According to IPO Zhaozhidao Tencent is in talks with one of the world’s leading short video social platforms Kuaishou (快手), about investing around a billion and a half USD. Tencent first invested
USD 350 million in Kuaishou in March 2017, pushing its valuation to USD 2.5 billion. This investment will value the company at around USD 26 billion.
With TikTok’s market share increasing at a decent rate, Kuaishou could help Tencent compete more effectively with ByteDance.
According to Technode DAU on Wesee (腾讯微视) Tencent's very own short video platform, rose by one-quarter month on month to hit 7.5 million in June, whereas TikTok’s DAU for June was 320 million. This indicates how small of a competitor Wesee is of TikTok.
Since the past weekend, Wechat and Kuaishou started integrating functions, users can now share videos to Wechats feed and others will be able to repost them.
A report done on the short video industry of 2019 H1 by QuestMobile shows that the industry added 100 million new users. With a year on year growth of 32% in June 2019, the MAU reached 821 million. It was also seen that a user spends more than 22 hours per month on short videos, which is an 8.6% year on year increase.
"Tencent investment is fast, it should be officially announced. It accounts for 30%-40% of the shares, but it is not an acquisition. Similar to the model of investing in Jingdong in the past, the short video field will be handed over to the Kuaishou." A video industry executive told Beijing News.
A person close to Kuaishou executives also told Beijing News that "The relationship between Tencent and Kwai has changed recently, there will be new financing, and the official announcement will be made, and a new Kuaishou may be established."
It is said that an unnamed international investor has also shown plans to invest in Kuaishou for this new financing round.