ByteDance Hires Skadden Lawyer as CFO While IPO Remains in Limbo
(Bloomberg) -- ByteDance Ltd. hired Julie Gao from international law firm Skadden as its new chief financial officer, filling a position that has largely been vacant throughout the social media giant’s decade-long history.
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Gao, who counseled tech companies on initial public offerings and other types of financing, will work out of ByteDance’s offices in Hong Kong and Singapore, Chief Executive Officer Liang Rubo said in an internal memo seen by Bloomberg News. A ByteDance spokesperson confirmed Gao’s hiring.
The announcement will likely revive speculation about ByteDance’s potential IPO, which could be one of the largest Chinese tech debuts in years. But the spokesperson reiterated Monday that the company is not ready for a debut.
Gao’s appointment marked the latest leadership change at the world’s most valuable startup. Last year, ByteDance founder Zhang Yiming stepped down as CEO – and subsequently chairman – ceding the roles to his college roommate Liang. Shouzi Chew, who joined from handset maker Xiaomi Corp., now runs hit global product TikTok after a stint as CFO.
Read more: ByteDance Founder Zhang Exits Board as Challenges Mount
Gao headed the China practice at Skadden, Arps, Slate, Meagher & Flom LLP, where she worked on the IPOs of internet giants including JD.com Inc., Baidu Inc. and Didi Global Inc. She has established a working relationship with ByteDance since 2016, and worked on its acquisitions of Musical.ly and game developer Moonton.
ByteDance is now streamlining its businesses after Beijing’s yearlong crackdown on the consumer internet, which chilled expansions into new businesses.
During a tumultuous 2021, the company – one of the few tech successes outside the orbits of Alibaba Group Holding Ltd. and Tencent Holdings Ltd. – shut down most of its online tutoring operations, disbanded its venture investment arm, and sold a stock-trading app, as Xi Jinping’s government grows wary of free-wheeling expansion in the private sectors.
ByteDance had kicked off initial preparations for public listing of its domestic assets in 2021, Bloomberg News has reported. Since then, regulatory changes in China meant the TikTok owner has had to proceed cautiously, even before Didi’s IPO in New York sparked a backlash in Beijing.
Regulatory uncertainties remain one of the biggest risks for ByteDance, which reported a slower 70% revenue growth for 2021, according to a Reuters report.
Beijing’s internet watchdog is now seeking to rein in the use of algorithms to surface content for users, and stricter privacy rules have already dampened the ability of social media platforms to target ads. Last year, regulators quietly appointed a director to the board of ByteDance’s key domestic subsidiary, by injecting a nominal 1% stake in the entity that runs video-sharing platform Douyin and news app Toutiao.
Like its bigger rivals, ByteDance is increasingly turning outward for expansion. With one billion-plus global users, TikTok is ramping up its monetization efforts by unleashing more ads and introducing live-streaming shopping. TikTok is estimated to triple its ad revenue this year to $11.6 billion, accounting for more than 5% of global digital ad spend together with its sister app Douyin, according to research firm eMarketer.
Read more: TikTok’s CEO Says He Faces Competitors With ‘Bigger Muscles’
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