With President Donald Trump back in office, his idea for a TikTok joint venture could set a precedent for how he expects all Chinese companies to operate in the US.
On Sunday evening, he posted on Truth Social: “I would like the United States to have a 50% ownership position in a joint venture. By doing this, we save TikTok, keep it in good hands and allow it to [stay] up.”
The next day, Trump signed an executive order that gave TikTok an additional 75 days to find a buyer before facing a ban.
While it’s unclear what the US owning 50% of TikTok means or how it might work, sources told NYNext that it is more likely Trump will push for a joint venture that would combine TikTok and an American company, sharing profit and risk. It could be a blueprint for how all companies with Chinese ownership operate in the States, sources add.
This JV may be much like the deal Trump put together, and later scrapped, in his first term between TikTok and a consortium of American companies. In 2020, Microsoft and Walmart explored a potential deal with the app that could have given them access to the TikTok audience and their data.
Many American companies that are granted the right to do business in China — including McDonald’s, General Motors and Boeing — function as joint ventures, though China has eased some of those rules in recent years. Tesla, for instance, is allowed to operate independently as a wholly foreign-owned enterprise.
“If an industry is required to be in a JV in China, [a Chinese company in that industry] needs to be a JV here,” the source said. “Trump loves the reciprocal trade framework … and he loves this [idea].”
So far, Trump’s reciprocal trade policy has largely focused on levying tariffs.
But sources told NYNext that advisers have floated the idea of President Trump issuing an executive order that would require at least some of the roughly 5,000 Chinese companies operating in the US — like Temu, Shein and Alibaba — to team up with an American partner.
It’s still unclear if a TikTok JV would completely satisfy the terms of the law, upheld by the Supreme Court, that demands a complete divestiture of the company from its Chinese parent company, ByteDance — or whether the company will actually agree to a JV or sale.
TikTok seems eager to cooperate for now.
“We thank President Trump for providing the necessary clarity and assurance to our service providers that they will face no penalties providing TikTok to over 170 million Americans and allowing over 7 million small businesses to thrive,” the company said in a statement Monday, as CEO Shou Zi Chew attended Trump’s inauguration. “It’s a strong stand for the First Amendment and against arbitrary censorship. We will work with President Trump on a long-term solution that keeps TikTok in the United States.”
A JV would also require some degree of cooperation with China, of course.
Asked about Chew’s willingness, Trump told the White House press corps: “I think he’d probably like it because he has nothing.”
But the Chinese government — which must approve a sale of TikTok — may be less excited and far more picky about who they work with.
Of the companies and people who have expressed interest — which now includes Frank McCourt and Kevin O’Leary, Mr. Beast, Bobby Kotick, Steve Mnuchin, Perplexity and Rumble — those who have actually worked with the Chinese government may be given more serious consideration.
“The Chinese government isn’t going to let very many people operate it,” a source close to TikTok said.
One person they may feel comfortable with is Elon Musk, whose name, according to the Wall Street Journal, has been floated by officials as a possible buyer.
While the Chinese government has denied reports they’d OK the sale of TikTok to Musk — and Musk has never said he’s interested — sources suggest officials desire a buyer they know and potentially have some influence with.
“China could have more leverage if Elon bought it given his Tesla factory in China,” the source added. “Elon is the best buyer … he has got a good relationship with the Chinese government and national security clearance for all his companies.”
Another reason why a Musk merger could make sense? He could cobble together some kind of deal between TikTok and X that could help boost both companies’ revenues and expand the platform. Earlier this week Musk suggested he is interested in bringing back Vine, the popular short-form video service that shut down in 2017. A TikTok deal would be one way to get more Vine-like videos on X.
“If it had the blessing of Trump and Elon could buy TikTok… people want a competitor to Zuckerberg,” another source added.
This story is part of NYNext, a new editorial series that highlights New York City innovation across industries, as well as the personalities leading the way.
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