TikTok’s new US owners won’t control key parts of the business, according to a leaked memo

• TikTok told staff it signed a deal to spin parts of its US business into a joint venture with new investors.
• Oracle and investment firms Silver Lake and MGX will serve as managing investors in the new entity.
• But the new owners aren’t going to manage TikTok’s key money-making businesses: e-commerce and ads.

Is TikTok really selling its US business? Kind of.

TikTok has reached an agreement that would give it a new set of owners in the US as part of a joint-venture agreement. Larry Ellison’s Oracle, Abu Dhabi investment firm MGX, and private-equity firm Silver Lake are all coming on as managing investors in the US spin-off.

But how much influence will these investors have over the money-making side of the business? Not much, according to an internal memo TikTok CEO Shou Chew sent to employees on Thursday, viewed by Business Insider.

The new investors will focus on national security-related tasks, such as data management and algorithm training, while TikTok’s current owner, ByteDance, will remain in charge of key business lines, including e-commerce and advertising.

Here’s what Chew told staff about the arrangement:

The US joint venture, built on the foundation of the current TikTok US Data Security (USDS) organization, will operate as an independent entity with authority over US data protection, algorithm security, content moderation and software assurance, while TikTok global’s US entities will manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing.

As laid out by Chew, TikTok’s new investors aren’t going to be in the driver’s seat on core business lines like TikTok Shop or ad sales, even if they may still participate in the profits of the business. TikTok global, which will remain under ByteDance, will still run the show.

“Advertisers will continue to connect with global audiences with no impact,” Chew also wrote in the memo.

The setup, which focuses a lot more on national security-related concerns than business tasks, may be why the White House said in September the deal would be valued at $14 billion, far lower than the $50 billion estimate from Morningstar analysts in June. My colleague Peter Kafka previously dug into the TikTok valuation question.

In the proposed structure of the deal, which Chew said should close in late January, Oracle, Silver Lake, and MGX will get a combined 45% stake in the US joint venture. Affiliates of existing ByteDance investors will grab around 30% ownership, and an unnamed group of new investors will take 5%.

ByteDance will maintain ownership of just under 20% of the US business, but retain oversight of the rest of the world and manage TikTok US’s e-commerce, advertising, and marketing strategies.

That sounds like a pretty good setup for a company that spent much of 2024 and 2025 fighting to keep its US business alive after Congress passed a law forcing it to sell its US app or face a potential ban.

The question of who will actually be in charge of different parts of the business is paramount to employees at TikTok and ByteDance. Will they get a new boss or organizational structure after an agreement closes?

“Even though there’s a deal, it doesn’t say concretely yet what it means for us,” one TikTok staffer said. They added that they weren’t anticipating much change.

TikTok, ByteDance, and MGX did not respond to requests for comment. Oracle and Silver Lake declined to comment.