Ultimate Resource On TikToc. Who Gets Famous, Which Videos Go Viral And Which Trends Blow Up
TikTok Started With A Tech Guy From China Who Decoded America’s Teens. Ultimate Resource On TikToc. Who Gets Famous, Which Videos Go Viral And Which Trends Blow Up
TikTok has emerged as the defining app of a generation: a cultural tastemaker, a musical hitmaker and a launchpad for a new breed of celebrity. Its hold on American culture can be traced back to Alex Zhu, a technology entrepreneur from China.
Zhu grew up in Anhui province and studied civil engineering at Zhejiang University. He came to the San Francisco Bay Area to work at the software company SAP SE. On a Silicon Valley train ride in 2014, Zhu became fascinated by a group of American teenagers seated nearby, listening to music and shooting video on their phones. He decided to create an app that joined the two cultural obsessions.
The result was Musical.ly, which encouraged users to record themselves lip-syncing to pop songs. Zhu later sold Musical.ly to a fast-rising Beijing startup called ByteDance Ltd., which folded the app into TikTok.
The TikTok Story looks at the genesis of Gen Z’s favorite app. It tells the story of a 36-year-old Chinese tech founder who seemed to have an uncanny understanding of American teenagers—a skill that helped him build a social media powerhouse that even competitors, including Facebook Inc., wanted to buy.
“He just has this incredible perspective of building this company from China that American teenagers are using more than anything right now,” said Josh Elman, a former Musical.ly investor who now works at Apple Inc.
Behind TikTok Is a Chinese Tech Giant Fueling the World’s Hottest App
TikTok goes inside the Beijing parent company.
TikTok is powered by sophisticated artificial intelligence that predicts what people want to see next. The app goes beyond even the systems used by Facebook Inc. or Snapchat. TikTok studies usage closely and considers hundreds of data points including what websites you’re browsing and how you type, down to keystroke rhythms and patterns.
The algorithms were developed at ByteDance Ltd., TikTok’s Chinese parent company and the most valuable startup in the world. We look at how ByteDance founder and Chief Executive Officer Zhang Yiming fundamentally changed how a generation consumes media on their phones.
Zhang started his company in a small Beijing apartment and used American venture capital money to buy up startups and music rights in the U.S. In his first-ever interview with Western media, he revealed his unique management style. “Unlimited salary for unlimited talent,” Zhang told Bloomberg in 2017.
TikTok Redefined The Economics Of Fame
TikTok chooses who gets famous, which videos go viral and which trends blow up.
From a young age, Flo Milli dreamed of music stardom. However, the 21-year-old rapper from Mobile, Alabama, could not have predicted that an app from China would be instrumental to her success.
Before she was famous, Flo Milli, whose real name is Tamia Monique Carter, wrote music and posted each new recording online. One day, a song called Beef FloMix started trending on TikTok. Flo Milli said she didn’t have an active TikTok account at the time.
TikTok executives noticed Flo Milli’s music and helped her join the platform. Flo Milli said that within weeks, she gained attention within the music industry. She has since signed with RCA Records and was nominated for Best New Artist at the 2020 BET Hip Hop Awards.
“I didn’t choose this path, but I will embrace it, you know, the fact that my music made it on TikTok,” Carter said on Foundering: The TikTok Story. “I’m just using it to my advantage.”
We explain how TikTok has redefined American pop culture and upended the music industry, advertising and the economics of fame. The company’s hands-on approach with its creators and artists helped mint a new generation of social media stars and positioned TikTok’s parent company, ByteDance Ltd., as the first Chinese tech giant to come out with a truly global consumer app.
Kids On TikTok Find The Sunny App Has A Dark Side
TikTok is known primarily as a launchpad for funny memes, dance routines and lip-synching videos. The company embraces that reputation with a tagline, “the last sunny corner on the internet.” But there’s a dark side to TikTok that engulfs some of the app’s youngest users.
Beneath the surface, TikTok also hosts videos promoting anorexia, bullying, suicide and sexual exploitation of minors. Highly personalized recommendations, driven by algorithms owned by the parent company ByteDance Ltd., often make it harder for parents to track what their children are seeing and for regulators to monitor what kids are being exposed to on the app.
“Parents think that TikTok has some redeeming values,” David Gomez, a school resource officer in Idaho, said. The TikTok Story. “Videos, lip syncing, singing, dancing around. OK. I see that stuff. But parents are just not understanding how many predators are on TikTok.”
A spokesperson for TikTok said the company is “deeply committed” to the safety of minors and that it continues to strengthen safeguards. In January, TikTok stopped allowing strangers to comment on videos posted by users under 16 years old. And it restricted the ability to download their videos and changed the default settings on kids’ accounts from public to private.
But the problems began years before TikTok even existed. Kids flocked to Musical.ly, the precursor to TikTok. Back then, one advertising executive called it “the world’s youngest social network” because its audience included elementary school students.
Safety advocates said TikTok for years prized expansion over the protection of minors. “Their company exploded in growth across the world, and they just didn’t prioritize child safety as they were growing,” said Dawn Hawkins, who runs an advocacy group called the National Center on Sexual Exploitation.
Hawkins said she spent months helping an 8-year-old relative get inappropriate videos of him in his underwear taken down from TikTok. Hawkins acknowledged that TikTok recently made a number of sought-after improvements but said it’s still not a safe place for very young children to roam unmonitored.
U.S. Government Contractor Embedded Software In Apps To Track Phones. Trump Bans TicToc For Violating Your Privacy Rights While Giving US-Based Firm Go Ahead
Anomaly Six has ties to military, intelligence agencies and draws location data from more than 500 apps with hundreds of millions of users.
A small U.S. company with ties to the U.S. defense and intelligence communities has embedded its software in numerous mobile apps, allowing it to track the movements of hundreds of millions of mobile phones world-wide, according to interviews and documents reviewed by The Wall Street Journal.
Anomaly Six LLC a Virginia-based company founded by two U.S. military veterans with a background in intelligence, said in marketing material it is able to draw location data from more than 500 mobile applications, in part through its own software development kit, or SDK, that is embedded directly in some of the apps.
An SDK allows the company to obtain the phone’s location if consumers have allowed the app containing the software to access the phone’s GPS coordinates.
App publishers often allow third-party companies, for a fee, to insert SDKs into their apps. The SDK maker then sells the consumer data harvested from the app, and the app publisher gets a chunk of revenue.
But consumers have no way to know whether SDKs are embedded in apps; most privacy policies don’t disclose that information. Anomaly Six says it embeds its own SDK in some apps, and in other cases gets location data from other partners.
Anomaly Six is a federal contractor that provides global-location-data products to branches of the U.S. government and private-sector clients. The company told The Wall Street Journal it restricts the sale of U.S. mobile phone movement data only to nongovernmental, private-sector clients.
Numerous agencies of the U.S. government have concluded that mobile data acquired by federal agencies from advertising is lawful. Several law-enforcement agencies are using such data for criminal-law enforcement, the Journal has reported, while numerous U.S. military and intelligence agencies also acquire this kind of data.
Many private-sector companies in the advertising and marketing world buy and sell geolocation data, sometimes reselling it to government agencies or contractors. But the direct collection of such data by a business closely linked to U.S. national security agencies is unusual.
Anomaly Six was founded by defense-contracting veterans who worked closely with government agencies for most of their careers and built a company to cater in part to national-security agencies, according to court records and interviews.
The firm’s capabilities were described in documents prepared for military officials that were reviewed by the Journal. The company also explained its business practices in a recent briefing to the office of Sen. Ron Wyden, whose staff then described it to the Journal. The Oregon Democrat has been conducting a probe into the sale of Americans’ location data.
“Anomaly Six is a veteran-owned small business that processes and visualizes location data sourced from mobile devices for analytics and insights,” the company said in response to questions for this article.
“We leverage detailed location data from numerous first-party sources to provide insights into groups, behaviors, and patterns.” The company said it acknowledged the “intense scrutiny” around the government use of such data, but said all the data it works with is commercially available and compliant with all laws.
Anomaly Six said it would support regulation to require more disclosure by apps of how data is collected and used. The exact apps the company partners with couldn’t be determined and the company declined to comment, citing confidentiality agreements. The partnerships between data brokers and app makers are typically closely held trade secrets within the world of commercial-data sales.
Asif Khan, a marketing expert and founder of the Location Based Marketing Association, a trade group representing advertising and marketing companies who deal in location data, said the government acquisition of consumer location data has been a longstanding issue for the industry. He said app-makers should be more transparent with consumers about how the data may be used once it is collected.
“You could argue that the government has the right, just like any commercial entity, to buy the data, if the data is available from a commercial supplier,” said Mr. Khan. “But you also need to be able to clearly say ‘this data could be used by government.’”
“I think the average consumer doesn’t have a clue,’ he said.
In the data drawn from apps, each cellphone is typically represented by an alphanumeric identifier that isn’t linked to the name of the cellphone’s owner.
But the movement patterns of a phone over time can allow analysts to deduce its ownership—for example, where the phone is located during the evenings and overnight is likely where the phone-owner lives.
The company says it doesn’t meet the definition of a data broker under California law and isn’t required to register. The California attorney general’s office didn’t respond to a request for comment.
According to interviews with numerous people in the industry, there is little regulation in the U.S. about the buying and selling of location data, leading to what one industry veteran called “the Wild West.” Consumers have come to expect free apps, and app makers have turned to selling user data to pay for the costs of developing and running the software, people familiar with the industry.
Anomaly Six’s offerings are similar to those of a company called Babel Street, which provides social-media monitoring services to the intelligence community and law-enforcement agencies. A lawsuit filed by Babel Street two years ago against Anomaly Six and its founders offers a window into the competitive and largely secretive market of providing consumer location products to the U.S. government.
The two founders of Anomaly Six formerly worked for Babel Street and left in 2018, according to the lawsuit.
Brandan Huff, a former Army counterintelligence officer, had managed Babel Street’s relationship with the Defense Department and had also worked for numerous other defense contractors. The other, Jeffrey Heinz, was also previously in the U.S. Army and had managed Babel Street’s relationships with the Justice Department, U.S. Cyber Command, civilian federal agencies and the intelligence community, court records show.
One of Babel Street’s products, called “Locate X,” includes the location records of millions of cellphones, drawn from consumer apps. The two former employees set out to build a product to compete with it, according to Babel’s lawsuit. Anomaly Six declined to comment on the lawsuit, which was settled out of court last year.
Babel Street doesn’t publicly advertise Locate X and binds clients and users to secrecy about even its existence, according to contracts and user agreements reviewed by the Journal. Developed with input from U.S. government officials, according to court records, Locate X is widely used by military intelligence units who work on gathering “open source” intelligence, or information taken from publicly available sources.
Babel Street also has contracts with the Department of Homeland Security, the Justice Department, and many other civilian agencies, federal contracting data shows. Babel Street didn’t respond to a request for comment.
Both Babel Street’s and Anomaly Six’s products can be used to combine intelligence gathered in more traditional ways, from clandestine human sources to secret intercepts, with social media data, satellite imagery, and consumer data from the private sector, according to interviews with people familiar with the process and documents reviewed by the Journal.
The information, gathered into what’s known as a “pattern of life” analysis, can provide a richer understanding of the habits and behaviors of potential intelligence targets, and to possibly predict their future behavior.
The U.S. isn’t alone in attempting to use mobile-location data for strategic advantage. The National Security Agency this month warned military and intelligence community personnel to sharply limit the location-tracking features on their mobile devices, out of concern that the data could be used by adversaries to reveal sensitive national security information about U.S. operations.
A group of academic researchers using Babel Street’s software were able to monitor the movement of devices at Russian military facilities as part of a project for the U.S. Army, the Journal also reported last month.
Such revelations showcase the power of even commercial data to reveal sensitive information about some of the most secure facilities in the world—and raise privacy concerns about the blurring the lines between corporate marketing and government surveillance.
“It’s really alarming to learn about companies like this that claim to have years’ worth of location data from all over the world. Revelations like this just keep coming,” said Laura Moy, a law professor at Georgetown University and director of the school’s Communications & Technology Law Clinic.
“Users have no idea that when they install a weather app, a game, or any other innocuous-seeming app that their private location data is going to be harvested and sold. Apparently that’s what’s happening here, and we have no transparency into the practice,” said Ms. Moy.
Anomaly Six isn’t listed in any public spending contracts, and many of Babel Street’s sales to government entities aren’t reflected in public documents either. Anomaly Six said its contracts with the U.S. government were unclassified but confidential, and that it couldn’t reveal which agencies it was working with without permission from those agencies.
TikTok Tracked User Data Using Tactic Banned by Google
The tactic, which experts in mobile-phone security said was concealed through an unusual added layer of encryption, appears to have violated Google policies.
TikTok skirted a privacy safeguard in Google’s Android operating system to collect unique identifiers from millions of mobile devices, data that allows the app to track users online without allowing them to opt out, a Wall Street Journal analysis has found.
The tactic, which experts in mobile-phone security said was concealed through an unusual added layer of encryption, appears to have violated Google policies limiting how apps track people and wasn’t disclosed to TikTok users. TikTok ended the practice in November, the Journal’s testing showed.
The findings come at a time when TikTok’s Beijing-based parent company, ByteDance Ltd., is under pressure from the White House over concerns that data collected by the app could be used to help the Chinese government track U.S. government employees or contractors. TikTok has said it doesn’t share data with the Chinese government and wouldn’t do so if asked.
The identifiers collected by TikTok, called MAC addresses, are most commonly used for advertising purposes. The White House has said it is worried that users’ data could be obtained by the Chinese government and used to build detailed dossiers on individuals for blackmail or espionage.
TikTok, which said earlier this year that its app collects less personal data than U.S. companies such as Facebook Inc. and Alphabet Inc.’s GOOG 1.78% Google, didn’t respond to detailed questions.
In a statement, a spokesperson said the company is “committed to protecting the privacy and safety of the TikTok community. Like our peers, we constantly update our app to keep up with evolving security challenges.”
The company said “the current version of TikTok does not collect MAC addresses.”
Most major mobile apps collect a range of data on users, practices that privacy advocates have long found alarming but that tech companies defend as providing highly customized experiences and targeted advertising. Data collection varies by company.
About 1% of Android apps collect MAC addresses, according to a 2018 study by AppCensus, a mobile-app analysis firm that consults with companies on their privacy practices.
A Google spokesperson said the company was investigating the Journal’s findings and declined to comment on the loophole allowing some apps to collect MAC addresses.
The Trump administration’s national-security concerns prompted ByteDance to explore a sale of TikTok’s U.S. operations with several suitors, including Microsoft Corp. When asked if the company was aware of this data-collection issue, a Microsoft spokesman declined to comment.
The issue involves a 12-digit “media access control,” or MAC, address, which is a unique number found in all internet-ready electronics, including mobile devices.
The MAC address is useful to advertising-driven apps because it can’t be reset or altered, allowing app makers and third-party analytics firms to build profiles of consumer behavior that persist through any privacy measure short of the owner getting a new phone. The Federal Trade Commission has said MAC addresses are considered personally identifiable information under the Children’s Online Privacy Protection Act.
“It’s a way of enabling long-term tracking of users without any ability to opt-out,” said Joel Reardon, an assistant professor at the University of Calgary and co-founder of AppCensus, Inc. “I don’t see another reason to collect it.”
Apple Inc. locked down iPhone MAC addresses in 2013, preventing third-party apps from reading the identifier. Google did the same two years later in Android. TikTok bypassed that restriction on Android by using a workaround that allows apps to get MAC addresses through a more circuitous route, the Journal’s testing showed.
The security hole is widely known, if seldom used, Mr. Reardon said. He filed a formal bug report about the issue with Google last June after discovering the latest version of Android still didn’t close the loophole. “I was shocked that it was still exploitable,” he said.
Mr. Reardon’s report was about the loophole in general, not specific to TikTok. He said that when he filed his bug report, the company told him it already had a similar report on file. Google declined to comment.
TikTok collected MAC addresses for at least 15 months, ending with an update released Nov. 18 of last year, as ByteDance was falling under intense scrutiny in Washington, the Journal’s testing showed.
TikTok bundled the MAC address with other device data and sent it to ByteDance when the app was first installed and opened on a new device. That bundle also included the device’s advertising ID, a 32-digit number intended to allow advertisers to track consumer behavior while giving the user some measure of anonymity and control over their information.
Privacy-conscious users can reset the advertising ID from the settings menu of the device, an action roughly equivalent to clearing cookies in a browser.
Google’s Play Store policies warn developers that the “advertising identifier must not be connected to personally-identifiable information or associated with any persistent device identifier,” including the MAC address, “without explicit consent of the user.”
Storing the unchangeable MAC address would allow ByteDance to connect the old advertising ID to the new one—a tactic known as “ID bridging”—that is prohibited on Google’s Play Store. “If you uninstall TikTok, reset the ad ID, reinstall TikTok and create a new account, that MAC address will be the same,” said Mr. Reardon. “Your ability to start with a clean slate is lost.”
Despite the prohibition, ID bridging is fairly widespread, according to AppCensus, particularly among free gaming apps. But it seldom involves the MAC address, the most persistent identifier accessible in the current version of Android.
In a random study by AppCensus of 25,152 popular internet-enabled Android apps in 2018, only 347, or 1.4%, were seen using the Android loophole to send the MAC address. Of those, only 90 were also transmitting the built-in Android ID, which changes if the device is reset.
The Journal’s analysis confirmed some of the behavior detailed in a widely-discussed anonymous Reddit post in April charging that TikTok transmitted a range of personal data to ByteDance servers, including the MAC address. Google said it’s investigating the claims in that post.
The Journal examined nine versions of TikTok released on the Play Store between April 2018 and January 2020. The Journal’s analysis was limited to examining what TikTok collects when freshly installed on a user’s device, before the user creates an account and accepts the app’s terms of service.
Less typical are the measures ByteDance takes to conceal the data it captures. TikTok wraps most of the user data it transmits in an extra layer of custom encryption.
As with virtually all modern apps, TikTok’s Internet traffic is protected by the web’s standard encryption protocols, making it unlikely that an eavesdropper can steal information in transit.
That makes the additional, custom encryption code TikTok applies to user data seemingly extraneous—unless it was added to prevent the device owner from seeing what TikTok was up to, said Nathan Good, a researcher at the International Digital Accountability Council, a watchdog group that analyzes app behavior.
“It doesn’t provide any extra level of Internet security,” agreed Mr. Reardon. “But it does mean that we have no transparency into what’s being sent out.”
It is common for mobile apps to hide parts of their software to prevent them from being copied by competitors, but TikTok’s encryption doesn’t appear to be hiding a proprietary secret, said Marc Rogers, vice president of cybersecurity strategy at Okta, Inc., which provides services that help users securely log in online.
“My guess is that the reason they do that is to bypass detection by Apple or Google because if Apple or Google saw them passing those identifiers back they would almost certainly reject the app,” Mr. Rogers said.
Google should remove TikTok from its platform, said Sen. Josh Hawley (R., Mo.), in a statement to the Journal, when apprised of the findings. Sen. Hawley has been critical of TikTok and a hawk toward China generally.
“Google needs to mind its store, and TikTok shouldn’t be on it,” he said. “If Google is telling users they won’t be tracked without their consent and knowingly allows apps like TikTok to break its rules by collecting persistent identifiers, potentially in violation of our children’s privacy laws, they’ve got some explaining to do.”
Secretive High-Speed Trading Firm Hits Jackpot With TikTok
Susquehanna International Group is sitting on stake in app’s owner estimated at more than $15 billion.
No matter the outcome of the struggle between China and the U.S. over video-sharing app TikTok, an unlikely winner will be a secretive trading firm based outside of Philadelphia.
Susquehanna International Group LLP, an options-trading giant, has largely avoided publicity during its three-decade history.
Susquehanna’s core business is using quantitative models and computers to execute rapid-fire trades in various markets. Such firms tend to rake in profits by making thousands of small trades a day, often holding securities for fractions of a second.
But in the case of TikTok, the firm bet big and held on to its investment for years.
Susquehanna owns around 15% of TikTok owner ByteDance Ltd., according to people familiar with the matter. This makes Susquehanna the largest outside investor in the Beijing-based social-media company. Based on private trades of ByteDance shares earlier this year, Susquehanna is sitting on a stake that could be worth more than $15 billion on paper, according to data firm PitchBook.
The firm’s founding partners are poised to personally profit from the investment more than traditional venture capitalists would, because the firm invests only the partners’ money, according to Susquehanna’s China website. Typically, venture-capital firms raise funds from outside investors and must share profits with them. Susquehanna declined requests to interview its founders.
Susquehanna got into ByteDance early, joining a $5 million investing round in 2012, the year the Chinese company was founded, according to PitchBook. The company’s TikTok app now has hundreds of millions of users globally, about 100 million of whom are in the U.S., many of them teenagers. Susquehanna also invested in Musical.ly, a video app that was bought by Bytedance in 2017 and later folded into TikTok.
The future of the investment is still undecided, with Susquehanna caught in a geopolitical standoff between Washington and Beijing. ByteDance is currently seeking approval from both governments for a deal that would include Oracle Corp. and Walmart Inc. taking a stake in a newly created U.S.-based company and running some of its operations. Regardless of how it plays out, Susquehanna is likely standing on a significant return.
People close to ByteDance say the driving force behind the investment was a pair of local executives at Susquehanna’s China venture-capital unit, SIG Asia Investments: Tim Gong, who has led the unit, and Joan Wang, who was a big early supporter of ByteDance founder Zhang Yiming.
Susquehanna invested in two startups that Mr. Zhang was involved with before founding ByteDance—travel site KuXun and real-estate portal 99Fang—and the firm invested in ByteDance even after the failure of 99Fang. Ms. Wang met Mr. Zhang frequently to advise him on strategy as he cycled through ideas for a business model in ByteDance’s early days.
During the Chinese New Year holidays in 2012, Mr. Zhang met Ms. Wang at a cafe in Beijing and the two discussed artificial intelligence. The meeting planted the seeds for an AI-powered news-aggregation service called Toutiao, which would become Bytedance’s first big hit before TikTok.
At first skeptics doubted Toutiao’s ability to compete with larger rivals Sina Corp. and Sohu Inc. Ms. Wang, an early ByteDance board member, connected potential investors to Mr. Zhang, says Hong Chen, chief executive of Hina Group, a Chinese investment bank and investing firm.
“She was a great helper for ByteDance,” said Mr. Chen, who is friends with Ms. Wang. “She is a very hands-on investor.”
The bridge between ByteDance, Ms. Wang and Susquehanna’s headquarters in Bala Cynwyd, Pa., is Arthur Dantchik, who co-founded the firm with a group of college friends in 1987.
Mr. Dantchik is on the ByteDance board, having taken over the seat initially occupied by Ms. Wang. He would also be a board member of TikTok Global, the proposed U.S.-based spinout that the company is working to create to avoid the app being banned from the U.S. by the Trump administration.
People close to Susquehanna say Mr. Dantchik is an affable, well-liked figure within the firm who was more globally oriented than some of the other founding partners. He helped start SIG Asia Investments in 2004. He has traveled regularly to China and other places where Susquehanna has investments, such as Israel, these people said.
The firm’s roots date back to the State University of New York at Binghamton, where six of its co-founders were students in the 1970s. Most of them shared a love of poker. They initially set up shop in the building of the Philadelphia Stock Exchange. Israel Englander, the billionaire chief executive of hedge-fund firm Millennium Management, helped the crew get its start by sponsoring Susquehanna co-founder Jeffrey Yass for a seat at the exchange. Mr. Yass’s father Gerald also helped set up the firm.
Poker remains a big part of Susquehanna’s culture. The game is part of the training curriculum for new employees, and the firm holds an annual employee poker tournament, detailed in a blog on Susquehanna’s website. Another co-founder, Eric Brooks, won first place in a seven-card stud event at the 2008 World Series of Poker. He gave his winnings of $415,856 to an educational charity.
Susquehanna now has more than 1,900 employees in offices world-wide. The firm accounts for more than one-fifth of U.S. options-trading volume, and it was sitting on more than $80 billion worth of stocks, options and other securities and derivatives at the end of 2019, according to an analysis of the firm’s regulatory filings by Alphacution, a research firm specializing in proprietary trading firms. Options are contracts that give investors the right to buy or sell a stock at a particular price.
Secrecy is another hallmark of Susquehanna, which doesn’t publicly disclose its financial metrics. The firm, like many high-speed trading firms, requires employees to sign noncompete agreements to keep trading secrets from being shared with rivals.
“Susquehanna is like a black hole,“ said Paul Rowady, director of research at Alphacution. “There’s no light that escapes.”
As ByteDance negotiates the fate of TikTok with U.S. and Chinese authorities, Mr. Dantchik hasn’t played a big role in talks with officials, allowing other ByteDance investors such as Sequoia Capital and General Atlantic to take the lead, people familiar with the discussions said.
More than 30 years after its formation, Susquehanna is still closely held by its remaining co-founders, and it has never brought in outside investors, the people close to the firm said.
That explains in part how it ended up in China. The trading business generated such hefty profits that it spurred the Susquehanna co-founders to look for other places to reinvest their money, these people said.
The firm branched out into traditional investing in the 1990s, initially focusing on private investments in public equity, or PIPEs, a type of deal in which private investors buy equity stakes directly from a publicly traded company.
Later, Susquehanna set up units for venture capital and private-equity investments. As the Internet boom spread to China and more Chinese startups were listed in the U.S. in the 2000s, it launched SIG Asia Investments in Shanghai.
In its early days in China, Susquehanna appeared alongside Sequoia in several investments, such as Bona Film Group, producer of the 2019 World War II epic “Midway,” and fast-food chain Country Style Cooking Restaurant Chain Co. Overall in China, Susquehanna has invested in more than 260 companies since 2005 in such sectors as media, internet, consumer and health-care, totaling more than $2 billion, according to its website. It co-invested with Sequoia 36 times, according to Chinese venture capital research firm Zero2IPO.
In the coterie of entertainment financiers in China, Mr. Gong is known for co-hosting an exclusive party with Bona Film during the Shanghai Film Festival each year at a bungalow near the city’s famed waterfront promenade The Bund, according to people familiar with the matter.
Attendees are often the power brokers in China’s film industry, such as producers and directors. Mr. Gong, a proud wine aficionado, handpicks the wines served at the parties.
Why John Mayer Teased His New Single, ‘Last Train Home,’ On TikTok
The musician spent the pandemic experimenting online and looking for comfort. So when he wrote his new song and coming album, ‘Sob Rock,’ he asked himself, ‘What music makes me feel like everything’s going to be OK?’
One day in late March, John Mayer went online and posted a preview of some new music. The eight-bar fragment, which spotlighted a buoyant electric-guitar-and-keyboard figure laid over a clean and unfussy backbeat, was suitably Mayer-esque. The forum in which he chose to reveal it—TikTok—was not.
How did he wind up there? “I don’t ever want to be the type of artist or person who goes, ‘no, no, no,’ ” Mr. Mayer says simply.
But there was another consideration: “Once you get past the age of 40, anything can be Elvis. And you have to be very careful that you’re not the guy shaking his head at Elvis.”
Mr. Mayer is 43, placing him well outside the target age range of the quick-cut, dance-challenge-heavy, youth-dominated social media juggernaut. But, he says, the head of his record label urged him to join the platform, and so he made quick work of its potential as a vehicle for both interactive engagement and passive absurdist humor.
He invited users to join him in virtual jam sessions and instructed them on how to play his songs. And he posted clips that showed him peeling a Sumo orange and ruminating deeply on “even numbers that seem odd to me” (for those wondering, 13,712 is among these).
Over two months, he’s accumulated more than a million followers. The new music that he teased on TikTok back in March will now be out as a single, “Last Train Home,” on June 4. It will be followed, on July 16, by the companion album, “Sob Rock,” his first in four years and eighth overall.
Mr. Mayer has long exhibited a talent for navigating assorted musical genres, age demographics and media pursuits. He has worked onstage as a stand-up comedian and on network TV as a late-night talk-show host. He stars in his own low-budget Instagram Live interview series, “Current Mood.”
And he was a relatively early adopter of the exclusive audio-only app Clubhouse, where he has dropped in unannounced to hold court on a variety of topics for thousands of listeners. Mr. Mayer is getting ready to tour U.S. stadiums and sheds this summer and fall, with the Grateful Dead offshoot Dead & Company.
If not for the Covid-19 lockdown, Mr. Mayer says, he may not have made a record at all. “At the very least, not this one.” This past pandemic year has been, on a grand scale, a “frightening, unbelievably tragic thing,” he says. Where it led him musically was to a place of reassurance. “Sob Rock” is a record “made to bring comfort.”
There’s a distinct 1980s soft-rock vibe lurking within its melodies and grooves. “I asked myself, ‘What music makes me feel like everything’s going to be OK?’ ” Mr. Mayer says. “And it’s the music I listened to growing up in the ‘80s. There’s a security-blanket aspect about that sound that reminds me of a safer time.”
“Last Train Home,” like many songs on “Sob Rock,” juxtaposes lush chording and breezy cadences with serious subject matter, in this case, a relationship in distress (“If you wanna use me, then you gotta use me ’til I’m gone,” Mr. Mayer sings in the first verse).
“The songwriting on the record is decidedly modern—there’s no throwback sensibility,” says Don Was, a producer who has worked with Bonnie Raitt, the Rolling Stones and Bob Dylan, and who has helmed two Mayer albums in addition to “Sob Rock.” “As a musician and a songwriter, he’s as good as anybody at finding something that’s going on in his emotional inner life and expressing it eloquently.”
Aside from a solo career that’s led to multiple Platinum-certified albums and singles, seven Grammys and his own PRS signature guitar model, Mr. Mayer is a first-call collaborator when newer artists ranging from Leon Bridges to Khalid to Maren Morris (to name just three recent examples) are looking to add a certain something—usually a subtly bluesy and highly melodic guitar accompaniment—to a track. With Dead & Company, he’s a pivotal member, but also the youngest participant by some years.
“John is a musician’s musician,” says original Grateful Dead guitarist and vocalist Bob Weir, who is also Mr. Mayer’s band mate in Dead & Company. “That’s where his sensibilities lead him and that’s what you get from him.”
Even as Mr. Mayer speaks of finding “joyous” shelter in the music of his childhood on “Sob Rock,” his conversation is preoccupied with notions of maturing and, as he puts it repeatedly, “aging gracefully.”
He has made a clean break from the serial-dating, controversial-interview-giving tabloid version of himself that provided fodder for the media machine in the early 2010s, remarking, “I do think that at a certain point you are allowed to take all your loose ends, put them in a box and lock them up and say, ‘We never have to talk about that again.’ ”
And going forward? “I’m not a make-the-same-mistake-twice kind of guy.”
Mr. Mayer has also taken a breather from TikTok (for now), conceding that pulling back “is a new feeling for me as a former ‘gotta be there’ guy.”
“As I get older, there is this slowing down of the need to sort of run every play in the book,” he says.
This would seem at odds with his decidedly full plate: his own new solo album, a Dead & Company tour (“it’s a lot of work to memorize 120 Grateful Dead songs,” he points out, “but it’s this place where I can turn around, look at my own music and say, ‘I’m going to leave you here for a second and go do this’ ”), and, as he puts it, “all these other projects that are coming down the pike.”
Busy schedule to the contrary, he says, “it’s quieter in my head than you might think. I don’t apply too much context to things other than, if it feels good and it feels honest and I won’t regret it—and I’m pretty good at sensing those things now—then I’ll do it.”
No, Really, TikToks And Tweets Could Make You A Smarter Investor
How Lily Francus, Kyla Scanlon, and other breakout stars of financial social media are cutting through the noise.
When you think of the places where Internet culture mashes up with finance, you might imagine Reddit boards where bro-ish posters who call themselves “apes” gang up to push shares of AMC Entertainment Holdings Inc. to the moon. Or YouTube personalities pumping crypto coins and get-rich-quick schemes. But there’s also a loose circle of posters on Twitter—affectionately known to its denizens as FinTwit—trading real ideas, along with plenty of jokes and esoteric memes, plus links to their Substack newsletters and TikTok skits.
FinTwit isn’t new, but it’s become required reading for anyone who wants to understand a market that’s increasingly influenced by what’s happening on social media. (That’s one reason many journalists, including this writer, spend perhaps a little too much time there.) Many of the posters work in finance, and it’s turning out to be a place where younger voices and women can build huge followings and further their careers.
Lily Francus, a former Ph.D. student turned quantitative researcher at Moody’s Analytics, joined Twitter in January to post intraday market predictions generated by her NOPE model. That stands for the Net Options Price Effect, and it tracks movements related to something called delta hedging. If that’s a head scratcher to you, don’t worry—FinTwit can be a nerdy place.
But Francus’s model was hugely topical, thanks to what was happening over on Reddit. The WallStreetBets crowd was piling into options on stocks such as GameStop Inc., which spurred a bullish feedback loop of sorts. NOPE helped explain what was going on. “More people started taking what I was saying seriously,” Francus says. “ ’Cause you know, when a 25-year-old is like, ‘Yeah, I developed an intraday trading model on the most competitive market in the world,’ most people were like, ‘Yeah, that’s adorable.’ ”
After GameStop, Francus was written up in the Financial Times and interviewed on Bloomberg Television and for the finance podcast Infinite Loops. Francus had earlier been active on Reddit and Discord, but moving to the bird app brought a whole new audience. “It was really encouraging in both good and bad ways,” she says of her Twitter experience. “You’re perpetually surrounded by this environment where not only do people have a lot more experience than you, but if you post something, you pretty much get immediate feedback if you were right or wrong.”
As Francus’s following exploded, she used the platform to promote her research blog. The finance world began to notice. She joined Moody’s Analytics in July. “Pre-Twitter, I would never, ever have interacted with or come across Lily,” says Infinite Loops co-host Jim O’Shaughnessy, a veteran money manager. “What I love about Twitter is that yes, there’s a lot of noise—and I think you have to be very aggressive in the way you curate—but there’s a lot of signal. And I see that signal emerging more and more.”
O’Shaughnessy, a self-described “old” at 61, recently hired Bengaluru-based Vatsal Kaushik to work on the podcast, after following him on Twitter nine months earlier. O’Shaughnessy Asset Management associate Jamie Catherwood, who joined the firm in March 2019, was also found on the site. “One of the things I think is brilliant about Twitter is that it’s becoming a real-time résumé, a proof-of-work résumé,” O’Shaughnessy says.
That was the experience of Caitlin Cook, 23, who joined Onramp Invest, a crypto-asset platform for financial advisers, after crossing paths with Chief Executive Officer Tyrone Ross on Twitter. While exchanging messages, Cook asked to be kept in mind if Onramp was hiring. It was, and Cook landed a job as the firm’s head of community. She’s now vice president of operations for its Onramp Academy. “I’ve learned more on Twitter than most anywhere else probably, more than college,” Cook says. “But the networking part is the biggest for me.”
“The Best Accounts Are Under 2,000”
FinTwit, like Reddit, has its share of self-described “s—posting” and “loss porn”—people bragging about how much money they’ve burned on foolhardy trades. Women and people of color often face harassment on Twitter, and FinTwit’s no exception. But the platform has some advantages.
“It’s so much easier to find what you’re looking for, through hashtags, groups, lists,” says Callie Cox, senior investment strategist at Ally Invest.
“Twitter is also easier to curate what you’re looking for, because many accounts aren’t anonymous, and it incentivizes you to not be anonymous—you can get verified.”
That the majority of FinTwit users post under their real names helps create an atmosphere that’s less foul than other parts of the internet. For the most part. “I think in general, there’s reduced toxic-ness from accounts that are non-anonymous, because you do have career risk, especially in finance, so people tend to play nicer,” Francus says.
But one of the most amusing and mysterious parts of FinTwit is the quality of its anonymous accounts. In addition to wildly popular meme accounts such as “Ramp Capital” and “Dr. Parik Patel, BA, CFA, ACCA Esq.”—which each command more than a quarter-million followers—is a population of pseudonymous accounts run by investing pros. They may be silenced by their company’s social media policies or worried about damaging their careers with a careless or perhaps too honest tweet.
“You really have a ton of alpha on the platform,” says Kyla Scanlon, a 24-year-old from Los Angeles with a growing FinTwit profile. (“Alpha” is Wall Street jargon for the ability to beat the market.) “If you can pin it together, connect the dots on it, you’re like, ‘Oh my God, I can’t believe this little account is this big, big name in the space.’ If you look at the quality of their tweets, usually it’s just super top-notch. The best accounts are under 2,000 followers, probably.”
Scanlon, like Francus, experienced firsthand the flywheel effect Twitter can have on someone’s influence. A trader and finance blogger since college, she began posting short clips on TikTok explaining things like lumber shortages and decentralized finance. In late March she posted a 57-second video about the Archegos Capital blowup to Twitter, where it received more than 5,000 likes. She followed that up a week later with a video about a New Jersey deli with a $100 million market value, and she’s seen her number of followers balloon since.
In a recent video, Scanlon performs, with the skill of an improv star, a conversation among Federal Reserve Chair Jerome Powell, fund manager and Bitcoin evangelist Cathie Wood, Tesla Inc.’s Elon Musk, and Twitter CEO Jack Dorsey. “Bitcoin is hedge against all the -flations,” says her version of Wood. “Inflation, deflation, stagflation.” (To anyone who follows Wood, that’s a pretty dead-on joke.) To play Dorsey, she ties her hair in front of her chin to mimic his wild beard.
It’s not just jokes. Promoting her work on Twitter helped bring eyeballs to Scanlon’s Substack newsletter, where she deconstructs financial topics in greater detail and sophistication than a one-minute video can allow. Those pieces include an analysis of the dollar-store business, an explainer on the reverse repo market, and a reflection on the role of meme culture in raising equity valuations.
But Scanlon’s success on Twitter and TikTok has brought a degree of unwanted attention as well, whether it be the man who direct-messages her with updates about his day or threats of stalkers. “Especially because I’m on there with my voice and my face, people think they know me a lot more than they do,” she says. “And because, of course, I’m out there being silly with my skits, people feel even more room, I think, to objectify me.”
But Twitter is undeniably a powerful tool, Scanlon says, and she makes a habit of only following people who provide in-depth analysis: “People who kind of take it seriously, but then they have fun with it, too.”
BOTTOM LINE – Twitter, along with TikTok videos and Substack newsletters, is helping young people in finance find an audience for their ideas.
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