TikTok IPO: Revenue, Users, Valuation & How to Invest

Initially, the app was called ‘Musical.ly’, starting out as a lip-syncing video app. Acquired by ByteDance in 2018, the app was rebranded as TikTok. In its current format, TikTok allows users to create, watch and share videos. The app uses an algorithm to provide a feed of content specific to the user’s interests, which has helped drive high engagement. The TikTok app has also been the starting point for many of the most recent viral crazes and influencer-driven content.

In 2021 the platform had 4.7 billion in revenue and 902 million users and was worth 18.8 billion US dollars. In 2023 it is likely to report more than 12 billion in revenue with over 2 billion users and valued at 65.7 billion US dollars.

The bulk of TikTok’s revenue is generated from advertising and in-app purchases. A rapidly growing user base has also led to a massive jump in revenue. More engaged users mean that the advertising becomes more valuable and makes it a more attractive place for companies to spend bigger chunks of their advertising budget.

Similar to Meta, Snap, and Alphabet, the data collected on users of TikTok allows companies to direct its advertising and marketing towards very specific customer prospects, instead of a general audience. Again, this makes it more likely that the advertising campaigns will succeed and increase sales figures, ensuring companies keep spending money to advertise through TikTok.

As TikTok is owned and controlled privately by ByteDance, it’s best to look at some of the current top shareholders of ByteDance to get an idea about the leading investors: Coatue, General Atlantic, Hillhouse, Sequoia Capital and Softbank.

When is the TikTok IPO?

Initially, the TikTok IPO was planned for 2020. The company was looking to take advantage of its fast-growing popularity as one of the most downloaded apps in the world. However, tensions between the US and China have meant that the IPO of TikTok (and ByteDance, TikTok’s parent company) has been put on hold.

The US has concerns that user data from the app will be readily accessed by the Chinese government, breaching privacy laws. TikTok’s China equivalent and counterpart Douyin is basically the same and shares an algorithm. But China and America monitor and regulate companies in very different ways.

It’s a particular concern with an app like TikTok because the app itself permits control of users’ smartphone cameras, microphones and sometimes tracking activity across other apps. But, it’s difficult for TikTok/Douyin and ByteDance to effectively split the business to meet both contrasting rulesets.

However, it seems the majority of requirements have now been met for TikTok to be listed on a US stock exchange, and the IPO is eagerly awaited. Many investors are excitedly hoping that TikTok will finally be listed on a US stock exchange sometime during 2023, but this isn’t officially confirmed.

What is the TikTok share price?

At present investors are required to invest in shares of Bytedance and not TikTok, as TikTok is currently not entirely a separate entity. The general perception is that before the IPO ByteDance will be spun off into a separate entity and shareholders in Bytedance will then be able to convert some or all of their shares into TikTok stock before the IPO lits.

TikTok’s parent company ByteDance, has an estimated valuation as high as $300 to $400 billion US dollars and the stock price has been soaring over the last few years.

ByteDance recently gave its employees an option to buy their stock in the company at a price of US$155 per share and the Smart IPO platform has managed to obtain shares for our clients at this price.

Buy shares in TikTok today!

The Smart IPO platform enables you to buy shares in Bytedance which therefore gives you the ability to convert those shares into TikTok before the IPO lists. You can open an account with Smart IPO easily online and we have offices located globally and an account manager will be provided to you based on your country of residence.