Rumors Swirl Around ByteDance’s Potential IPO
Chinese online content juggernaut ByteDance is rumored to be considering an IPO in Hong Kong in the first quarter of 2020. The breadth of the company’s portfolio has led some industry analysts to dub the new tech giant an “app factory” due to the rate at which they churn out new applications and iterate new versions.
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ByteDance is the parent company of the popular short-video app TikTok, or Douyin in China, Toutiao, a popular news aggregator, and many other applications. The company is said to be valued at around $75 billion, making it the most valuable startup in the world.
The core value of the company relies on its robust AI recommendations algorithms which can quickly and accurately predict user preferences and supply them with content that ultimately increases the stickiness of their platform, allowing them to generate massive advertising revenue.
ByteDance reported revenues of between $7 billion and $8.4 billion for the first half of the calendar year, according to Reuters. Meanwhile, there are growing concerns among the international community about ByteDance’s content.
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The app TikTok was accused of inciting racial violence in India, while US Senators Chuck Schumer and Marco Rubio have alleged that the company is censoring politically sensitive in China. To assuage these concerns from Washington, the Financial Times reported that ByteDance has hired a team at the law firm K&L Gates, which includes Gordon Bart, a former chair of the US House committee on science and technology, to advise on public policy.
In addition, ByteDance is planning to sell its US new aggregator TopBuzz, which boasts a readership of approximately 300,000.
ByteDance has since denied these rumors, as a company spokesperson told Reuters, “There is absolutely zero truth to the rumors that we plan to list in Hong Kong in Q1.”