he joined Kuxun, he was one of the earliest employees. He became a technical executive in a short period of time, but when he found that the management chaos was unsustainable, he turned around and went to Microsoft (tickere: MSFT).
- In 2008, he stayed at Microsoft for a period of time. He originally wanted to learn the management experience of a large enterprise, but the large and heavy enterprise operating mechanism made him very depressed and he turned around and left.
- In September 2008, Wang Xing, the current CEO of Meituan (tickere: MPNGF), asked him to co-found Fanfou, the earliest Weibo (tickere: WB). Within a year, it was forced to close down, and Zhang Yiming also escaped early.
In October 2009, Wang Qiong, an investor in Kuxun Company, invested and Zhang Yiming founded Jiujiu Real Estate Network, starting his first truly independent business. At this time, Zhang Yiming quickly entered the state and developed several mobile applications in succession, becoming the No. 1 real estate application for a time. Until the end of 2011, Zhang Yiming resigned from his position as CEO of Jiujiufang and began to prepare for Toutiao.
Note: Zhang Yiming was born in Longyan, Fujian. Together with Wang Xing, the founder of Meituan, and Xueqiu Fang Sanwen, he is known as the Three Heroes of Longyan.
Liang Rubo is Zhang Yiming’s college classmate. The two have been early entrepreneurial partners since they co-founded the vertical real estate search engine Jiujiufang in 2009. In 2012, Liang Rubo and Zhang Yiming co-founded ByteDance, which was finally a success. Liang Rubo took over as Bytedance’s CEO after Zhang Yiming later resigned as Bytedance’s CEO.
No one to help
The biggest difference and contrast between Zhang Yiming and Huang Zheng is that Zhang Yiming did not have anyone to help him along the way. In fact, Zhang Yiming has not been considered a top-notch entrepreneur for a long time. He does not have top-level academic qualifications, qualifications and connections. In the process of business growth and financing, he was even disliked. role, investors were repeatedly rejected.
Talent scout Wang Qiong
In Toutiao’s early financing, it came into contact with a large number of first-tier investment institutions or private equity funds, and without exception, they were all turned away. Zhang Yiming, who has been very successful in working at Kuxun and has achieved some success, is so diligent that he does not distinguish between you and me, the scope of his knowledge, and his ability. This made Wang Qiong, an investor in Kuxun, pay special attention to Zhang Yiming.
Wang Qiong of Haina Asia was the first Bole to appreciate Zhang Yiming. Zhang Yiming met Wang Qiong in a cafe and drew the prototype of Toutiao on a napkin. Wang Qiong immediately expressed his support and persisted in the subsequent financing process, which led to the investment of Yuri in the B round capital.
After Zhang Yiming founded Toutiao, Wang Qiong volunteered to accompany Zhang Yiming to find investors who had funds at the time, and introduced Zhang Yiming to investors. Even when Wang Qiong recommended Toutiao to Qinshajiang Venture Capital Zhu Xiaohu, they only discussed it for 15 minutes.
Zhong, but Zhu Xiaohu gave him a soft nail.
Except for Wang Qiong, who was already familiar with Zhang Yiming, no one believed in him. More importantly, everyone felt that his baby face looked unreliable. Some even suggested that Zhang Yiming’s aura was not like that of an entrepreneur who could do great things. . At that time, Shen Nanpeng of Sequoia China once overturned the Toutiao investment case submitted by his subordinates in person.
Years later, it was this case that allowed Haina Asia to repay hundreds of billions.
Three generations of Chinese entrepreneurs
First generation
Representatives of the first generation include Ding Lei of NetEase (ticker: NTES), which was about to go bankrupt, and Duan Yongping of BBK Group; their collective characteristic is that China at that time was basically a country that private equity giants looked down upon, and they could only raise entrepreneurial funds on their own. Most of them have their own funds, and after adding some money from friends, family, colleagues, etc., the company is opened.
The second generation of BAT
Zhang Yiming and Huang Zheng are both third-generation entrepreneurs in the mainland Internet industry. The companies they founded have grown in a different environment than the second-generation Baidu (ticker:BIDU), Tencent (ticker:TCEHY), and Alibaba (ticker: BABA) that have foreign capital support. Now domestic companies are Later, they went overseas one after another and had to compete with foreign companies.
Note: BAT is the abbreviation of the first letter of the English company names of Baidu, Alibaba, and Tencent.
The third generation of TMD
It is generally believed that Wang Xing of Meituan, Huang Zheng of Pinduoduo, Zhang Yiming of ByteDance, the world’s most valuable unicorn, and Cheng Wei of Didi are the third generation of Chinese Internet entrepreneurs. Taking overseas expansion as the core of the company’s business operations. Unlike the first generation of Jack Ma, Ma Huateng, and Robin Li, the market is concentrated in China.
Note: TMD is the abbreviation of the first letter of the English company names of Toutiao, Meituan and Didi (ticker: DIDIY).
The difference between Douyin and TikTok
Early days were the same
Douyin and TikTok are now completely different software. In the early days, TikTok was indeed the English version of Douyin, targeting overseas products. The core code is the same, but please note that the two words are “early”.
Currently split
When ByteDance began to want to ban TikTok, the company began to part ways in terms of core programming, software engineers, marketing, data storage, and internal organization of the company. By the time you read this article, the two are completely different things.
A special company
The founder’s persistence
Zhang Yiming said: “Half of the problems in many people’s lives are caused by the lack of delayed gratification. The essence of delayed gratification is to overcome human weaknesses, and overcoming weaknesses is for more freedom. “
“The Road Less Traveled” was listed by Zhang Yiming as one of the books that had a profound influence on him. The viewpoint highly praised in the book is “delayed gratification”, and the trait he most admires in himself is delayed gratification. Satisfaction comes from thinking. Zhang Yiming once mentioned on Weibo, “Delayed gratification and resolute farewell to inertia are the two most important foundations of excellence.” A lucky break delays satisfaction.”
Regarding delayed gratification, please see my previous post: “People who are good at deferred gratification is more likely to succeed”.
Company Culture
The last time Zhang Yiming mentioned a normal mind was in 2018. On Toutiao, he forwarded an article from Caijing interviewing Pinduoduo (ticker: PDD) founder Huang Zheng, with the comment: “In fact, it is difficult for ordinary people to have a normal mind.” This is good. This sentence was said by Duan Yongping, a generation of business legend.
Regarding Huang Zheng, a Chinese entrepreneur of the same generation as Zhang Yiming, and Pinduoduo he founded, please see my previous post: “How does Pinduoduo make money, why it surpass Alibaba and become No. valuable listed Chinese companies in US?“.
For information about Duan Yongping, an entrepreneurial, investment, and business wizard in the Chinese community, please see my previous post: “Duan Yongping’s investment empire and his BBK Group”.
After experiencing the COVID-19 epidemic and the long crisis of Tiktok, the former “pragmatic romance” and “strength can produce miracles” have been replaced by “normality”. The “pragmatic romance” advocated by ByteDance is exactly the same. Zhang Yiming believes that “pragmatism” means doing the right thing and working hard to achieve miracles.
What Zhang Yiming said is correct. If you treat yourself as an object, you can have a more normal state of mind.
In his speech at the 2019 annual meeting, Zhang Yiming countered these external comments, such as saying that ByteDance is an overly rational company, Zhang Yiming is an overly rational person, AB testing company, App factory, etc. He strongly disagrees. , “pragmatic romanticism” is the true source.
Operating Performance
Users numbers
Currently, there are only five companies in the world whose social network products have more than one billion monthly active users (MAU). These four companies are as follows in terms of number of users:
- META’s (ticker: META) Facebook, Instagram, Whatsapp, and Messenger families have a total of 3.96 billion MAPs, of which Facebook has 3.05 billion MAUs (Q3 2023)
- Alphabet’s (ticker: GOOGL, GOOG) YouTube has 22B MAUs (Q3 2023)
- Tencent’s WeChat has 1.3 billion MAUs (Q3 2023)
- ByteDance’s Douyin plus TikTok has 1.1 billion MAU; there are 1.68 billion users worldwide, including Douyin with 1 billion users (Q3 2023)
- Microsoft’s LinkedIn has 1 billion MAUs (October 2023)
The miracle of social networking
- In 2011, it only took 90 days for Toutiao to have tens of millions of users from its launch. Toutiao has been online for 5 years, and its daily users have reached 120 million, with an average usage time of 76 minutes.
- In 2016, Douyin was founded. In just two years, it became a national-level application and made countless grassroots celebrities such as Li Ziqi and Li Jiaqi famous. Douyin has fully captured young people. In less than 2 years, global daily active users have soared to 150 million, and half of its users are under the age of 24.
- In 2018, Toutiao had 400 million domestic daily active users in mainland China and 100 million overseas daily active users. Its revenue in 2018 is expected to reach RMB 50 billion, which is three times that of last year and 15 times that of the year before.
Revenue performance
Please look at the past revenue growth rates. In the history of global companies, there are few (but rare) such amazing annual growth rates. Even if it is worth tens of billions of dollars in 2023, it will still have an annual growth rate of 30%, which is really amazing. Therefore, it is not surprising that it ranks first in the valuation list of unlisted unicorns in the world.
| Year | Total revenue (US$ billion) | Annual growth rate |
| 2023 | 110 | +30% |
| 2022 | 85.2 | +38% |
| 2021 | 58 | +70% |
| 2020 | 37 | +109 |
| 2019 | 17.7 | +139.2% |
| 2018 | 7.4 |
Capital market
Luxurious investors
Investors include the world’s largest venture capital funds, such as Tiger Global Management, KKR, SoftBank’s Vision Fund, Sequoia Capital, Benchmark Capital, DST, General Atlantic, Primavera Capital, YFF Venture (Alibaba), Sina Weibo, Susquehanna International Group Asia Investments.
Attracting smart money
Please note: The above investors are almost all the heavyweight private equity companies in the world. Why? This is certainly no coincidence. No one will be interested in a business that is losing money.
Reject Alibaba and Tencent
Notably, ByteDance is the first prominent new mainland Chinese startup that has not sought business protection or financing from Alibaba, Tencent or Baidu.
Valuation
ByteDance’s valuation over the years
- In early 2013, Toutiao was valued at US$50 million.
- In 2016, Toutiao was valued at US$500 million.
- ByteDance was valued at US$22 billion in 2017.
- In 2018, ByteDance was valued at approximately US$75 billion.
- In July 2021, it reached a valuation peak of US$450 billion.
- It will be valued at US$300 billion in September 2022.
- The valuation in December 2023 is approximately US$268 billion.
Valuation is about 2/3 of Tencent
Tencent’s stock price has bottomed out since reaching a low in October 2022, and Tencent’s total market value is currently stable at around US$400 billion. In contrast, ByteDance’s valuation fell to US$268 billion after the stock market bear market that began in 2022, which is about 67% of Tencent’s total market value.
The King of Unlisted Unicorns in the World
ByteDance was valued at approximately US$268 billion in December 2023. Compared with SpaceX’s valuation of approximately US$175 billion in July 2023, ByteDance is significantly ahead and currently ranks first in the world’s unlisted unicorn valuations.
IPO
ByteDance has often been rumored to be listed in recent years, but in the end nothing happened. In short, ByteDance’s listing schedule is unclear.
The road to make wealth
In the 2019 Forbes Global Billionaires List, Zhang Yiming became the first self-made billionaire born in the 1980s in China and the 7th richest person in China with a net worth of US$16.2 billion.
According to the Bloomberg Billionaires Index, Zhang Yiming’s personal wealth is estimated at US$55 billion as of October 2022 (USD 49.5 billion, according to Forbes), making him the second richest person in China, after Bottle Jiang Zhong Suisui, director of water company Nongfu Spring, continues to occupy the top spot with a net worth of US$62.3 billion.
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