China’s Bytedance has closed a funding round that values the company as the world’s largest internet startup.
Local and international investors that include Japan’s Softbank Group, New-York-based KKR & Co., U.S. private equity firm General Atlantic and China-based investment firm Primavera Capital Group have committed to invest $3 billion in the company at a $75 valuation, according to a person familiar with the matter. The new valuation makes Bytedance a few notches above ride-sharing firm Uber Technologies, which is currently valued at $72 billion—the largest for a private startup worldwide, according to CB Insights.
Bytedance plans to use the proceeds for its expansion into new business lines and further boost its growth at home and abroad, according to the person. The company is best known for its Toutiao news app and the Douyin short video platform, which is branded as Tik Tok in foreign markets and has 500 million active users as of July. But Bytedance recently beta launched several e-commerce apps including budget shopping site Zhidian and social commerce platform Xincao — ventures that are well outside its news and entertainment empire.
A Bytedance spokeswoman declined to comment on the company’s fundraising efforts.
Meanwhile, Bytedance has also attracted the attention of smartphone giant Apple. In October, Apple’s Chief Executive Tim Cook visited Bytedance’s Beijing headquarters during his trip to China. The two companies haven’t announced a formal partnership, but the visit sparked a social media frenzy, with photos of Cook shaking hands with Bytedance employees and talking to founder Zhang Yiming widely circulating on China’s twitter-equivalent Weibo and Tencent’s WeChat messaging app.Thanks to Bytedance’s recent success, Zhang’s net worth has jumped 70% to $4 billion from a year ago, according to the Forbes China Rich List.
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To be sure, Bytedance isn’t without challenges of its own. This year, the company has repeatedly come under regulatory pressure for hosting a swathe of inappropriate content on its apps, with authorities ordering it to permanently shut down the popular joke-sharing app Neihan Duanzi in April. The Douyin app was also singled out for criticism by state media after some users were injured by imitating the activities shown in its clips. The company has already put in place a series of measures to better protect users, which include enhanced privacy settings, parental controls and a risk warning system.
