![]() Its first three years were dominated by text- and photo-content experiments relating to the success of Toutiao, its news app, while 2016 marked a pivot to short video. The company allocates key resources to a few select priorities for a few years at a time. ![]() Selective focus.īyteDance’s broad exploration does not mean a lack of focus, however. Unlike other companies, ByteDance employees can cycle through a handful of projects every year, some of which never make it to launch. Just as quickly as it launches new products, though, ByteDance terminates nonperforming products and dissolves or reconfigures the product teams involved. It only took the company four months to launch an education app that, according to one employee, might have taken competitors 18 months to launch. Rapid iteration.īyteDance is also renowned for its speed of development and getting products to market, much of which is enabled by its SSP. Between 20, the company had at least 140 apps across 11 different verticals available in app stores. It also had two other teams incubating short-video products at the same time as it was running Douyin. It famously launched 12 entertainment content apps in its first few months as a company, and 20 apps to test foreign-market opportunities in 2015. Since its earliest days, ByteDance has searched broadly for new product opportunities and does not hesitate to send multiple teams into the same segment. These strategies have five main characteristics: Broad exploration. Relying on its SSP, ByteDance has developed unique innovation and growth strategies. It’s this virtuous loop of continued discovery and improvement that has enabled ByteDance’s success. Importantly, the relationship between the SSP and market-facing teams is symbiotic and mutually beneficial. Douyin, for example, began with just a handful of employees, and the education team began with just two. The SSP has also brought together other important teams: user-growth teams, which help identify and acquire desired users content teams, which establish partnerships to acquire new content analytics teams, which help to develop deeper user insights and sales teams, which drive monetization.Īs expected, because so many capabilities have been centralized into this large SSP, the actual product teams tend to be small and focused, especially in the exploration stage. Product teams at ByteDance work with SSP algorithm engineers to fine-tune their enormously powerful recommendation engines. In some cases, product teams customize existing technologies that have already been developed by the SSP. Subsequently, when a use case has been identified that justifies developing a new app or product feature, the product team is paired with engineers at the SSP level to develop the new product or feature. In other companies, these tasks are undertaken by the product team, which is rarely best equipped for such information gathering. For example, when ByteDance tasks a new venture team with investigating user needs and market opportunities, the team can go to the user-research specialists at the SSP for data support, saving time on market analysis. Product and related teams still focus on serving customer needs, but they rely on different SSP teams to accelerate development and growth. Cloud and shared operational tools, some of which have been developed in house, allow ByteDance to maintain this seemingly complex organizational setup. The teams are highly specialized, so that the right people can be found and flexibly deployed as needed to each new venture. Instead, many common business, technology, and operating functions (among them HR and legal) are centralized and organized into corresponding teams. The company’s product teams or units don’t control their own operating resources. Specialized Teamsīytedance uses its SSP platform differently from most companies. How has ByteDance managed to be so consistently successful? An important contributing factor, we argue, is its innovation strategy, which relies on a shared-service platform, or SSP. Respectively, Toutiao and Douyin account for 20% and 60% of the company’s total advertising revenues. But ByteDance has actually churned out one wildly successful product after another - among them its initial hit, Toutiao, the most popular news app in China, which today has 320 million monthly active users, and Douyin, a short-video app that preceded TikTok. Most users know the company only by its hit short-video app TikTok, which has been downloaded over 3 billion times globally, a feat only exceeded by Meta and its family of apps. In 2021, with 1.9 billion monthly active users in 150 countries, and an employee base of over 110,000, the company recorded an astonishing $58 billion in revenues. At just 10 years old, ByteDance, the most valuable startup in the world, has shattered records for growth.
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