How To Buy TikTok Stock?

MySpace was the first social media platform to attract a global audience when it was introduced in 2003. That was before the internet became integrated into every aspect of daily life. Ultimately, MySpace was unable to compete when additional platforms launched and social media became an international phenomenon, but it set the stage for everything that came after. 

Today, 4.8 billion unique users have at least one social media account. That’s almost 60 percent of the global population and just under 93 percent of the world’s internet users. For a long time, Facebook and Twitter, now known as X, were the top names in social media, but that changed when Gen Z joined the online community. 

Though Facebook still has the most unique users – almost three billion – another platform is in the top spot in terms of time spent interacting with content. From that perspective, TikTok has a commanding lead. TikTok users with Android devices spend more than 31 hours on the site every month. For comparison, Facebook users with Android devices spend around 18 hours a month using the app. 

TikTok’s popularity has many investors interested in getting their own piece of the action. After all, anything that attracts the attention of 18 – 29-year-olds is bound to be profitable. Is TikTok a publicly traded stock? If so, the next question is how to buy TikTok stock. 

Who Owns TikTok?

Unlike Facebook and X, the platform formerly known as Twitter, TikTok isn’t based in the United States. TikTok is a subsidiary of ByteDance Ltd., a Chinese tech company that is registered in the Cayman Islands. ByteDance has its headquarters in Beijing, China, and TikTok has two home offices – one in Singapore and another in California. However, it is still considered a Chinese company, which has resulted in intense scrutiny by the US government.

China’s National Intelligence Law requires Chinese companies to provide customer data to the Chinese government upon request, and the US government is concerned that could include TikTok user data. China’s foreign minister denied that the law applies to TikTok data, and TikTok’s CEO assured the US government that user data is stored by a US-based third party that could put a stop to any attempt by Chinese authorities to confiscate user information. 

Nonetheless, the issue has created a complex relationship between TikTok and the US government. There is occasional talk about banning the app in the United States, and certain US government employees are not permitted to have or use the app. TikTok has already been banned in India, which meant the loss of 200 million users, and several other countries are considering a similar prohibition. What does that mean for investors? 

Is TikTok a Publicly Traded Stock?

TikTok is owned by ByteDance, and ByteDance is a privately held company. It isn’t traded on any public exchange. However, there are US firms with ownership interest in ByteDance, and those firms do trade on public exchanges.

KKR is a well-established alternative asset investment management firm with more than $500 billion in assets under management. It owns a large and varied portfolio, including positions in real estate, hedge funds, credit, energy, and infrastructure. Roughly $165 billion of KKR’s portfolio is in private equity investments, which includes an investment in ByteDance. KKR bought into ByteDance in 2018, then increased its position in 2020. 

A second option is to invest in Softbank – a Japanese company that specializes in e-commerce and telecom. Softbank is also a holding company that manages the Vision Funds. These funds invest in private equity companies, including ByteDance, as well as publicly-traded companies – mostly tech start-ups. Though these funds have delivered profit for shareholders, the 2022 tech downturn was painful for Softbank investors. The best way to reduce risk is to include Softbank in an otherwise diversified portfolio. 

Will TikTok Get Bought?

TikTok would be a valuable acquisition for any company interested in entering or expanding its social media presence. While TikTok’s growth is beginning to level off in terms of new users, it has barely started to explore generating revenue from advertising. TikTok and its counterpart in China, Douyin – also owned by ByteDance – realized a total of $29 billion in advertising revenue for 2022. That figure is expected to increase by 25 percent for 2023. 

The various regulatory issues could be resolved if TikTok is owned by a Western company, but the trouble is that its price tag is too high for most of the organizations that would be interested in an acquisition. Some industry experts have estimated TikTok’s value at $50 billion, which limits potential suitors. Those able to pay that price – companies like Google and Microsoft – are unlikely to take on the challenges that come with managing a social media company. 

Will TikTok Go Public?

Leadership for both ByteDance and TikTok have repeatedly stated that there are no plans for a TikTok IPO. Fortunately, there are other publicly-traded social media companies that have strong potential to deliver profits for shareholders. 

Best Social Media Stocks In 2023

X (Twitter) is no longer publicly traded, and most analysts agree that it isn’t the right time to buy Meta (Facebook) stock, but investors who want to buy social media stock still have plenty of options. Some of the best social media stocks for 2023 include: 

• Etsy – e-commerce platform for crafts and other handmade items

• Match Group – parent to a collection of global dating sites, including Match.com, Tinder, Hinge, and Plenty of Fish

• Pinterest – a social platform based on collecting and sharing images 

An alternative opportunity is to invest in the next big social media platform. Of course, it’s hard to say what platform that may be. Interactive Corp (IAC) is focused on identifying and funding the most promising concepts, which makes it easy for investors to participate in the future of social media without devoting the time required for extensive research.  Year-to-date, IAC is up 21 percent.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.