Some investors of TikTokโs parent company ByteDance seeking to take over the video app are valuing it at about $50 billion, 50 times its projected 2020 revenue of about $1 billion,ย ย Reuters report Wednesday citing people familiar with the matter.
ByteDance, one of the most valuable startups in the world, has received a proposal from some of its investors, including Sequoia and General Atlantic, to transfer majority ownership of TikTok to them, the sources said.
It has also fielded acquisition interest in TikTok from other companies and investment firms, the sources said.
A $50 billion valuation would be significantly more than peers such as Snap Inc.
It is unclear whether ByteDanceโs founder and CEO, Yiming Zhang, will be satisfied with the offer. ByteDance executives recently discussed valuation projections for TikTok that exceed $50 billion, one of the sources said.
Last week, The Information reported that TikTok could be split off from ByteDance and sold to investors in the United States in order to shield it from regulatory wrath.
ByteDance said to consider plan to protect TikTok by selling it to US investors
ByteDance was said to be discussing the plan with a small group of its US investors, who would buy a majority stake in the app.
Insiders told The Information that the plan was tentative and preliminary, representing only one possible solution to the threat that US might follow India in banning TikTok entirely.
ByteDance's sale discussions have reportedly included Zhang Yiming, the company's founder and chief executive, and Neil Shen, a board member and a partner at Sequoia Capital's Chinese branch.
The plan would require investors such as Sequoia, General Atlantic and New Enterprise Associates to form a consortium, with ByteDance potentially maintaining a minority stake.
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