What Is TikTok? TikTok is a video-based social media platform owned by ByteDance, a Chinese company that also owns Xigua Video, Lark, Douyin, and Toutiao. In fact, TikTok is considered an international version of Douyin, which was released in 2016 and focuses on Chinese residents. TikTok was launched in 2017 to several markets outside of China.
The TikTok mobile app is rapidly growing and mostly popular among young people. Users share content with each other by uploading videos to their profiles. Videos often feature users performing dances, music, or challenges. The app comes with a broad range of filters and editing features that account holders can use to manipulate their content (often to add humor).
It’s available in more than 50 languages, which has helped it reach one billion active users and about 4.8 billion inconsistent users.
How to Buy TikTok Stock
The company’s global popularity and rapid growth make TikTok an attractive investment opportunity. Unfortunately, you cannot buy TikTok stock because it is a subsidiary of a private company.
In many cases, you can indirectly invest in subsidiary companies like TikTok. You might not have a chance to buy stock in the company, but you could buy shares of the parent company. You cannot take that approach with TikTok, though, because ByteDance is a private company that does not sell its shares to the public.
So, does this mean no one can invest in TikTok or ByteDance. Not necessarily, but you cannot take a direct approach to investing in these companies.
How To Invest In TikTok Indirectly
One option is to invest in one of ByteDance’s own investors. For example, SoftBank Group has helped fund ByteDance. The investment company’s money has helped ByteDance build and promote digital products like TikTok.
As long as TikTok and ByteDance remain profitable, you can expect shares of SoftBank Group’s to enjoy some of the spoils. That means you can potentially make money from TikTok’s success while you wait for the company to go public and start selling shares.
Buy Shares On Private Markets From Employees
Another option is to buy shares from ByteDance employees and private investors. Although private, ByteDance distributes shares to some people, primarily its major investors and managers. Many companies use stock options to compensate employees. Instead of getting paid a higher wage, these people receive shares in the company. When the company goes public, they have shares that they can sell or hold.
In some cases, it’s possible to buy privately held shares before a company goes public. Although ByteDance’s shares aren’t liquid right now (meaning that they aren’t publicly traded with a deep pool of buyers and sellers), you can potentially buy them from private shareholders.
It’s a bit of a stretch, though, so don’t bank on making this a critical part of your investment strategy. You might not ever find someone willing to sell their shares before ByteDance and TikTok go public.
Is TikTok Publicly Traded?
No, TikTok is not a publicly traded company. Since its parent company is private, it’s nearly impossible for the average investor to put money into TikTok or ByteDance. That’s unfortunate since TikTok has grown quickly and has the potential to create enormous value for shareholders.
It isn’t necessarily impossible for you to invest in TikTok, but you cannot do so directly until the company goes public. There are some rather indirect investment options, though.
Who Owns TikTok?
TikTok is owned by ByteDance, a Chinese company that develops artificial intelligence (AI) and video-centric applications. Across all of its platforms, ByteDance has nearly 2 billion monthly active users.
ByteDance got its start when two friends worked together to build a real estate search engine. Over a few years, they duo and several others developed big data algorithms that could find and organize news according to a user’s preferences. This product soon became Toutiao, an extremely popular Chinese news aggregator worth more than $20 billion.
In addition to pulling content from the internet and social media platforms, Toutiao has agreements with independent content producers. It currently has partnerships with approximately 20,000 conventional media outlets and 800,000 media content developers.
Other products owned by ByteDance include:
- Gogokid – a platform that helps students learn English by pairing them with native English speakers.
- Xigua Video – a video-sharing platform with content longer than videos shared on TikTok.
- Lark – a collaboration platform that started as an internal tool for ByteDance but is now available to the public.
- Resso – a social music streaming app.
How Can You Invest in TikTok Parent ByteDance?
ByteDance is a private company that does not trade on public markets. Investing in ByteDance, therefore, would require putting money into investment companies that own pieces of the business.
Alternatively, you might find opportunities to buy the stock on private markets. This assumes that someone holding ByteDance stock wants to sell. Availability, therefore, is not guaranteed.
What Is TikTok Stock Price in Private Markets?
It’s nearly impossible to determine the potential stock price of TikTok on private markets. As a private company, it does not have to release all of its financial information. Without accurate data regarding expenses and revenues, analysts can only guess at the company’s value. Estimates show that ByteDance probably has a value of $400 billion in private trades.
Alternatives to TikTok Stock
Because it’s difficult to invest in TikTok and other privately held companies, you might want to consider some alternatives that trade on open markets.
Meta Platforms
Meta Platforms is the recent name adopted by Facebook’s parent company. Meta Platforms owns several social media apps, including Facebook, Instagram, and WhatsApp.
Meta Platforms’ stock peaked on September 10, 2021 at nearly $379 per share. At the time, it was still known as Facebook.
Facebook underwent rebranding in late October after a whistleblower leaked information showing that Facebook sought young members even after internal research showed that the platform harmed those users.
Other leaks focused on Facebook breaking SEC rules and sabotaging regulation efforts. The stock price had already been on a slight decline. The negative press hasn’t harmed the company too much, though, and shares remain above $300.
Meta Platforms trades on the Nasdaq, making it easy for investors to purchase shares.
Snap
Snap owns the popular social media app Snapchat as well as the companies Spectables, which makes smart glasses, and Bitmoji.
Snap went public in early 2017. Shares began trading at about $27 each but dipped below $6 over its first year. Share prices peaked on October 24, 2021 at $83.11. Since then, the stock has lost more than half its value.
According to analysts’ estimate, SNAP has enormous upside potential.
Pinterest uses virtual pinboards to let people share images, text, links, and short videos. The company was founded in 2009 and went public in 2019. The service has about 478 million active monthly users.
Pinterest shares initially sold for a little less than $25. It started gaining value in mid-2020, taking an upward trajectory until it peaked at $85.90 on February 19, 2021. Since then, the price has experienced several fluctuations.
Like SNAP, PINS has serious upside when a discounted cash flow forecast analysis is applied.
Twitter is a social media platform that purposefully restricts the length of posts to 280 characters. It has about 397 million active users. Despite its cultural popularity, it’s one of the smaller social media apps.
Twitter was founded in 2006 and had its IPO in 2013. The first shares sold for about $40. The stock enjoyed a short-lived increase in value before making a slow decline to about $15 in 2016. Twitter stock spent most of 2021 over $60 with a peak at nearly $78 and a valley at about $46.
Much like other social media stocks, Twitter has won over the forecasts of analysts more so than investors. At the time of research, the upside for Twitter was as much as 60%.
Bumble
Bumble is a dating app founded by Whitney Wolfe Herd, who previously served as Tinder’s VP of marketing. Many people think of Bumble as a feminist dating app because it only allows women to approve matches. Either person can choose to accept or deny a match in same-sex connections.
Bumble became a publicly traded company during April of 2019. Shares initially sold for $24.40. Bumble’s value fluctuated slightly for about a year before it began a steady incline. Shares reached their highest value on February 19, 2021 at $85.90.
When forecasting Bumble share price using a discounted cash flow analysis, the ceiling for BMBL share price is $56, representing a return of over 70% for investors at the time of research.
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