ByteDance’s Use Of Secondary Share Sales:
Private companies historically faced a choice – go public, or stay small. Yet, today this is no longer the case.
ByteDance, the parent company of video sharing platform TikTok, and one of the most valuable private companies in the world, has recently completed a secondary sale at a valuation of $600 billion. Some grey market quotes even valued the business at $900 billion, showing that the business is edging towards a $1 trillion valuation.
However, it is not the huge valuation which has caught the eye – instead it is their words and actions, with their founder Liang Rubo stating that a public listing is “not on the table at this time” (Nikkei Asia).
This is significant as it reflects the trends that we are seeing in the private market, with companies choosing to stay private longer – yet it takes this one step further. Instead of rushing to IPO, Bytedance are happy to use equity sales and secondary sales to stay private longer, however seeing their founder’s statement and their clear lack of urgency raises a key question; are Bytedance and other similar companies not only staying private for longer, but looking to avoid an IPO altogether?
What Is A Secondary Share Sale?
A secondary transaction is a sale of existing shares from one holder to another, where no new capital is raised and no new shares are issued. As a result, the company’s ownership changes hands, but the balance sheet does not. Every trade on the ASX is a secondary transaction, and in listed markets the whole process is standard: transparent pricing, standardised settlement, legal certainty on both sides.
In private markets, none of that infrastructure exists by default. Without a regulated platform sitting in the middle, secondary transactions can happen infrequently and often without the company’s knowledge.
Why Are Some Companies Hesitant About Secondary Transactions?
Companies are often hesitant to use secondaries because they find the process complex or unfamiliar. But there is often another issue – the way secondaries typically happen creates real regulatory risk.
They historically occurred as follows: A shareholder would find a buyer through a broker, a bulletin board, or a personal introduction and they agreed a price between themselves.
Settlement would be tricky – requiring a manual update to the share register, which the company would only realise when a name it didn’t recognise appeared on the cap table.
This would create real problems like governance gaps, valuation uncertainty, and potential compliance issues.
However, now secondary platforms can help to remove these concerns, particularly through regulated platforms such as FCX. FCX uses tokenisation to turn assets into digital tokens, recorded on a distributed ledger. This allows for a near-instant settlement time. This process also creates an automated, immutable record, helping to improve compliance and remove governance gaps.
Case Studies Of Secondary Use In Major Private Companies:
There are two other strong examples of how companies have used secondary share sales to alleviate market pressures.
Given that many companies use IPOs to either provide employees with liquidity, or gain capital, using periodic secondaries removes the need for either of these.
The first case study in executing this is Stripe.
Stripe has completed a series of tender offers at continuously rising valuations: $91.5 billion in February 2025 and $159 billion in February 2026 as seen here. One of their founders stated in early 2026 that an IPO “isn’t one of our top five or ten or twenty priorities,” despite being a major private company.
The founders have also discussed Fidelity as an example of a company who have never gone public, yet remain effective.
Therefore, despite having profitability and cashflow, it is clear that staying private for as long as needed is something that Stripe has considered, and something that can be done through their use of periodic secondary share sales.
Global financial platform Revolut has been on record stating that they’re not planning for an IPO before 2028. However, it will be intriguing to watch if their IPO ever actually occurs.
Revolut completed a share sale in November 2025, offering shares at around $1381 per share. This deal allowed employees to sell shares to a range of institutional investors. While this allowed employees and early investors liquidity, this also stood out given the unique benefits which it provided the company, where they allowed price discovery, without exposing the company to public markets. As a result, Revolut was able to offer price discovery and liquidity, without having to face public market volatility – showing that they are harnessing the benefits of being a private company.
The Need For Regular Secondaries As A Vehicle To Retain Talent:
There is another perspective that makes the benefits of secondary share sales clear – they are a great way to attract and retain talent. Although small businesses can’t always match the salaries or incentives offered by larger corporations, they can offer equity in the company, typically through programs called ‘ESOPs’. ESOPs offer employees a way to gain lump sums of money as the company grows in valuation, and their share price grows.
However, there is no way for employees to realise the value of their equity, unless they have a way to sell their shares. This is where secondaries are beneficial, as they allow employees to sell their shares and access financial gains which were effectively ‘trapped’ otherwise.
Given that equity is a key tool for attracting and retaining talent, secondaries should be a core part of any private company’s strategy.
Is It Still Necessary For Companies To Go Public?
Despite recent trends outlining the desire of companies to stay private for longer, it is clear that major global companies such as ByteDance, Stripe and Revolut may be looking to avoid going public altogether.
Each of these case studies raises the same question: is it still necessary to go public?
Given how accessible and common secondary transactions are becoming as a way to offer investors or employees liquidity, it appears as though using an IPO to enter the public market may no longer be a necessity. As companies continue to explore using regulated secondary platforms, staying private for as long as necessary is emerging as a clear alternative to going public.
What is FCX, And How Does It Allow Companies To Stay Private?
Australian companies exploring secondaries now have a regulated option built for exactly this. FCX is Australia’s first fully licensed secondary platform, regulated by ASIC and the RBA.
FCX offers companies two distinct ways for private companies to run a secondary liquidity event, either through an auction market or a tender market.
FCX also uses distributed ledger technology, enabling atomic, near-instant settlement and creating an immutable, audit-ready record. This replaces the manual processes that have traditionally made secondaries slow and risky.
If your business is exploring using secondaries or accessing liquidity, get in touch with FCX to see how a regulated platform can provide your company with liquidity solutions.