In a bid to curb talent poaching by competitors, ByteDance, the parent company of TikTok, has reportedly started offering unique stock options to its AI lab employees.

The stock options are tied to ByteDance’s Seed AI division, a first for the company to issue shares linked to a specific business unit. This approach allows employees to profit from Seed’s growth without dilution from ByteDance’s other business ventures, the Financial Times reported on Tuesday.

ByteDance has given Seed employees globally the option to buy Doubao stock at $13 per unit this month. The value of these units has surged nearly 30% since last year, mirroring the faster commercialization of ByteDance’s LLMs in the cloud business and improved model performance.

The decision is a reaction to rivals like Tencent (OTC:TCEHY) luring away key research team members from ByteDance. High-profile exits include Xiao Xuefeng, a senior member of Seed’s visual AI platform, and Zhang Chi, an infrastructure specialist.

However, this compensation strategy has ignited debate as it could potentially cause internal division, discourage teamwork, and limit staff mobility within the company.

ByteDance did not ...