Jinri Toutiao (今日头条, literally translated as “today’s headlines”) is set to score $2 billion at a valuation of over $20 billion in a new round of funding, according to unnamed sources quoted by Reuters. The report stated that China’s leading news aggregation app may get a new investor to lead the round—US private equity firm General Atlantic. Both Toutiao and General Atlantic have yet to confirm the deal.
Toutiao may not be well known outside of China, but in the local market, it has been called the new BAT. The company experienced a rapid growth since its founding in 2012. At the end of 2016, Toutiao secured US$ 1 billion in a series D round financing from investors including Sequoia Capital and CCB International, the investment arm of China Construction Bank. The funding raised its current valuation to US$ 11 billion.
The company is currently expanding its reach with its own news feed app or by investing in similar news aggregation platforms. Toutiao has so far entered North America where it acquired Flipboard, as well as Brazil, India, Indonesia, and Japan.
Toutiao owes much of its growth to its digital advertising strategy. Last year, Toutiao reported RMB 6 billion of revenues from in-feed ads. This year, the company’s founder and CEO Zhang Yiming has set the target at RMB 15 billion.
However, Toutiao’s AI-powered news aggregation system has also brought numerous accusations of copyright violations, with the latest coming from Beijing Time (in Chinese). In November 2016, the Ifeng news website sued the company for copyright infringement claiming RMB 22 million in damages.