Investor conviction in ByteDance’s potential has climbed since Washington and Beijing this week reached a framework settlement on the long-contested way forward for TikTok within the U.S., a number of dealmakers informed CNBC. Existing shareholders should not planning to promote within the wake of the TikTok deal, mentioned LU Shihui, associate at Envision Capital which has facilitated investments in ByteDance, including that the corporate’s valuation had already been rising for the previous few months. While sure offers have valued ByteDance at $300 billion to $350 billion, the most recent determine is $400 billion, considerably higher than round $230 billion seen earlier this yr, LU mentioned. This is a sign that buyers are holding on for extra beneficial properties and never panic-selling as they did in February, she mentioned in Mandarin, translated by CNBC. That was across the time when ByteDance first confronted stress from the U.S. to promote TikTok’s native operations , or shut down the app within the nation. The Chinese tech firm now faces a Dec. 16 deadline to divest the app — the fourth time it has been prolonged this yr by U.S. President Donald Trump. Investors have been holding on to their shares with few prepared to promote, in accordance with a personal share placement agent, who requested anonymity for privateness considerations. Interested patrons, from whom she obtained orders, have raised the valuation to round $330 billion, however “no one wants to let go of their investment in ByteDance now,” the individual mentioned. In its newest worker share buyback program in August, ByteDance valued itself at greater than $330 billion, Reuters reported , up barely from the $315 billion valuation in its prior inventory repurchase program in February. Valuations of unlisted corporations are likely to differ extensively as secondary share gross sales are negotiated privately, however ByteDance’s secondary share offers over the previous three months have persistently valued the corporate between $315 billion and $320 billion, the individual mentioned. After the most recent spherical of talks with the U.S. in Madrid earlier this week, China mentioned the 2 sides had reached a consensus on licensing the app’s algorithm and addressing points on managing U.S. person information. Exact particulars on how this might work have not been finalized or launched. But Beijing additionally warned that the U.S. shouldn’t count on China to “accommodate” its considerations whereas “suppressing” Chinese firms. Back in 2023, China mentioned it will ” strongly oppose ” a compelled sale of TikTok. Trump mentioned he expects to talk with China’s President Xi Jinping on Friday to finalize the deal particulars. The Chinese facet has but to verify whether or not the decision will occur. “If the sale is finalized, there will likely be even more interested buyers due to increased certainty,” mentioned Emily Zheng, senior VC analyst at PitchBook. ByteDance and TikTok didn’t reply to CNBC’s request for feedback. Conviction grows ByteDance is China’s most respected unicorn , in accordance with CBInsights. As the Beijing-based firm has but to go public, its valuation figures are largely estimates primarily based on buyers shopping for shares by way of non-public offers. “ByteDance’s valuation is high but not unfounded,” mentioned Zheng, citing the corporate’s first-quarter income that reportedly surpassed Facebook and Instagram proprietor Meta’s prime line, and its billions of {dollars} of funding in synthetic intelligence and sturdy efficiency of TikTok globally. “These have driven heightened investor interest and consequently its valuation [has risen], despite the geopolitical risks with ByteDance under Chinese ownership,” mentioned Zheng, including that the corporate could not have to faucet public markets within the close to future given its means to boost adequate non-public capital. In addition to working Douyin, the Chinese model of TikTok, ByteDance has additionally developed synthetic intelligence chatbot Doubao and text-to-video AI instruments . Publicly out there figures point out that even at a $400 billion valuation, ByteDance seems low cost. In 2024, ByteDance raked in $155 billion in annual income, a 52% soar from the earlier yr, in accordance with information from PitchBook. In comparability, Meta, which recorded a full-year income of $164.5 billion final yr, has a market worth of over $1.9 trillion. Wayne Shiong, co-founder and enterprise associate at China Growth Capital, mentioned that ByteDance continues to be “largely undervalued” in comparison in opposition to the U.S. tech giants corresponding to Meta, whose social media app Facebook has misplaced U.S. market share to TikTok. The U.S. market contributed about 23% to ByteDance’s complete income, Shiong estimates, noting {that a} potential divestment of TikTok within the U.S. may have restricted impression on the corporate’s enterprise. ByteDance has been creating a brand new model of TikTok for American customers that’s anticipated to function on a separate algorithm and information system from its international app, The Information reported in July , with the brand new app anticipated to be launched on U.S. app shops this month. The U.S.-China framework settlement for TikTok will embrace new and current buyers within the app’s mother or father ByteDance, sources informed CNBC’s David Faber. The deal is anticipated to shut within the subsequent 30 to 45 days, in accordance with the sources, who requested to not be named as a result of the small print of the negotiations are confidential. As a part of the settlement, Oracle will maintain its cloud deal with the platform, the folks mentioned. “The deal is not done yet so the expectation might be over priced-in,” cautioned Alex Ma, a veteran household workplace investor with publicity to ByteDance, including that there could be hurdles in execution. “We should not discount the risk of future changes in policies and geopolitical uncertainties as the chip is and will always be on the table,” Ma famous. That mentioned, ByteDance’s quarterly efficiency, significantly in markets outdoors the U.S., was so sturdy that “the valuation has a basis to go up,” he mentioned. Tech optimism builds Rising investor curiosity in ByteDance displays broader optimism in Chinese tech firms. The tech darling has garnered traction amongst buyers this yr amid a renewed rally in Chinese shares on the again of AI startup DeepSeek’s fast rise and Beijing’s pledge to assist the non-public sector. Zhang Yiming, ByteDance’s founder, was among the many entrepreneurs invited to a high-level symposium chaired by President Xi Jinping in February. KraneShares CSI China Internet ETF (KWEB) is up greater than 60% thus far this yr. In one other signal of renewed pursuits in Chinese equities, Morgan Stanley mentioned over 90% of the buyers surveyed have expressed “explicit willingness to increase their exposure to China,” the best degree since early 2021, with tech innovation in AI humanoid robotics among the many key areas. With Beijing taking a extra assertive stance, together with showcasing high-tech weapons at a army parade in early September, ByteDance buyers have grown extra assured within the nation’s tech capabilities, LU mentioned. Global buyers corresponding to BlackRock, General Atlantic and Susquehanna International Group, personal roughly 60% of ByteDance, with its founders proudly owning 20% and workers remaining 20%, in accordance with the corporate’s web site .