China’s internet giant Baidu announced yesterday the spinoff of its global business unit.
According to the company’s statement, DU Ad Platform (DAP), Baidu’s international mobile ad platform for mobile developers, will be separated from the global business unit to become a new company called “Xiaoxiongbowang (小熊博望)”. The new company will operate independently and capitalize on synergies to strengthen its mobile ecosystem. Yong Hu, former general manager of the global business unit, has been appointed as CEO of the company.
Shenzhen Capital Group is the lead investor and will hold 53 percent of the shares with its associated funds and institutions. Baidu remains a key shareholder with relatively high equity. Huaxing Capital serves as the primary financial advisor for the spinoff.
Baidu’s global ad tool business ranks top among similar businesses by the number of global downloads for its various apps and services. As a gateway for Chinese mobile developers to grow overseas, the machine learning-backed DU Advertising Platform has become the largest local mobile advertising platform empowering the global distribution of ad content. At the end of 2017, Shenzhen Capital Group ranked first in the industry by its portfolio size, encompassing both listed and unlisted companies. The partnership is believed to enhance resource integration and asset management capabilities for Xiaoxiongbowang.
Hu and his team have long focused on the development of Chinese global mobile applications and the operation of international mobile advertising platforms. Over the years, they have gained substantial amount of experience in helping Chinese mobile applications go global. Through the spinoff, Baidu hopes to unleash the potential of its leading business lines, raise broader funding and support, and accelerate the construction of Baidu’s open ecosystem. Xiaoxiongbowang is expected to advance the development of global mobile applications and the operation of DAP, building easier access for Chinese mobile application developers who look to expand overseas.
The new global business unit will highlight Baidu’s AI push as it continues expanding its global AI portfolio. Their current offerings include AI-powered emoji Android keyboards Facemoji and Simeji, and AI-powered search engine tools. The unit will lay the groundwork for introducing Baidu’s core business including the global expansion of DuerOS and Apollo. The new global business unit will be headed by Chenghuan Zhang, who will report to Ya-Qin Zhang, president of Baidu.
Baidu has been intensively focusing on overseas R&D and talent acquisition. Currently, Baidu has two R&D centers in Silicon Valley with more than 200 staff members dedicated to R&D in internet security and self-driving cars. In October last year, Baidu opened a new R&D center in Seattle to expand its reach in AI and cloud computing.