A Triller IPO may be coming in the next few months, amid increasing uncertainty over TikTok’s future.
Reuters reports that Triller is in discussions with blank-check acquisition companies about a merger. The process would take the US-based social media company public, while also converting a future acquirer into a publicly-traded entity. Triller is seeking to capitalize on the uncertainty of TikTok’s future in the United States.
The Trump administration is seeking to force China-based ByteDance to divest from TikTok. The Administration says the app presents national security concerns, though TikTok is currently suing the US government to keep the ban at bay. Following India’s ban on TikTok, Triller rose to massive prominence in the country.
Triller has been around since 2015, but the service only has a fraction of the millions of TikTok users. Triller hopes the uncertainty over TikTok’s future will drive more users to its platform. That hope appears to be paying off, as Triller has reported record growth in the last few months.
Reuters reports that Triller is working with investment bank Farvahar Partners on its potential deal. It is speaking with several ‘special purpose acquisition companies (SPAC),’ according to the report. SPACs are shell companies designed to raise money for an initial public offering (IPO).
“Triller’s SPAC negotiations are happening alongside discussions with investors about a private fundraising round, led by investment bank UBS Group AG, in which the Los Angeles-based company is seeking to raise around $250 million,” Reuters sources say.
So far, Triller has seen a $100 million injection in funding, with a $1.25 billion valuation. Triller’s leadership is now debating whether to proceed with private funding or push forward with a SPAC for a Triller IPO. Sources say that the deal is not certain, and negotiations are confidential.
SPACs are emerging as a popular way to go public with less regulatory scrutiny and more certainty. US SPACs have raised $53.8 billion in IPOs so far in 2020. According to data from SPAC Research, that’s more funding raised in a single year than in the prior seven years.
So is a Triller IPO a good idea? Triller says it has around 65 million monthly active users of its app.
But a report from The Verge disputes that number, citing analytics reports. Several celebrities have made Triller their home, including Alicia Keys, Cardi B, and Eminem. Kendrick Lamar and The Weeknd are also listed among the short-form video app’s early financial backers. Even if those numbers are accurate, that’s still far less than TikTok in the US.