Some investors in ByteDance, the parent company of TikTok, who are looking to take over the popular short video creation and sharing service, have estimated it at around $ 50 billion, Reuters reported, citing sources familiar with the matter. This is significantly more than the value of its competitors such as Snap.
Amid pressure from the United States, ByteDance is considering selling its controlling stake to third-party firms, such as US investors, as an option to avoid sanctions against TikTok.
ByteDance has received purchase offers from several of its investors, including Sequoia and General Atlantic, sources said. Other investment companies have also shown interest in acquiring TikTok shares.
Investors estimate TikTok to be 50 times the service’s projected revenue in 2020 (about $ 1 billion). By comparison, according to data provider Refinitiv, Snap is valued at 15 times its projected revenue for 2020 – about $ 33 billion.
TikTok is growing rapidly thanks to ad revenue, and its management expects to generate revenues in the region of 6 billion in 2021, one source said. In turn, ByteDance, which owns, among other things, the Douyin application, the Chinese equivalent of TikTok, has set a goal for this year to generate revenue of about 200 billion yuan ($ 28 billion), Reuters reported earlier.
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