TikTok’s Suitors Seem Like Less Than Ideal Fit

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Former US Treasury Secretary Steven Mnuchin is one of the few investors who has expressed interest in putting together a deal to buy TikTok from its Chinese owner ByteDance Ltd.

Photographer: Tasos Katopodis/Bloomberg

TikTok suddenly has a lot of suitors. But first…

Three things you need to know today:

• Netflix says it has 40 million subscribers for its ad-supported service
• Google is boosting security features for Android phones
• Uber will offer shuttle rides from concerts and sporting events in the US

Will anybody actually buy TikTok?

Four years ago, when then-President Donald Trump tried to force a TikTok sale, the most likely buyers were also some of the biggest businesses in the world: Microsoft Corp., Walmart Inc. and Oracle Corp. Trump ended up losing his reelection bid a few months later, all those potential deals fell apart, and four years later, the video app is more popular than ever and still under the control of its Chinese parent, ByteDance Ltd.

But TikTok’s future in the US is suddenly murky for its 170 million American users, and a possible sale is once again on the table thanks to a new law that gives ByteDance roughly one year to divest the business or face a ban in the US because of national security concerns about China.

ByteDance didn’t take the news well. TikTok is suing the US government to block the law and is funding a separate lawsuit by some of the app’s popular creators. If ByteDance ever does sell TikTok – which it claims it will not – the company would almost certainly withhold some of the key technology that made TikTok’s video feed so darn addictive.

All of that means that the chances of a sale feel slim, even with a looming ban on the horizon. But if we imagine a world in which TikTok has a new owner one year from now – and why not imagine it? – it seems less and less likely that one of the global brands we heard about the last time will ultimately win out. Antitrust has become a major concern in the tech industry (hello, Meta Platforms Inc. and Alphabet’s Google!) and ByteDance won’t hand TikTok over to someone even slightly resembling a competitor.

Perhaps that’s why we’ve only seen a handful of individual suitors pop up in recent weeks hoping to raise the necessary billions or form a syndicate to buy the TikTok brand. Here’s the current list:

Steven Mnuchin, the former US treasury secretary, says he wants to corral a group of investors to buy the company and rebuild the powerful content recommendation algorithm from scratch. Mnuchin’s advantage is that he was involved in the near-sale four years ago, meaning he (presumably) has some experience here his competitors don’t.
Frank McCourt, a real estate mogul who once owned the Los Angeles Dodgers, is also hoping to put together an investment group. Like Mnuchin, he’s not interested in TikTok’s recommendation algorithm, but admitted everything was still in the early stages. “It’s still very noisy,” he told Bloomberg this week.
Various Saudi investment groups have been linked to TikTok, and Saudi money has backed many high-profile tech companies in the past, including Twitter (now X), Uber Technologies Inc. and Softbank Group Corp. Saudi Arabia has put money into Mnuchin’s private investment firm, and the Abu Dhabi-based firm G42, controlled by United Arab Emirates royal Sheikh Tahnoon bin Zayed Al Nahyan, invested $100 million in ByteDance last year.
Eric Schmidt, the former Alphabet chairman and Google chief executive officer, admitted that he had interest in buying TikTok, but now claims that he’s abandoned that plan. Still, Schmidt has the kind of tech connections and experience that would make him an attractive partner on any kind of deal should he change his mind.

Those names aren’t going to resonate with most of TikTok’s young users, but if Mnuchin or McCourt can save the site from a US ban, they’ll certainly qualify as being TikTok famous.