How Lei Jun Revived Kingsoft: A Five‑Step Strategic Turnaround

1. A Thunderous Return

On August 10, 2021 Lei Jun delivered his annual speech titled “My Dream, My Choice,” reflecting on a decade of tough decisions and the dream that propelled him forward, while also highlighting his role as chairman of Kingsoft.

2. The Kingsoft Story

In July 2011 Lei Jun photographed himself with Kingsoft founders Zhang Xuanlong and Qiu Bojun just before Qiu announced his retirement. Three and a half years later Lei returned to Kingsoft as chairman, marking a historic moment captured in a photo.

The market reacted with a brief surge in Kingsoft’s share price, which quickly fell back, underscoring the challenges the company faced despite holding nearly ¥20 billion in cash.

At the same time, Lei was preparing to launch Xiaomi’s first smartphone, a venture that many considered “crazy” because it would compete with giants like Nokia and Motorola and face a flood of counterfeit phones.

3. Investment Track Record

Between 2009 and 2011 Lei invested in more than 20 startups, 18 of which secured subsequent funding, raising over $1 billion in total. His angel‑investor reputation earned him the nickname “super angel investor.”

4. Lessons from Venture Capital

Lei emphasizes two core principles: a healthy equity structure is essential for a good company, and internet ventures should focus on incremental growth rather than protecting existing assets. He believes that large future increments attract venture capital.

5. Five‑Step Strategic Reform

1. Shut down and transfer : Concentrate on WPS, online games, and Kingsoft Antivirus, abandoning unrelated businesses.

2. Decentralize to subsidiaries : Spin off business units, grant them decision‑making authority, introduce employee share‑ownership plans, and attract external investors for potential IPOs.

3. Prioritize long‑term growth : Relinquish short‑term performance pressure and commit to a full mobile‑internet transformation.

4. Reallocate resources : After focusing on core assets, invest the freed resources into a ten‑year “All‑in‑Cloud” roadmap.

5. Build talent pipelines : Combine internal promotion with external recruitment to create a strong team.

6. Partnership with Tencent

Upon returning, Lei secured a strategic partnership with Tencent. Founder Qiu sold 9.79 % of his shares and Zhang 5.88 %, making Tencent the largest shareholder (15.68 %). The remaining shares were entrusted to Lei, giving him indirect control of 22.89 % and making him the de facto controlling shareholder.

7. Cultural Revival

Lei’s first public address to Kingsoft staff famously urged WPS employees to stand up, reigniting morale. He stresses that corporate culture is the soul of a company, shaping employee happiness and surpassing monetary incentives.

8. Governance and Execution

Lei’s reform focuses on strategic direction, organizational restructuring, incentive redesign, and a clear mission: “Aim high, stay grounded.” He treats Kingsoft like a startup, injecting ambition while leveraging its strong technical team and cash reserves.

9. Historical Context

The article draws parallels with other companies that rebounded from crises—Disney, Boeing, Sony, Ford, and Apple—suggesting that Kingsoft, with its resources and leadership, can similarly revive.