Lip-syncing app Musical.ly has been sold to Chinese social media giant Toutiao for somewhere between $800 million and $1 billion.
The acquisition of Musical.ly is the largest venture abroad thus far for Chinese startup Beijing ByteDance Technology, the company behind China’s top news aggregator service Toutiao. According to Bloomberg, ByteDance is currently valued at $20 billion.
Musical.ly was founded in Shanghai by Louis Yang and Alex Zhu in 2014, and claims 60 million users, the majority of which are based in the U.S. According to Bloomberg, the app exploded in popularity among American teenagers in 2016, prompting expansion beyond its flagship app and into a service for creating and sharing personal music videos. The 100 million-strong U.S. user base will be added to Toutiao’s own 120 million readers and viewers in China, combining a social media component with its foundational news offering.
Jinri Toutiao, which translates to “Today’s Headlines,” was able to thrive without the backing of any of China’s larger players: Tencent Holdings (TCEHY), Baidu (BIDU), and Alibaba Group Holding (BABA). Now, all three are trying to refine their own news apps to compete with Toutiao, which distinguished itself through extensive use of AI, tailoring news for its user base.