In 2009, when Jeff Yass was still a major Republican donor, his company, Susquehanna International Group, invested in a Chinese real estate startup that claimed to have a sophisticated search algorithm.
The company, called Jiujiufang, had promised to help buyers find their ideal homes. Employees of a Chinese subsidiary of Yas were deeply involved behind the scenes in creating Jiujiufang, owning the idea for the company and handpicking a chief executive, documents show. The CEO was not the company’s “true founder,” they wrote in an email.
As a real estate site, 99fang failed. But the company is significant because of what happened next, according to a lawsuit filed by a former contractor for Haina. The suit alleges that 99fang’s chief executive and its search technology later ended up at another Haina investment, ByteDance.
ByteDance, the owner of TikTok, is currently valued at $1.3 trillion, according to CB Insights, a company that tracks venture capital.$225 billionone of the world’s most valuable startups. ByteDance is also at the center of a storm on Capitol Hill, where some lawmakers believe the company poses a threat to U.S. national security. They are considering a bill that could break up the company. Zhang Yiming, who was chosen by Hainer to run 99Fang, later became the founder of ByteDance.
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Court documents reveal the complicated origin story of ByteDance and TikTok. The documents include emails, chat messages and memos from within Haina. They describe a failed business experiment, tensions between the founders and their investors, and a powerful search engine that just needed a use.
The documents also show that Hainer was more involved in the creation of TikTok than previously known, as reported extensively by The New York Times and other media.Susquehanna International Group owns about 15% of ByteDanceBut these court documents make it clear that Haina was not a passive investor. It supported Zhang Yiming’s career success and approved his idea to establish ByteDance.
Tens of billions of dollars in profits are at stake as lawmakers debate whether TikTok gives its Chinese owners the right to sow chaos and spread misinformation among Americans. For Yass, founder of Susquehanna International Group, billions of dollars in potential profits will depend on the outcome of this debate.
Yas is a former professional poker player and also this election cycleThe largest donationAn individual who has donated more than $46 million as of the end of last year, according to OpenSecrets, a research group that tracks political funding.
Susquehanna International Group has submitted Yass’s emails to the court as part of the case, according to court documents. But those emails are not included in the public documents, making it unclear how involved Yass was in the creation of ByteDance.

The documents come from a lawsuit in Pennsylvania. Haina’s former contractors sued the company for handing over their cutting-edge search technology to ByteDance without compensating them. Haina denied the allegations, saying ByteDance did not receive any technology from the real estate website 99fang. “These claims are without merit and we will vigorously defend ourselves,” a Haina spokesman said.
The court records were unsealed this month after The Times downloaded them and began interviews. Since then, Mr. Hainer’s lawyers have said the documents were released inadvertently. The judge resealed them on Tuesday.
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Lawyers for both parties declined to comment for this article. ByteDance, Yass and Zhang Yiming either did not answer questions or did not respond to requests for comment.
While both sides in the case dispute the origins of Bytedance’s technology, court documents make clear that the company itself grew out of 99Fang’s real estate business. “Our search, image processing, recommendation and other functions are very powerful,” Zhang Yiming wrote in a 2012 email, “but their application in the real estate field is very limited.”
Zhang Yiming proposed the plan that same year to provide web users with lighthearted content, rather than matching buyers with homes. He developed two prototype apps, one for funny and embarrassing pictures and another for jokes. He described the new project as a “sister enterprise” of 99fang and would share technology with that real estate site.
Years later, a director of Susquehanna International Group’s Chinese subsidiary wrote to colleagues that the real estate website led to “the birth of ByteDance.”
How it all started
In 2005, Susquehanna International Group established its Chinese subsidiary, Susquehanna Asia, to invest in Chinese start-ups.
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One of its early investments was Kuxun, a portal focused on job postings, housing ads and travel. Zhang Yiming, then in his early 20s, was the website’s technical director, and Susquehanna Asia saw him as a promising talent.
He left the company to join Microsoft. But in 2009, when Haina was preparing to spin off Kuxun’s real estate division into an independent company, the investment company poached Zhang Yiming back and appointed him as the CEO of the new company, Jiujiufang.
“We have re-hired the top engineer of the housing channel to lead the (99house) technical team,” employees of Susquehanna Asia wrote in an internal memo.
But records show that Zhang Yiming’s relationship with Susquehanna Asia is quite complicated.
He claimed to be the founder of Jiujiufang but had only a small stake in the company, documents show.
In 2011, Gong Ting, managing director of Susquehanna Asia, expressed dissatisfaction with Zhang Yiming in a dispute that appeared to be about equity. “Neither Kuxun nor Jiujiufang was founded by him,” Gong Ting wrote in a letter to colleagues. The details are unclear, but he ended the letter by seeming to suggest parting ways with Zhang Yiming: “We should let him go.”

By 2012, Zhang Yiming was no longer interested in real estate. After learning about the life of Apple founder Steve Jobs, he wrote in an email to Susquehanna Asia that he realized he needed to change careers. As people bought mobile phones in large numbers, opportunities in the social media industry continued to emerge. He suggested that he needed to find a different use for 99fang’s search technology.
The extent to which Haina has guided Zhang Yiming’s career over the years has never been part of ByteDance’s story. Wang Qiong, an employee of Haina Asia, once wrote in an article:Blog PostsIn her first post, she described meeting Zhang Yiming in a cafe to discuss what would become ByteDance. Zhang sketched a prototype idea on a napkin, she wrote.
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Wang Qiong wrote in an internal investment memo that Zhang Yiming had sought Haina’s “understanding and permission” to leave 99fang and start a new company.
Connotative jokes and a gamble
Shifts in focus are common in venture capital. What’s less common is a sea change from real estate to social media. The most successful startups (Facebook, WhatsApp, Alibaba, etc.) have all changed their business scope many times, but not their goal.
Court documents show that by March 2012 the fledgling project had a new name: Xiangping.
The investment memo shows that a prototype application developed by Zhang Yiming called “Neihan Duanzi” seems to be popular with users.Internet ArchiveSome of the early versions of Xiangping can still be found in it.
Wang Qiong wrote in an investment memo that by selecting content for users, Xiangping can start viral dissemination and increase user “stickiness.” In other words, instead of letting users find what they want to watch, the new company makes choices for them.
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“Social networking technologies will be used to track user behavior, predict user interests, and build relevance and recommendation engines,” the memo reads.
While ByteDance’s technology has improved several times, TikTok still serves up videos that users want to watch and share. Curating information for users is at the heart of Congress’s efforts to ban TikTok. Some lawmakers have expressed concerns about such a powerful algorithm in the hands of a company with Chinese ownership.
Susquehanna Asia valued Mr. Zhang’s startup at about $9 million in 2012 and invested just over $2 million in it. Since then, Susquehanna’s lawyers wrote in court filings, the firm has “invested hundreds of millions more.”
The rest is history. The startup changed its name to Bytedance, acquired the lip-syncing app Musical.ly, built TikTok on it, and by 2018 had become one of the world’s most valuable private tech companies.
Haier’s bets on untested founders are not uncommon. But what’s unique about ByteDance is that the payoff has been so high.
“Part of it is that they saw some potential,” said Steven Kaplan, who studies private equity and venture capital at the University of Chicago Booth School of Business. “Part of it is that they got lucky.”
What happens next?
The case in Pennsylvania court may ultimately be decided by a jury, but a trial date has not yet been set.
The House of Representatives passed a bill in March that could force ByteDance to sell TikTok, and the Senate could vote on the bill as early as next week.

In addition to campaign donations, Yass has also provided significant funding for the libertarian Club for Growth’s large advocacy campaign to prevent TikTok from being banned. The campaign has had mixed results so far, with many House members supported by the Club for Growth voting in favor of the ban.
As with much of the legislation currently underway in Congress, former President Trump is a wild card in whether the TikTok ban will eventually pass.Tried to forceByteDance sold TikTok, but later changed its position. He also admittedMet with Yas brieflybut said they never discussed TikTok.