TikTok has finalized a deal to create a majority American-owned joint venture designed to secure U.S. user data and prevent a nationwide ban of the popular short-video app, its Chinese owner ByteDance said on Thursday.
The agreement marks a major milestone for TikTok, which has been locked in political and legal battles in Washington since 2020 over concerns that U.S. user data could be accessed by the Chinese government. TikTok is used by more than 200 million Americans.
Under the deal, a newly formed entity, TikTok USDS Joint Venture LLC, will be responsible for securing U.S. user data, apps and algorithms through enhanced data privacy and cybersecurity measures. ByteDance said the venture would be majority owned by American and global investors, though it disclosed limited details about the broader divestiture.
Ownership structure
American and global investors will collectively hold 80.1% of the joint venture, while ByteDance will retain a 19.9% stake. Three managing investors — Oracle, private equity firm Silver Lake and Abu Dhabi-based investment firm MGX — will each own 15%.
Additional investors include the Dell Family Office, Vastmere Strategic Investments, Alpha Wave Partners, Revolution, Merritt Way, Via Nova, Virgo LI and NJJ Capital, TikTok said.
Former TikTok USDS executives Adam Presser and Will Farrell have been appointed chief executive officer and chief security officer of the venture, respectively. TikTok CEO Shou Chew will also sit on the board, continuing to oversee the company’s global businesses and strategy.
Data security and operations
TikTok said the joint venture will retrain, test and update the app’s content recommendation algorithm using U.S. user data, with the algorithm secured in Oracle’s U.S.-based cloud infrastructure. The venture will act as the backend operator for the U.S. app, handling U.S. user data and the recommendation algorithm.
In September, Reuters reported that while ByteDance would maintain ownership of TikTok’s U.S. business operations, it would cede control over data, content and the algorithm to the new venture. A separate ByteDance-owned division is expected to continue managing revenue-generating activities such as advertising and e-commerce, with the joint venture receiving a portion of revenue for its technology and data services.
Political backing
A White House official told Reuters that both the U.S. and Chinese governments had signed off on the deal. The Chinese Embassy in Washington did not immediately comment.
President Donald Trump praised the agreement in a social media post, saying TikTok “will now be owned by a group of Great American Patriots and Investors, the Biggest in the World.” He also thanked Chinese President Xi Jinping for approving the deal.
The agreement follows years of uncertainty that began in August 2020, when Trump first sought to ban TikTok over national security concerns. Although Congress passed a law in April 2024 requiring ByteDance to sell its U.S. assets or face a ban, Trump later chose not to enforce it. The measure was upheld by the Supreme Court.
Trump said last year that the joint venture arrangement met the law’s divestiture requirements. The White House previously said the venture would operate TikTok’s U.S. app.
TikTok’s growing political footprint
Trump, who has more than 16 million followers on his personal TikTok account, has credited the platform with helping him win reelection. The White House launched an official TikTok account in August, underscoring the app’s growing political relevance despite years of scrutiny.
