Chinese Tycoon Abruptly Quits Tech Giant He Founded

The founding father of high-flying Chinese e-commerce group Pinduoduo has stepped down unexpectedly as chairman.

Colin Huang is China’s seventh-richest person and is worth quite $50bn from his stake within the online firm.

Mr. Huang’s exit comes as Pinduoduo overtook rival tech giants JD.com and Alibaba with 788m, annual active buyers, on its platform last year.

The founding father of high-flying Chinese e-commerce group Pinduoduo has stepped down unexpectedly as chairman.

Colin Huang is China’s seventh-richest person and is worth quite $50bn from his stake within the online firm.

Mr. Huang’s exit comes as Pinduoduo overtook rival tech giants JD.com and Alibaba with 788m, annual active buyers, on its platform last year.

But his company has been criticized for its work culture following the death of two employees recently.

Mr. Huang will explore “new, long-term opportunities”, the corporate said during a statement on Wednesday because it released figures stating it had been now China’s largest e-commerce firm.

Shares in Pinduoduo, valued at on the brink of $200bn (£143bn), fell by nearly 8% following the news, wiping about $4bn from Mr. Huang’s wealth.

The former Google employee was briefly ranked the second-richest person in China last year, following a surge in sales at his e-commerce business.

Pinduoduo’s 788m active buyers in 2020 overtook Jack Ma’s Alibaba’s 779m annual shopper count for the primary time.

Its novel features include team buying, where customers close to get more units at a lower cost. They can also play games on the site and are sometimes rewarded with gifts.

In a letter to shareholders, Mr. Huang said: “As the founding father of this company, I’m probably the foremost suitable person to require on this task by stepping out of the business and therefore the temperature to start a journey of exploration.”

Pinduoduo has appointed Chen Lei as the company’s new chairman. Mr. Chen was a classmate of Mr. Huang’s at the University of Wisconsin-Madison and was appointed chief executive in July 2020.

The e-commerce firm’s rapid climb has been powered by cheap deals but it continues to post losses.

Pinduoduo has repeatedly sought more funding, raising roughly $9bn from investors since its Wall Street stock exchange launch in 2018.

The online grocery market has become highly competitive in China as more shoppers buy daily meal ingredients from their phones following the pandemic.

But there has been widespread online criticism of the extreme work culture across China’s booming tech industry.

In December, the death of a Pinduoduo employee who collapsed after leaving work sparked heavy criticism of its work culture.

Many tech workers follow a “996” schedule, supported working daily from 9 am to 9 pm, six days every week.

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