ByteDance , the Chinese parent company of TikTok , has struck a deal for a separate US entity to manage the app's operations in the United States. The restructuring aims to separate TikTok's US operations from its parent company in China , responding to concerns about data privacy and foreign control.
The move came after years of pressure from lawmakers who feared the Chinese government's potential access data Americans'. In 2024, Congress passed a law requiring TikTok's operations to be separated from ByteDance. Otherwise, TikTok would have to stop operating in the US.
See also: TikTok: Shutdown and censorship shortly after the deal with the US was closed
TikTok USDS Joint Venture LLC: The new joint venture
Under the new structure, about 80% of TikTok’s US entity is owned by non-Chinese investors, with ByteDance retaining only 19.9%. The newly formed entity, “TikTok USDS Joint Venture LLC,” licenses TikTok’s recommendation algorithm from ByteDance and is responsible for content management, data protection, algorithm security, and software controls.
The investor management team consists of Oracle, private equity firm Silver Lake and investment firm MGX. Each holds a 15% stake, for a total of 45% of the US business.
Oracle
Oracle is a leading cloud computing and database that also partners with other major companies, such as OpenAI. Oracle had previously tried to acquire TikTok and already provides cloud infrastructure for the app, managing user data in the US. Under the new agreement, Oracle acts as a security partner, verifying TikTok’s compliance with US security requirements, managing data storage and overseeing updates to its content recommendation algorithm.
See also: UpScrolled: Increase in downloads after TikTok acquisition in the US
It is worth noting that Oracle co-founder Larry Ellison, who is now the company's executive chairman and chief technology officer, has connections to President Trump.
MGX
MGX is an investment firm focused on artificial intelligence. It is based in the United Arab Emirates and invests in semiconductors and data centers. The firm was formed by Mubadala (the sovereign wealth fund of Abu Dhabi) and G42, an artificial intelligence firm. MGX’s stake in TikTok US could give the firm influence over key decisions that shape TikTok’s AI direction.
The company already backs Elon Musk's xAI , Anthropic and OpenAI , and contributed to a $100 billion AI data center initiative announced by President Trump. Oracle is also a member of that initiative. MGX also has partnerships with Microsoft and BlackRock .
Silver Lake
Silver Lake, a leading US private equity firm, has long invested in technology companies including Airbnb, X (formerly Twitter), Dell Technologies, Tesla and Waymo. Its role in TikTok US is primarily financial and strategic, providing capital and expertise to help shape the platform’s direction. Notably, Silver Lake has worked with MGX in the past, including acquiring a majority stake in software and semiconductor company Altera last year.
See also: TikTok: New age verification technology in Europe
Additionally, Silver Lake has invested in G42 since 2021.
Other investors
- Dell Family Office: Michael Dell's investment firm.
- Vastmere Strategic Investments: A company affiliated with Susquehanna International Group (SIG), which is owned by billionaire Jeff Yass.
- Alpha Wave Partners: A global investment firm that partners with notable companies, such as SpaceX and Klarna.
- Viro LI: The investment arm associated with Israeli tech investor Yuri Milner, who was an early backer of Facebook and Twitter.
- NJJ Capital: The family office of Xavier Niel, a French billionaire businessman who founded the telecommunications company Iliad.
- Revolution: The 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: A subsidiary of General Atlantic.
