ByteDance expands itself in e-book business with an investment of $165M

ByteDance has agreed to invest 1.1 billion yuan ($165.6 million) in Chinese e-book reader and publisher Zhangyue. With this investment, the TikTok owner will get an 11.23 per cent stake in Zhangyue. The funding will be done through ByteDance’s wholly-owned subsidiary, Beijing Liangzi Yudong Technology Co Ltd.

E-books and audiobooks are becoming increasingly popular across the globe. A Statista report estimated China’s online literature market to reach around 20 billion yuan ($3.1 billion) in revenues by 2020. This estimated figure is up from 15.4 billion yuan ($2.3 billion) in 2018.

ByteDance exploring new markets

ByteDance gained a huge audience and international recognition because of its short video platform TikTok and its Chinese version Douyin. The company is now focusing on pivoting away from being just a short video maker. It is expanding itself in several new areas and this latest investment demonstrates its interest in the same. Apart from this, ByteDance recently ventured into enterprise software via its Lark app. It also forayed into online education business with its Dali Education Brand.

This year was tough for all enterprises, courtesy COVID-19 pandemic. But it can be said that the year was especially hard for Chinese tech companies, mainly ByteDance. All of its short video platforms, TikTok, Halo etc, faced immense scrutiny in their largest markets, India and the US. In India, the app was even banned, while in the US it was on the verge of being banned. The US ban may be accomplished in case Donald Trump wins the presidential elections. However, not much can be said as the state judges do not favour the banning decision.

About Zhangyue

Zhangyue is one of the most popular e-book reader apps in China. It lets users access novels, audiobooks, anime etc. The app, also called iReader, has about 110 million monthly active users. Its current valuation stands at $1.65 billion, according to PitchBook. In the first three quarters of the year 2020, the company generated 1.5 billion yuan ($225.8 million) in revenue. This was an increase of 7.8 per cent from 1.4 billion yuan during the same period last year. Zhangyue is in tough competition with Tencent spinoff China Literature and Kuaidian which has secured around 100 million USD from Sequoia Capital China.