TikTok Partners with U.S. Firm for New Joint Venture, Oracle Takes a 15% Stake
TikTok has announced a significant deal to establish a majority American-owned joint venture, designed to enhance national security through robust data protections, algorithm security, content moderation, and software assurances for U.S. users. This comes as the platform reported over 200 million users in the United States.
The joint venture will be anchored by what the partners are calling the TikTok U.S. Data Security (USDS) organization. It will function as an independent entity, overseen by a seven-member board of directors, led by CEO Shou Chew. The board will include representatives from prominent firms such as Silver Lake, Oracle, TPG, Susquehanna International Group, DXC Technology, and MGX.
Oracle’s participation has garnered interest in Hollywood, particularly since its co-CEO, Larry Ellison, is a key investor in Paramount Skydance, the studio run by his son David Ellison, which is currently involved in negotiations with Warner Bros. Discovery.
Adam Presser has been appointed CEO of the TikTok USDS Joint Venture, where he will be responsible for securing U.S. user data, applications, and algorithms, while promoting business growth for TikTok and its associated platforms. Presser joins from TikTok and WarnerMedia. Will Farrell will serve as Chief Security Officer for the venture.
The joint venture’s three major investors—Silver Lake, Oracle, and MGX—will each hold a 15% stake. Additional investors include the Dell Family Office, Vastmere Strategic Investments, Alpha Wave Partners, Revolution, and others, including NJJ Capital, the family office of telecom pioneer Xavier Niel. Notably, TikTok’s parent company, ByteDance, retains a 19.9% interest in the joint venture.
While financial specifics were not disclosed, TikTok noted that this agreement allows “more than 200 million Americans and 7.5 million businesses to continue to discover, create, and thrive as part of TikTok’s vibrant global community and experience.”
The path to this deal has been fraught with challenges, including a review by the Committee on Foreign Investment in the United States (CFIUS) during former President Donald Trump’s administration and subsequent lawsuits. Under President Joe Biden, legislation mandated either a sale by the Chinese owner or a ban on TikTok’s U.S. operations. TikTok contested the ban, and the Supreme Court upheld the law, which set a January 2025 deadline. Trump, during his second term, chose to overlook the deadline while seeking a deal, culminating in today’s announcement.
Earlier this year, CEO Chew indicated in a memo to employees that the joint venture would likely be finalized by January 22.
