ByteDance, the parent company of China’s TikTok, has disbanded establish a separate American entity to open US app operations. This restructuring aims to separate TikTok USA from Chinese parents, addressing data privacy and foreign control issues.
The move comes after years of pressure from lawmakers, who fear the Chinese government could gain access to American data. In the year 2024, Congress makes lawsordered that TikTok’s US operations be separated from ByteDance.
Under the new structure, around 80% of TikTok’s US entity is owned by non-Chinese investors, with ByteDance owning just 19.9%. The newly formed entity, “TikTok USDS Joint Venture LLC,” licenses TikTok’s recommendation algorithm from ByteDance and independently manages content moderation, and oversees data protection, algorithm security, and software controls.
The managing investor group includes Oracle, private equity firm Silver Lake, and investment firm MGX. Each has a 15% stake, totaling 45% of the US business. Here’s what you need to know about them.
Oracle
Oracle is a leading cloud computing and database company that cooperates with top companies, such as OpenAI. Oracle previously tried to acquire TikTok and has provided cloud infrastructure for the app, managing US user data.
Under the new agreement, Oracle becomes a security partner, overseeing TikTok’s compliance with US security requirements, managing data storage, and overseeing content recommendation algorithm updates.
It’s worth noting that Oracle founder Larry Ellison, now the company’s executive chairman and chief technology officer, is a prominent billionaire with ties to President Trump.
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MGX
MGX is an AI-focused investment firm based in the United Arab Emirates, which invests in semiconductors and data centers. The company was created by Mubadala (Abu Dhabi’s sovereign wealth fund) and G42, an Emirati AI company.
MGX shares in US TikTok can have a strong influence on important decisions that shape the direction of TikTok’s AI. The company has backed Elon Musk’s xAI, Anthropic, and OpenAI, and contributed to the $100 billion AI data center initiative announced by President Trump, in which Oracle is also involved.
It is also worth pointing out that MGX has a partnership with Microsoft and BlackRock.
Silver Lake
Silver Lake, a leading US private equity firm, has long invested heavily in technology companies, including Airbnb, Twitter, Dell Technologies, Tesla, and Waymo. His role at TikTok US is primarily financial and strategic, offering capital and expertise to help shape the direction of the platform.
Notably, Silver Lake has collaborated with MGX in the past, including during acquired majority stake in software and chip company Altera last year. In addition, Silver Lake has invested in G42 starting in 2021.
Other investors
- Dell Family Office: Michael Dell’s investment firm.
- Vastmere Strategic Investments: A firm affiliated with Susquehanna International Group (SIG), which is owned by billionaire Jeff Yass.
- Alpha Wave Partner: A global investment company involved in well-known companies, including SpaceX and Klarna.
- Virgo LI: The investment arm associated with Israeli tech investor Yuri Milner, who was an early backer of Facebook and Twitter.
- Capital NJJ: The family office of Xavier Niel, the French billionaire businessman who founded the telecommunications company Iliad.
- Revolution: Venture capital firm founded by AOL co-founder Steve Case.
- Merritt Way: Managed by partners of Dragoneer Investment Group, a San Francisco-based investment firm.
- Via Nova: Affiliate of General Atlantic.