TikTok Finalizes Deal to Form New US Joint Venture

TikTok owner ByteDance has finally struck a deal to sell its US operations to a consortium of non-Chinese investors, which will make it possible for the app to avoid a US ban. The just-announced TikTok USDS Joint Venture LLC will license the TikTok algorithm to ByteDance and retrain it on US user data, with Oracle in charge of keeping it secure.

The new US Joint Venture includes Oracle, Silver Lake, and MGX, each holding 15%. Dell Family Office, the investment firm of Michael Dell, is also among the investors, with ByteDance retains 19.9% of the Joint Venture.

“TikTok USDS Joint Venture’s mandate is to secure U.S. user data, apps and the algorithm through comprehensive data privacy and cybersecurity measures. It will safeguard the U.S. content ecosystem through robust trust and safety policies and content moderation while ensuring continuous accountability through transparency reporting and third-party certifications,” TikTok said today in the press release.

Adam Presser, Head of Operations and Trust & Safety at TikTok, will become the CEO of the new US Joint Venture. Shou Chew, the Chief Executive Officer of TikTok, will also serve as a Director of the new entity. Notably, ByteDance will continue run TikTok’s commercial activities in the US, in addition to licensing its algorithm to the new Joint Venture.

Today’s announcement marks the end of a years-long saga to create a US-based version of TikTok that’s largely free from China’s influence. The new US Joint Venture also said today that its security safeguards will also apply to ByteDance’s CapCut and Lemon8, as well as “a portfolio of other apps and websites in the U.S.”