TikTok’s Parent Company ByteDance to Sell Securities Business
Chinese media outlet LatePost reported on Wednesday that ByteDance plans to sell its securities business. The business currently has an overall valuation of about 500 million ($77 million) to 1 billion yuan. ByteDance responded that the company is planning to shrink its financial businesses including selling the stock broking business in China.
The sale began in the first half of 2021 and the company has been in continuous contact with several investment institutions, including CICC, CITIC, Fosun Group, Niuguwang and East Money, two of which had the intent to invest.
LatePost reported that ByteDance has made it clear that it will not engage in the business of securities in the future. ByteDance’s securities business currently consists of special platform products in addition to publicly traded Hong Kong and US businesses.
The platform products are mainly Dolphin Stock, a stock market software that launched in 2017. Its main profit model is paid stock investment courses and stock recommendations. The latter service is provided by Beijing Jinmeilin Investment Consulting Co., Ltd., which was acquired by ByteDance in 2018. The company is also within the scope of this sale.
“There has not been much energy nor funds to invest in this product,” a person close to ByteDance said. Dolphin Stock has been active for four years, but the number of its daily active users is only about 133,900.
The Hong Kong and US stock business are mainly underwritten by Squirrel Securities which was incorporated in Hong Kong by ByteDance at the end of 2019 while Star Securities prepared to be established in early 2021. The latter has not been put into active use yet.
Some analysts said that ByteDance’s sale of its securities businesses was to comply with the recent scrutiny of several large tech firms. “ByteDance’s financial business will focus on serving internal users in the future,” the company added.
ByteDance also gave up its long-prepared wealth management business after the Spring Festival in 2021. At the same time, the company launched an online service of payment by installments for the field of e-commerce.
