Is TikTok A Public Stock?

A stock, also known as equity, represents the owned fraction of an individual in a corporation, which entitles the person to their respective proportion to the company’s assets. Since TikTok has taken over the internet world for years now, many have come forward to present the question of who owns Tiktok stock.

But first, let’s clarify the background of the rising social media platform.

What’s TikTok?

TikTok is a company owned solely by ByteDance Limited, which is recognized to be a privately-held Chinese Startup partially funded by Sequoia Capital China.

The app provided users with the ideal platform for creating their unique and various short-form video content ranging from dance to education.

Are they in the market?

Because it is presently managed by a private corporation, there is no report that a TikTok stock, dubbed “TikTok Global,” has claimed a position in the stock market.

However, ByteDance Limited didn’t dismiss the idea of introducing TikTok Global to initial public offering or IPO within the United States. Yet, there’s still no definite date when this project would take place.

Apart from this, numerous withheld information concerning the TikTok Global IPO is still being debated, including its ticker symbol and the stock exchange it will trade on. Yet, if we’d take a look at other Chinese companies such as Alibaba, we could assume that there’s a high possibility that TikTok Global would set foot on the New York Stock Exchange (NYSE) soon.

It’s worth noting, though, that once the agreement has been fulfilled, the pre-IPO funding round determined that the business would retain 80% of the whole TikTok stock.

How to buy TikTok Global stock?

If you want to be one of the first to buy TikTok Global shares, you may do so through Oracle and Walmart, two American firms who aim to hold 20% of the company.

It’s no secret that Oracle and Walmart aim to buy TikTok Global, where 12.5% of it would go to the former, and the remaining 7.5% would be left to the latter under the current plans.

Several analysts calculated that TikTok Global’s value could be estimated starting from a minimum of $60 billion.

Moreover, since it was proposed as a U.S. company, TikTok Global would have access to owning the company’s North American operations.

With former President Donald Trump banning TikTok in the United States, TikTok Global was formed. Trump suspected that TikTok’s algorithm threatens the country’s national security because ByteDance is based in China.

Why TikTok is valuable

For some, the thought that a 20% share of TikTok Global could amount to $60 billion or higher seems inaccurate if they’re unaware of the factors contributing to this calculation.

According to one of ByteDance’s press releases, the app has successfully marketed itself. It grew from an initial 11.263 million users back in January 2018 to over 100 million this August 2020. Among these numbers, India is considered the most extensive TikTok user base, where app users jumped to 611 million in 2020 alone.

Moreover, roughly 150 million people use Douyin, TikTok’s Chinese version, per day. Obelo stated that 41% of users worldwide between the age of 16 and 24 own TikTok accounts, letting the company expand its operation to 155 other countries by 2019.

Analysts believe that these numbers rose due to TikTok’s practical algorithm, which is the asset that utilizes the machine-learning platform to track then identify the videos that users would be interested in watching.

Hence, Business of Apps reported that the company has a retaining rate of 26%, where an average user typically spends at least 52 minutes within the app each day. Business of Apps estimates that Android users have even spent 68 billion minutes on the app in 2019, given that users are introduced to more than 1 billion videos every day.

In the end, TikTok Global could increase in value as a significant number of analysts see the TikTok algorithm’s potential in the e-commerce space, where customers would be likely enticed to purchase a product and improve a company’s net profit.

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