The CEO of Chinese short-video platform Kuaishou, Su Hua, has announced that he will step down from the company’s day-to-day operations. The co-founder of the social media company has become the latest prominent Chinese tech billionaire to renounce a top position as the government’s crackdown on the industry intensifies.
The 39-year-old entrepreneur released a statement on Friday, saying that he would step down as CEO to focus on long-term strategy and new initiatives for the company. He will stay on as the chairman, with his voting rights unchanged.
Cheng Yixiao, the app’s creator and long-time collaborator with Su, will take over as CEO. Cheng, 37, will continue to report to Su as chairman, according to the statement.
Su said he would concentrate on strategic planning and new initiatives, whereas Cheng would be in charge of the company’s day-to-day operations.
Cheng invented the Kuaishou app in 2011 as a GIF maker. Two years later, when Cheng and Su first met, the two transformed it into a video-sharing and streaming platform similar to TikTok, featuring short-video content.
The Beijing-based company went public on the Hong Kong Stock Exchange in February, in the city’s largest initial public offering (IPO) so far this year. According to GlobalData’s deals database, the company raised HK$42bn (US$5.4bn). Kuaishou is the biggest competitor to ByteDance – parent company of the globally popular TikTok short-video app – with a large following primarily in China’s rural communities.
The pivot into the booming short-video market was a massive success for the Kuaishou duo. According to Forbes, Su now has a net worth of US$6.4bn. Cheng is estimated to be worth US$5.1bn.
The company is also working on an international expansion – much as domestic competitor ByteDance did with TikTok. Kuaishou is known overseas as Kwai and Snack Video, and announced in June that it had reached 1 billion monthly active users globally.
The new reshuffle, however, comes at a time when the company is facing difficulties. Confronted with China’s crackdown on the social media and tech industry and intensifying competition from ByteDance and Bilibili, Kuaishou reported 7bn yuan (US$1.1bn) in losses in the second quarter.
Its share price is now trading at only 25% of its IPO price. The company said in August that its short-term revenue would continue to be affected by Beijing’s ongoing regulatory changes.
The government’s squeeze on the tech industry is likely the reason why Su – who was at the height of his career – decided to step away, becoming the fourth CEO of a large Chinese tech company to give up his position this year.
The tech resignations started last year when the former Alibaba CEO, Jack Ma, disappeared from the public eye last October. The outspoken billionaire was often perceived as a thorn in the Communist Party’s side, having publicly criticised the government on various occasions.
Following the headline-grabbing last-minute suspension of Ant Group’s IPO (Alibaba’s financial arm), Jack Ma was missing in action for a year until he was recently spotted in Spain. Soon after Ant Group’s IPO was choked off, Alibaba was slapped with a record-breaking US$2.8bn antitrust fine. Since then, virtually every sector in China’s tech industry has been affected by crushing new regulations, from online entertainment to the edtech sector.
Having learned from Jack Ma’s disappearance, various high-profile tech CEOs announced that they would step down this year.
Colin Huang, the former chairman and CEO of the ecommerce giant Pinduoduo, announced in March that he had given up both positions to explore future growth ideas.
In May, ByteDance’s Zhang Yiming also announced that he would relinquish his position, saying that it “would enable [him] to have a greater impact on longer-term initiatives”.
Richard Liu, founder and CEO of JD.com, another dominant Chinese ecommerce platform, said in September that he would step aside also to focus on the company’s long-term strategy.
Given this trend all eyes are now on Pony Ma, the CEO of tech titan Tencent, who co-founded the company in 1998 and has been at its helm ever since. Tencent owns China’s immensely popular WeChat “super app”, which boasts over 1 billion active users.
Unlike Jack Ma, however, the Tencent CEO has been careful to maintain a low profile over the years. He seldom appears in the media and is known for his secretive lifestyle.