The billionaire founder behind TikTok and its parent company ByteDance is far less known than the video sharing tool, which has become the most downloaded app in the world.
TikTok has had worldwide success, but not many people outside of China know the man behind the app.
How did a locally trained software developer outsmart the numerous news portals and video apps from Tencent Holdings and Sina Corporation?
Although Zhang Yiming is the tenth richest man in China with a net worth of $ 16.2 billion (S $ 22.6 billion), he is extremely private and little is known about his personal life.
We took a closer look at the business activities of the technology entrepreneur. It was certainly not an overnight success – there was a lot of trial and error, losses and victories for him to get to where he is today.
Zhang has been ambitious since he was young
Zhang Yiming was born in Fujian Province, China in 1983. Zhang's parents were civil servants – his father worked for the community science and technology commission before he opened an electronics processing factory and his mother was a nurse.
During Zhang's childhood days, the regular topics his parents talked about were mainly friends who came across new technology overseas or developed a specific product.
His family occupied him with stories about entrepreneurship, and that gave him an interest in business and innovation from a young age.
Unlike other parents with an institutional background who strictly control their children, Zhang's parents encouraged him to try new things and allowed him to choose his own way of life at a very young age.
Photo credit: Reuters
During his school days, his colleagues wanted to become scientists. Even though he was good at chemistry during his school days, he thought mixing chemicals in test tubes for chemical reactions was senseless and even dangerous.
He wanted to have a sense of participation and responsibility in what he did, and chemistry didn't give him anything.
“Your behavior and your spending have to change quickly. And the computer is the fastest, ”said Zhang.
In 2001, he enrolled at Nankai University in Tianjin, where he studied microelectronics before changing his major to software engineering. He graduated from university in 2005.
When I was in college, I wanted to do something valuable. For example, I could make a chip or make a breakthrough in medicine.
– Zhang Yiming, according to a source
He acquired a property search business and launched 99fang.com
The next year, he got his first job at college with an online travel booking startup called Kuxun ("cool search").
I was one of the first employees. Initially I was an ordinary engineer, but in the second year I was responsible for around 40 to 50 people who were responsible for back-end technology and other product related tasks.
– Zhang Yiming, according to the South China Morning Post
His boss liked his job and was promoted to technical director a year later.
Zhang attributes this job to teaching him sales skills that he later used to expand ByteDance.
"I remember meeting the customer with the sales manager in late 2007," Zhang said, according to the South China Morning Post.
This experience let me know which sales are good sales. When I founded Toutiao and recruited employees, these examples helped me a lot.
– Zhang Yiming, according to the South China Morning Post
There was one time in Kuxun when Zhang wanted to book a train ticket home. At that time it was difficult to buy a ticket at the station and he didn't know when a resale ticket would be available online.
As with any search engine, the Kuxun search engine requires the user to enter information each time to search for the information they need and search for resale tickets in real time.
He wanted to create a search engine that would notify him immediately when a ticket was available, instead of having to search online repeatedly. During his lunchtime, he wrote a small program for an hour.
After he wrote the program, he left the office. In less than half an hour, he received a notification that new tickets were available and went to the train station to buy his ticket.
He didn't have to buy a scalper ticket and didn't have to sit in front of the computer.
After this time, Zhang Yiming kept thinking about how to discover information more efficiently.
Zhang left Kuxun for Microsoft in 2006 because he wanted to know how companies do business.
However, he felt choked by the company's corporate rules. His unwillingness to work with routines or repetitive things was evident.
He soon left Microsoft to join the startup Fanfou, a microblogging website that was the first Twitter clone in China. However, the start-up did not see its fame and ultimately failed.
A few years later, in 2009, when Kuxun was to be acquired by Expedia, Zhang took over Kuxun's property search business and founded 99fang.com ("Ninety-Nine Rooms"), his first company and property search portal.
Zhang's entrepreneurship was evident in the companies he worked for after graduation – they were all startups.
How he founded byte dance
While at 99fang.com, Zhang observed that many users migrated from computers to smartphones.
He started working on mobile development at 99fang.com. In six months, he launched five mobile applications, including renting a house and buying a house. It reached 1.5 million users and 99fang soon became the most popular real estate app.
At the same time, Zhang believed that Chinese smartphone users had difficulty finding information in mobile apps in 2012, and search giant Baidu mixed search results with undisclosed advertising.
Zhang wanted to create a platform whose results are based on artificial intelligence and dissuade user behavior from searching.
Photo credit: Reuters
For this reason, he hired a CEO to run 99fang.com because he wanted to focus on building another company.
In 2012 he founded Bytedance in his four bedroom apartment in Beijing. It was his fifth attempt at entrepreneurship.
As its company name suggests, Bytedance products relate to data. His vision was to share relevant content with users based on recommendations generated by artificial intelligence.
However, most venture capitalists did not share this vision and could not secure funding until the Susquehanna International Group agreed to invest in the startup.
The company raised $ 5 million (S $ 6.9 million) from its billionaire investors Yuri Milner and Susquehanna Investments in its Series A financing round, which contributed another $ 10 million in 2013.
With his vision and funding, Zhang launched the Toutiao News app in August 2012 and attracted more than 13 million users daily within two years.
Toutiao, translated into Mandarin Chinese, essentially means "heading".
It wasn't long before Zhang caught global attention when he made it to Forbes China 30 Under 30 List in 2013.
The next year, Sequoia Capital, which Zhang rejected for the first time, made a $ 100 million investment in the company.
With more funds, Zhang launched the Toutiaohao platform to attract more content generated by influencers and users.
Photo credit: China – Worldtimes News
A popular example was "Zhuguan Baba" (swineherd father), a young pig farmer in northern China, whose contributions to pig breeding attracted millions of readers to Toutiao.
By 2016, Zhang had launched Toutiao Video, which was later renamed Xigua Video (also known as Watermelon Video).
Xigua Video was a short-form video platform that hosted a variety of video clips with an average length of 2 to 5 minutes. Since then, Xigua Video has been expanded into long-form videos. It allows content creators to monetize their videos when the videos get a lot of views.
In the same year, Zhang started a project to locate missing people on the Toutiao platform. Thanks to Toutiao, 3,573 missing people were found.
As part of his interest in becoming a global news platform and using the same AI to improve usability, Zhang also launched TopBuzz, a content discovery platform for videos, articles, breaking news, and GIFs outside of China – in the U.S., Brazil, and Japan .
Towards the end of 2016, Zhang invested in India's largest national language platform (native languages such as Tamil, Hindi, Punjabi, etc.) for Dailyhunt content aggregation, as well as the Indonesian news recommendation platform BABE, without users subscribing to individual news sites.
In 2017, Cheetah Mobile sold the News Republic global news app to Bytedance for $ 86.60 million to leverage Toutiao's AI technology.
With Toutiao as China's largest AI-based information network, the takeover of News Republic has helped expand its reach to more overseas markets and provide users with more diverse and relevant content.
"We don't push information through inquiries, but through news recommendations," said Zhang Bloomberg in 2018.
Despite its focus on news, ByteDance has no journalist on its payroll.
The most important thing is that we are not a news company. We are more of a search company or a social media platform. We do very innovative work. We are not a copycat of a U.S. company, both in terms of products and in terms of technology.
– Zhang Yiming in a Bloomberg 2018 interview
Bytedance Toutiao Search started in 2019 as part of its Toutiao portal – a news aggregator.
Another early Bytedance app, Neihan Duanzi, where users could share jokes, memes, and humorous videos, was closed by Chinese censors in 2018. At its peak, Neihan Duanzi had over 200 million users in 2017.
Douyin and its global version TikTok saw phenomenal success
In February 2017, ByteDance acquired the Los Angeles start-up Flipagram for an undisclosed amount.
Flipagram is an app that allows users to turn their photos into slideshows and videos. However, users have shared their creations on other social networks, so Flipagram has decided to integrate a social component into the app. It was harder than expected and expensive.
Sequoia Capital, Toutiao's investor, was also an investor in Flipagram and helped link the two companies.
Zhang immediately recognized the challenges and opportunities, said Filpagram founder and CEO Farhad Mohit. Zhang instinctively understood what flipagram tests needed to understand.
With the acquisition, Toutiao can help Flipagram-Videos find the right audience, even without a social component, by integrating Flipagram-Videos into personalized content feeds. Flipagram, in turn, will give Toutiao a line to the US market.
"He is one of those calm, incredibly thoughtful and young entrepreneurs," said Mohit about the founder of Bytedance.
Integrating an overseas acquisition is not an easy task, but Zhang has had some experience in India (Dailyhunt) and Indonesia (BABE).
Bytedance then renamed Flipagram Vigo Video (known in China as Huoshan) and launched it in July 2017 in Southeast Asia, allowing users to edit photos and videos, add effects, add music to their creations, and share them with friends and family .
During this time, Snapchat became increasingly popular with teenagers in many countries.
Zhang started developing an app that allowed users to create short videos with lip syncing, comedy, and talent. To appeal to the young audience, he integrated AI to recommend similar content to users based on their preferences and search queries.
The app was developed in 200 days. The app called Douyin was first launched in China in September 2016. It had 100 million users within a year, with more than a billion videos viewed every day.
When Zhang saw great resonance for Douyin, he started to create a global version of it.
Then TikTok was born in 2017. It was launched on international markets – mainly in Asia and the United States. Interestingly, TikTok is not available in China and its data is stored outside of China.
Credit: TikTok
Zhang was very busy when he also launched the Helo social media platform on the Indian market in June 2018, where you can create, upload and share a variety of content – flashcards, GIFs, short videos, jokes, memes, status updates , Wishes, quotes and news.
At the same time, a Shanghai-based start-up called Musical.ly was popular with teenagers in America and Europe. It started in 2014 and is a platform where users can present their dance, singing and music talents in short videos.
Within two months of launching TikTok, ByteDance spent an estimated $ 1 billion on the purchase of Musical.ly. The aim was to use the young user base of the digital platform.
In August 2018, TikTok merged with Musical.ly to create a larger video community. Existing users were migrated to new Tiktok accounts with a new user interface and the data was combined in one app. While maintaining the name TikTok, the core function of both apps is retained: short videos up to 15 seconds.
"For a long time, I only watched TikTok videos without creating them myself because it is primarily a product for young people," Zhang said, according to the South China Morning Post.
Then he started making his own TikToks – and he asked his managers to do the same.
“However, later we made it mandatory for all members of the management team to create their own TikTok videos and they have to win a certain number of“ likes ”. Otherwise they have to do pushups. It was a big step for me. "
In the same year, Bytedance closed $ 3 billion ($ 4.19 billion) in funding from SoftBank Group Corp. and other major investors.
TikTok became the third most downloaded non-game app in the world after WhatsApp and Facebook Messenger.
It has suddenly become a global cultural phenomenon. The app has been downloaded 1.57 billion times, and almost half of it – 689 million – appeared in 2019.
During the COVID-19 pandemic, TikTok reached 2 billion downloads and became the most installed app.
TikTok has surpassed WhatsApp as the most downloaded app in the world, according to the data collected by SensorTower.
The app offers the opportunity to stay in touch with friends and learn about the latest developments in the fight against the virus when the world was locked in a global space.
People, especially in Wuhan and Italy, made TikToks an isolated life and showed the rest of the world what their lives were like in quarantine.
He stops at nothing and continues to move forward
Despite multiple failures and attempts at entrepreneurship, he rises every time and moves on to the next step.
As we have seen so far, Zhang showed hunger for growth and he would not stop being a news platform. He has further developed Bytedance into a leading provider of content platforms – as we can see from the acquisitions and starts.
We have a group chat where we see videos every day made by users outside of China from countries like Brazil and Vietnam. It makes you realize that the world is a very big place and it broadens your horizons. It makes our lives a lot more interesting.
– Zhang Yiming, according to the South China Morning Post
Thanks to intelligent acquisitions and the explosion of TikTok's popularity, Bytedance has quickly reached an enormous user base and worked on all sorts of new apps to achieve the next success.
Zhang identified gaps and wanted to fill those gaps by creating new platforms to meet user needs. He constantly finds new reasons to break and competitors to fall.
In 2018, ByteDance surpassed Uber as the world's most valuable startup worth $ 75 billion (S $ 104 billion).
The company developed a music streaming service and released a messaging app called Flipchat, which is currently only available in China and directly challenges WeChat from Tencent Holdings.
In 2019, a Snapchat clone called Duoshan even came out, which allows users to record and send short videos to each other that disappear after 72 hours.
In the same year, the company also launched Lark, a competitor for Slack Work Messaging with its subsidiary Lark Technologies, based in Singapore. Lark's document and calendar features are very similar to Google Docs and Calendar.
Today, Bytedance is worth more than $ 100 billion (S $ 139 billion) for recent private equity transactions. Bytedance even reported a net profit of $ 3 billion (S $ 4.2 billion) on sales of $ 17 billion (S $ 23.7 billion) in 2019, more than twice as much as in 2018.
It looks like the 37-year-old entrepreneur won't stop and can't stop being innovative.
He names the US search engine giant Google as his model company.
“Google is a company without borders. I hope Toutiao will be as limitless as Google. Personally, I hope to do things that are interesting and meaningful to society, ”said Zhang.
This is clearly not the end of Zhang's business endeavors. What could possibly be the next Bytedance app that would disrupt the industry?
Selected image source: Medium / Getty Images
