Founder of Chinese e-commerce group Pinduoduo unexpectedly resigned from the position of chairman
Coleen Huang is the seventh richest person in China, with more than $ 50 billion in net worth from his stake in an online company.
Huang’s exit comes as Pinduoduo outdid competing tech giants JD.com and Alibaba with 788 million active buyers annually on its platform last year.
But his company has come under fire for its work culture following the recent deaths of two employees.
The company said in a statement on Wednesday that Mr. Huang will explore “new long-term opportunities”, as it released figures stating that it is now the largest e-commerce company in China.
Shares in Pinduoduo, valued at nearly $ 200 billion (£ 143 billion), tumbled nearly 8 per cent after the news, wiping out about $ 4 billion of Huang’s fortune.
The former Google employee was briefly ranked as the second richest person in China last year, after increasing sales in his e-commerce business.
The number of 788 million active shoppers in Pinduoduo in 2020 surpassed Jack Ma’s Alibaba’s annual number of 779 million for the first time.
Its new features include group buying, where customers come together to buy more units at a lower price. They can also play games on the site and are sometimes rewarded with gifts.
In a message to shareholders, Mr. Huang said: “As the founder of this company, I am probably the most suitable person to take on this task by stepping out of work and comfort zone to embark on a journey of exploration.”
Pinduoduo appointed Chen Lei as the new president of the company. Mr. Chen was the Mr. Huang Study Fellow at the University of Wisconsin-Madison, and was appointed CEO in July 2020.
The e-commerce company’s rapid growth has been supported by cheap deals but it continues to incur losses.
Pinduoduo has repeatedly sought more financing, raising nearly $ 9 billion from investors since it launched on Wall Street in 2018.
The online grocery market has become very competitive in China as more shoppers purchase ingredients for daily meals from their phones after the epidemic.
But there has been widespread criticism online of the intense work culture across China’s burgeoning tech industry.
In December, the death of a Pinduoduo employee who collapsed after leaving work sparked heavy criticism of the work culture.
Many tech workers follow the “996” schedule, based on daily work from 9 am to 9 pm, six days a week.