Tiger Global Management has built a stake in TikTok

Tiger Global Management has built a stake in ByteDance, the Chinese owner of the viral video app TikTok, joining other global investors such as SoftBank and Sequoia Capital jostling to capitalise on the explosive popularity of short-form video. The New York-based investment group discussed the stake in a letter to investors this week, saying it had “purchased shares over the past 21 months at a low multiple of future free cash flow”… Investors valued ByteDance at $75 billion two years ago following a $3 billion funding round led by the tech conglomerate SoftBank, making it the second-most valuable start-up behind Alibaba’s Ant Financial. Tiger Global began buying shares at about half that value and has added to the position through purchases in secondary markets… ByteDance’s shares recently changed hands on secondary markets at prices giving the company an implied valuation of between $90 billion and $100 billion… The company is expected to be one of the big beneficiaries from population lockdowns put in place because of the coronavirus pandemic, as more people spend time inside on their phones. Tiger Global said it estimated ByteDance would command 19 per cent of China’s online advertising market this year — which is expected to total an estimated $81 billion… 

Miles Kruppa and Henny Sender