[ FAANGs ]
but one of its Chinese equivalents: the
BATs (Baidu, Alibaba and Tencent).
“Baidu is the largest online search
engine in China,” the manager
adds, “and it stands out among
these big platform businesses as the
one that has failed to translate the
dominance into adjacent areas and
to an expansion of its business. The
characteristic that is noticeable across
this group of companies is their ability
to find new uses for their audience,
to deliver products and services and
grow their sphere of influence. Baidu
hasn’t managed to do that.”
One theory about why the company
failed to translate its dominance is
due to its centralised management
and an unwillingness to devolve
responsibility for investment and
development into the lower reaches of
the company.
Slater says the problem of this
approach could be summed up
by one of Scottish Mortgage’s
purchases last year – ByteDance,
the owner of short-form video social
network TikTok.
“The original concept for ByteDance
came from a group of Baidu
engineers,” he continues. “They went
to Robin Li [co-founder of Baidu]
back in 2012, seeking the time and the
funding to develop this idea.
“But he wasn’t prepared to take a
chance on that investment, so they left
Baidu and struck out on their own.”
Last dance
“By the time we invested in
ByteDance last year as a private
company, it was worth $75bn and
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