ByteDance sells loss-making securities unit to local brokerage as world’s most valuable unicorn retreats from financial services
- The securities business, which launched a stock-tracking app in 2017, marked ByteDance’s debut in the financial services industry, which is now heavily regulated
- Last year, ByteDance reorganised its sprawling business empire into six units, but it did not create a stand-alone group for its financial services business
TikTok owner ByteDance, which is pulling back from some business sectors under scrutiny from Beijing, has sold an intelligent stock market investment product to local brokerage ChinaLin Securities.
The deal priced ByteDance’s wholly-owned subsidiary Beijing Wenxing Online Technology Co Ltd at 20 million yuan (US$3.16 million), ChinaLin said in a statement posted on the Shenzhen Stock Exchange website.
The securities business operated the Dolphin Stock app, launched in 2017 as ByteDance’s debut in the financial services industry. The app “intelligently tracks the market, provides fast information and performance analysis”, according to its website.
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It had more than 12 million users in total and 320,000 monthly active users as of September 2021, China Business Journal reported, citing an unnamed source from ChinaLin.
Beijing Wenxing Online reported a net loss of 1.6 million yuan last year, although its revenue surpassed 28 million yuan, according to ChinaLin, which said it would continue to operate the app to “further improve the competitiveness of technological development and product innovation”.
ByteDance, which also owns TikTok’s Chinese sister app Douyin, is the world’s most valuable unicorn, with its private market valuation as high as US$400 billion. With 600 million daily active users on Douyin, it is one of the largest internet platforms in the country and plays an important role in influencing public opinion.
China’s financial regulators have repeatedly vowed to strengthen oversight of the sector, and have brought all financial activities under government supervision to eliminate risks.
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ByteDance has plans to close or seek buyers for its other securities operations, the National Business Daily newspaper reported, citing a company representative.
ByteDance did not immediately respond to a request for comment.
The company still owns a Hong Kong-based brokerage, Asia-Pacific Securities, which it bought in 2020 and renamed as Stellar Securities.
ByteDance entered the insurance business in 2018 with the purchase of Huaxia Insurance Brokers, and in 2020 it won an online microlending license in Shenzhen, and obtained an online payment licence through its acquisition of Chinese third-party payment service UIPay.
