TikTok proprietor ByteDance cuts funding staff amid China crackdown

The ByteDance brand is seen on this illustration taken, Nov. 27, 2019. REUTERS/Dado Ruvic/Illustration

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BEIJING, Jan 19 (Reuters) – TikTok proprietor ByteDance is shrinking its funding staff and dissolving a sub-group centered on monetary returns in response to regulatory crackdowns in China, three sources aware of the matter mentioned on Wednesday.

ByteDance had divided its exterior funding arm into monetary and strategic wings, with the latter geared toward funding companies that would discover synergies with its personal.

Staff on the monetary investments staff have been informed by ByteDance executives that the staff can be disbanded they usually have been inspired to search for alternatives elsewhere, internally or externally, two of the sources informed Reuters.

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ByteDance mentioned in a press release that it was disbanding its group-level strategic funding staff and transferring staff to varied enterprise items, after a assessment earlier this month highlighted investments with “low synergies”.

It didn’t reply to a Reuters request for touch upon the dissolving of the monetary investments staff.

ByteDance’s six enterprise items, which it created in October in a serious organisational reshuffle, embody TikTok and its Chinese language model Douyin.

The overhaul of its strategic funding staff is designed to “improve collaborations between technique analysis and enterprise operations,” the corporate mentioned.

The Beijing-based firm has been decreasing the dimensions of its funding staff as Beijing has been strengthening anti-monopoly efforts to rein in company giants, 4 individuals aware of the state of affairs mentioned.

Over the previous yr, Beijing has clamped down on antitrust violations, banned non-public tuition teams and reined in a debt binge by property builders, wiping lots of of billions off the market capitalisations of a few of its largest firms, together with e-commerce large Alibaba and social media large Tencent (0700.HK).

ByteDance’s newest high-profile investments embody its $4 billion acquisition of Shanghai-based gaming studio Moonton Expertise final yr. Moonton is finest recognized in Southeast Asia for its on-line sport Cell Legends.

It has additionally acquired virtual-reality headsets maker Pico and backed Chinese language espresso chain model Method.

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Reporting by Yingzhi Yang, Xie Yu, Zhang Yan, Cheng Leng and Brenda Goh; Modifying by Jacqueline Wong, Louise Heavens and Alexander Smith

Our Requirements: The Thomson Reuters Belief Ideas.

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