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Obvious PR move, they don't have near enough money.

xp84 2y ago
Kmart bought Sears (back when Sears was far from worthless, and Kmart was fresh off a chapter 11) with nothing but its own overvalued stock, which was based on an inflated valuation of its real estate from a couple of very favorable sales. Point being, don’t rule out financial shenanigans if people who know what they’re doing are involved. (Note: I know nothing about who runs Perplexity)
thatguymike 2y ago
They’re suggesting a merger, not a sale.
- jsnell 2y ago
  That doesn't really help here. TikTok is at an absolute minimum an order of magnitude more valuable than Perplexity, more likely two orders of magnitude. If ownership of NewCo was even roughly proportional to the market value each side is bringing, the ownership structure doesn't meaningfully change compared to TikTok. And when the ownership structure is the problem, it's obvious that this deal structured as a merger would solve nothing. They'd need to bring a couple of hundred billion to the table; and then we're back to this being just embarrassing, because obviously the money isn't there.
  - JumpCrisscross 2y ago
    > TikTok is at an absolute minimum an order of magnitude more valuable than Perplexity, more likely two orders of magnitude They don't need to buy TikTok, they need to buy out Bytedance. If I had to structure it, I'd have Bytedance spin out TikTook to its U.S. shareholders and then arrange for Perplexity to buy enough of Bytedance's share that Bytedance holds a 49% (non-voting) interest.
    - fakedang 2y ago
      Bytedance without TikTok is still an order of magnitude worth more than Perplexity.
      - JumpCrisscross 2y ago
        > Bytedance without TikTok is still an order of magnitude worth more than Perplexity They’re not buying Bytedance - TikTok, they’d be buying half of the piece of TikTok Bytedance would own after spinning it out to its non-Chinese shareholders.
        deleted 2y ago
        [deleted]
    - jsnell 2y ago
      I know. That's why I wrote "value of TikTok". Not market cap of ByteDance. And to get a controlling share of the merged entity, you'd need to be bring hundreds of billions of value to the merger, not a clownshoes AI startup.
- handfuloflight 2y ago
  The point still stands, they don't have enough of a relative valuation to even be considered serious and a balance sheet that would be a rounding error to ByteDance.

xp84 2y ago

Kmart bought Sears (back when Sears was far from worthless, and Kmart was fresh off a chapter 11) with nothing but its own overvalued stock, which was based on an inflated valuation of its real estate from a couple of very favorable sales. Point being, don’t rule out financial shenanigans if people who know what they’re doing are involved. (Note: I know nothing about who runs Perplexity)

thatguymike 2y ago

They’re suggesting a merger, not a sale.

jsnell 2y ago
That doesn't really help here. TikTok is at an absolute minimum an order of magnitude more valuable than Perplexity, more likely two orders of magnitude. If ownership of NewCo was even roughly proportional to the market value each side is bringing, the ownership structure doesn't meaningfully change compared to TikTok. And when the ownership structure is the problem, it's obvious that this deal structured as a merger would solve nothing. They'd need to bring a couple of hundred billion to the table; and then we're back to this being just embarrassing, because obviously the money isn't there.
- JumpCrisscross 2y ago
  > TikTok is at an absolute minimum an order of magnitude more valuable than Perplexity, more likely two orders of magnitude They don't need to buy TikTok, they need to buy out Bytedance. If I had to structure it, I'd have Bytedance spin out TikTook to its U.S. shareholders and then arrange for Perplexity to buy enough of Bytedance's share that Bytedance holds a 49% (non-voting) interest.
  - fakedang 2y ago
    Bytedance without TikTok is still an order of magnitude worth more than Perplexity.
    - JumpCrisscross 2y ago
      > Bytedance without TikTok is still an order of magnitude worth more than Perplexity They’re not buying Bytedance - TikTok, they’d be buying half of the piece of TikTok Bytedance would own after spinning it out to its non-Chinese shareholders.
      - deleted 2y ago
        [deleted]
  - jsnell 2y ago
    I know. That's why I wrote "value of TikTok". Not market cap of ByteDance. And to get a controlling share of the merged entity, you'd need to be bring hundreds of billions of value to the merger, not a clownshoes AI startup.
handfuloflight 2y ago
The point still stands, they don't have enough of a relative valuation to even be considered serious and a balance sheet that would be a rounding error to ByteDance.