Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money

66% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

  • IPO Watch
  • disruptive innovation

Is TikTok Owner ByteDance Going Public With A $250 Billion Valuation?

In the last few weeks, ByteDance’s value has surged as private investor confidence soars. According to reports, ByteDance founder Zhang Yiming is now considering going public via an initial public offering (IPO). 

This article was originally written by MyWallSt. Read more market-beating insights from the MyWallSt team here.

Just last month, ByteDance was valued at $200 billion. Now, with a $250 billion valuation, the technology company is technically more valuable than Coca-Cola (NYSE: KO) and Netflix (NASDAQ: NFLX). 


What is ByteDance?

ByteDance is a technology company based in Beijing, China but is legally domiciled in the Cayman Islands. The company operates a number of different content platforms that educate and entertain users. 

ByteDance’s most popular app is TikTok, which has experienced explosive growth since the start of the pandemic. TikTok has around 700 million users, with the U.S. being its biggest market. It is also the seventh-largest social platform in terms of users, ahead of other apps that have been around a lot longer than it, including Twitter and Pinterest. 

The video-sharing app has been the subject of many debates after former President Donald Trump tried to ban it in the U.S. following concerns of privacy breaches. 


Is ByteDance going public? 

ByteDance’s hiring of Chew Shou Zi as its Chief Financial Officer has fueled IPO rumors as he was the one to oversee Xiaomi Corp’s market debut. This hire has given investors confidence in the company as they know ByteDance is going to have a seasoned CFO. 

Even though Zhang has been exploring taking just segments of the business public, like Douyin in Hong Kong, it’s now looking likely that he will list the entire company. Investors are very keen on investing in Chinese tech IPOs lately, as was made evident by Kuaishou Technology’s market debut last month. The company’s stock more than doubled from its IPO price, pushing its valuation up to $140 billion. This event will have encouraged the TikTok parent company to consider listing, especially after hearing that some private investors are demanding the equivalent of a $350 billion market cap in order to sell their ByteDance stock. 

ByteDance has been busy with acquisitions lately, last month snapping up major mobile gaming studio Moonton for $4 billion. This deal further proved its ambitions in moving into the video gaming industry and will help it rival Chinese-owned Tencent with this mission. 


Would ByteDance be a good investment? 

If we look at ByteDance’s financials, the company looks like it would be a good investment. The social networking company more than doubled its revenue to around $35 billion in 2020 and grew its operating profit to around $7 billion from less than $4 billion the previous year. 

However, we have to briefly look at the bear case for this company too. ByteDance may still be confronted with regulatory uncertainty from the U.S. The government has tried to force ByteDance to sell to a U.S.-owned company, such as Oracle or Walmart, to ensure the privacy of its users. In addition, Beijing regulators have also recently undertaken efforts to curb China’s influential tech giants. These problems might represent hurdles for the company in the future which may put a certain amount of risk behind the company. If ByteDance can overcome these challenges, and continue becoming the biggest social app in the world, this should be a very popular market debut. 


MyWallSt gives you access to over 100 market-beating stock picks and the research to back them up. Our analyst team posts daily insights, subscriber-only podcasts, and the headlines that move the market. Start your free trial now!



Disclaimer Past performance is not a reliable indicator of future results.

CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.

CMC Markets does not endorse or offer opinion on the trading strategies used by the author. Their trading strategies do not guarantee any return and CMC Markets shall not be held responsible for any loss that you may incur, either directly or indirectly, arising from any investment based on any information contained herein.

*Tax treatment depends on individual circumstances and can change or may differ in a jurisdiction other than the UK.

Continue reading for FREE

  • Includes free newsletter updates, unsubscribe anytime. Privacy policy

Free ebook

Tricks of the trade: 7 interviews with the world’s top traders

Get it now

Related articles