Who would have seriously seeing it coming that Uber will be moving aside for China’s ByteDance as now the world’s highest-valued tech startup? The new fund brings ByteDance’s value to $75 billion, which takes it past Uber’s most recent figure of $72 billion.
That’s according to reports from Forbes and Bloomberg both of which claim that the company has completed a $3 billion investment that values the company at $75 billion. A source with knowledge of the deal confirmed the round and also suggested that the value is pre-money, which, adding the round, would put ByteDance’s valuation at $78 billion. That’s ahead of Uber’s most recent $72 billion valuation, although the ride-hailing giant is being tipped to go public next year at a valuation of up to $120 billion.
There were once previous reports that ByteDance was in talks with KKR and General Atlantic, and they were joined by SoftBank in the round — with Bloomberg reporting SoftBank plans to put in a total of around $1.8 billion which will include buying out some existing investors via secondary sales. On that note, the publication also claims that the round remains open to additional investors so the amount raised could increase.
ByteDance operates a range of digital media platforms, but it is best known for Toutiao, its AI-based news aggregator that has become one of China’s most-used apps with over 120 million users, and short video platform TikTok, which recently gobbled up Musical.ly which ByteDance acquired via a $1 billion acquisition last year.
But it isn’t just popular in China. That TikTok-Music.ly merger is aimed at growing the platform globally, while ByteDance operates a number of Toutiao-like global services too. It has carefully fenced its Chinese and international versions, though. TikTok (500 million monthly users) and Chinese equivalent Douyin (300 million MAUs) are restricted to their respective markets, principally due to censorship concerns.
ByteDance has done the impossible and become an internet giant in China, breaking the dominance of Baidu ,Alibaba and Tencent — the so-called BAT big three — but U.S. giants are also paying attention. Because imitation is the sincerest form of flattery, Google is said to be (controversially) developing a Toutiao-like news app for China, while some other reports this week suggested that Facebook is hatching a TikTok clone.
It hasn’t been plain sailing, though. ByteDance has been reprimanded by the Chinese government which has seen its services given app store bans, and the company’s content moderation team grown from 6,000 to 10,000. That’s part of the growing pains and in many ways, interest from Beijing is definitely a compliment that shows just how influential the company has become.