Jia Yueting, founder of China’s internet conglomerate LeEco, stepped down as chairman and has quit from all of his positions from LeEco’s listed business Leshi Internet Information & Technology Corp. on Thursday afternoon. Earlier in May, he has already resigned as CEO of the listed company.
Jia’s resignation was implied in his earlier Weibo post, which is also known as China’s equivalent of Twitter. “I quit as CEO and left positions of even more important roles at LeEco’s listed company so that I can be fully engaged in the mass production and sales of FF 91,” wrote Jia in a Weibo post on Thursday morning.
That FF 91 is an electric car planned by Los Angeles based electric vehicle startup Faraday Future which LeEco invested in.
On the same day, LeEco’s automobile division LeSEE announced on its WeChat public account that Jia will become global chairman of the LeEco automobile ecosystem with immediate effect.
Four days ago, assets worth RMB 1.24 billion (USD 182 million) owned by Jia, his wife and three LeEco companies were seized by a Shanghai local court as a request from China Merchants Bank. The bank claimed that LeEco refused to pay back loan interests despite urging them several times.
Jia’s “breakup” with LeEco’s listed company is regarded as a major setback for LeEco which aims to be a global Internet giant under Jia’s ambitious leadership.
China’s netizens had given Jia the nickname “Jiabusi” or “China’s Steve Jobs” to reflect his ambition to conquer the global market.
In October 2016, LeEco announced its official expansion into the U.S. with a massive launch event in San Francisco. However, just a month later, Jia sent an internal memo to his staff admitting the tech giant’s extremely quick expansion and huge capital challenge.
Its crisis was eased by China’s leading real estate company Sunac China. It announced a strategic investment in LeEco in January 2017, and became LeEco’s second largest shareholder in a deal worth RMB 16.8 billion (USD 2.4 billion).
Since Sunac China’s investment, its board chairman Sun Hongbin started to intervene in Jia’s management of LeEco. He urged LeEco to cut budgets and sell businesses that should be sold.
This was a major surgery to cut down LeEco ecosystem, as Jia had planned in the internal memo sent to his staff.
Beside its major video streaming content business, LeEco has branched out to smart televisions, set-top boxes, smartphone manufacturing, an e-commerce platform where it sells its own electronics, VR headsets, and content production in 2016. It is also entering the online finance and cloud computing sectors.
To date, LeEco is mainly running its video streaming, smartphone, smart televisions, sports, and EV businesses. It has closed its American branch and laid off hundreds of employees.
(Top photo from Baidu Images)