In the pitched battle between TikTok and Washington, few people stand to lose more than Jeff Yass, an American billionaire options trader who has emerged in recent years as a major donor to Republican candidates and causes.
Yass co-founded the Philadelphia-based trading firm Susquehanna International Group, which owns a 15% stake in TikTok’s China-based parent company, ByteDance. Yass’ personal share is 7%, worth roughly $21 billion.
Yass’ investment is under threat today, and the typically press-shy billionaire is taking fire from both the left and the right. Critics accuse Yass of bankrolling an army of lobbyists and orchestrating a bare-knuckle pressure campaign to protect TikTok — including by leveraging his nascent relationship with former President Donald Trump.
Through a spokesperson, Yass declined to comment on this story.
On Wednesday, the House is expected to pass bipartisan legislation that would force ByteDance to divest TikTok within a matter of months. President Joe Biden said that he would sign it into law if the bill wins Senate approval.
“It would be a gut punch to the valuation and future of TikTok if a ban and forced sale came to fruition,” Dan Ives, a managing director and senior equity research analyst at Wedbush Securities, said in an email.
“This would be a nightmare for Yass, given the major investment in TikTok, if a forced ban hit the company under the Biden administration,” Ives said. The impact would “likely be a 25% hit to the overall valuation.”
Susquehanna first invested in ByteDance in 2012, long before the company created TikTok and then merged it with a short-form video app called “Musical.ly” in 2018. When the app exploded in popularity, Susquehanna’s investment paid off.
Today, at least 150 million Americans use TikTok regularly, according to company data.
Yet lawmakers on both sides of the aisle say TikTok’s soaring popularity is part of the reason it poses a grave threat to national security. They argue that ByteDance’s Beijing-based engineers and executives are amassing a dangerously large trove of data from tens of millions of Americans.
The House bill “is about ensuring we’re protecting the data of the American people, and making sure our foreign adversaries can’t be targeting our people and using that data against them. That’s what’s happening, we know that for sure,” Rep. Chip Roy, R-Texas, told NBC News on Monday.
The company has said it stores U.S. users’ data securely and rejects the idea that it poses a threat to national security.
TikTok CEO Shou Zi Chew is expected to visit Capitol Hill this week to meet with members of Congress, part of an 11th-hour lobbying campaign to halt the bill in the Senate.
Behind the scenes, Yass may also be helping to shape the debate over TikTok.
A major player
Jeff Yass is not your average billionaire who wants something out of Washington.
During the 2022 midterm elections, Yass donated $47 million to help Republican candidates and committees, making him the third-largest conservative political donor in America.
Yass has described himself as a registered libertarian and served for decades as a trustee of the nonprofit Cato Institute, a libertarian Washington think tank. A media representative at Cato did not reply to a request for comment from CNBC.
By all accounts, Yass’ No. 1 animating issue is “school choice,” the largely conservative movement that aims to give taxpayer dollars to families to help them pay for private schools. Yass and his wife have poured millions of dollars into federal and state elections, as well as nonprofits and initiatives, aimed at expanding alternatives to public schools.
According to a person granted anonymity to discuss Yass’ political giving, the Pennsylvania-based billionaire makes decisions about supporting candidates based entirely on their “school choice” positions.
The causes and candidates Yass gives money to have nothing to do with TikTok, the person said, at least not necessarily.
For example, Yass donated $6 million in December in support of Texas Republican Gov. Greg Abbott’s re-election bid.
Abbott sides with Yass on “school choice” issues, but in 2022 the governor signed an executive order banning TikTok from government-issued cellphones and computers.
Overlapping interests
In Washington, several prominent conservative political groups support “school choice” policies and also oppose the TikTok ban.
The Club for Growth is one of them. A major supporterof “school choice” candidates and bills, the organization and its related groups have also worked hard to mobilize opposition to a TikTok ban on Capitol Hill.
“Giving the government the power to ban apps and pick and choose between competing apps is a huge restriction on phone freedom,” Club for Growth’s David McIntosh wrote in an op-ed last March on Fox News’ website.
Over the course of 2023, Yass gave $16 million to the Club for Growth Action, a political action committee affiliated with the nonprofit.
On Friday, the group magnified a post on X from Tesla CEO Elon Musk, in which he agreed with former President Donald Trump’s unexpected announcement that he opposed the TikTok ban.
Trump’s about-face on TikTok came just a week after he briefly met with Yass and his wife. The former president told CNBC Monday that their conversation did not turn to TikTok, but rather covered education-related matters.
The meeting took place at the Club for Growth’s donor retreat in Florida, the source familiar with the matter explained. At the retreat Trump delivered a speech praising Yass and McIntosh, according to Politico.
Trump’s flip-flop was especially surprising given that Trump was the first president to propose a ban on TikTok.
“There are a lot of people on TikTok that love it. There are a lot of young kids on TikTok who will go crazy without it,” Trump told CNBC on Monday.
Source: | This article originally belongs to Nbcnews.com
