Happy Labor Day, from super warm San Francisco!  Right now I’m sitting in an outdoor cafe, soaking up the sun while wearing a mask writing this.

This past week has been all about TikTok so I want to give everyone a quick summary :

What is the latest?

• Three bidders are on the table:
  • Microsoft and Walmart
  • Oracle, Sequoia Capital, and General Atlantic 
  • Triller and Centricus Asset Management
• Tiktok is suing Donald J. Trump (President of the United States) and Wilbur L. Ross Jr. (Secretary of Commerce).
• Kevin Mayer (former Disney executive) resigned as TikTok U.S. CEO. And Vanessa Pappa (former YouTube executive) is now in charge.
• China imposed new restrictions on technology exports. Article 18 covers some forms of artificial intelligence and Article 21 encompasses data analytics and content recommendation.
• The deadline is September 15 for Bytedance to sell or cease its American operations.

What would the potential winning bidder be buying?

• By June 2020, TikTok’s total number of U.S. monthly active users had soared to 91,937,040. Today, based on quarterly usage, 100 million Americans use the TikTok application. (See P.6 on the TikTok lawsuit against the US government)
• Operations and assets for the US, Canada, New Zealand, and Australia.
• It is not clear if the acquirer will be licensed or have access to the algorithm. As Alfred said on Bloomberg, the crown jewel of this deal is really the 15 million lines of machine learning code.

Why does it matter?

• Regardless of what happens to TikTok, this will change the course of internet sovereignty and China-US tech history.
• It will greatly impact going forward to how the US government will handle WeChat and Huawei.
• China may retaliate even more and establish its own version of CFIUS.  It will challenge US-China cross-border investments, operations, M&A, and IPOs going forward.

This week a total of 12 startups raised $183.2M in funding, 2 M&As:

• $99.4M goes to 5 Enterprise startups
• $58.5M goes to 2 Healthcare startups
• $3.3M goes to 1 Gaming startup
• $7.5M goes to 1 FoodTech startup
• $3M goes to 1 AgTech startup
• $11.5M goes to 2 Other startups