TikTok Part 3: ‘I’ll Be Making Bank! Hopefully.’ - podcast episode cover

TikTok Part 3: ‘I’ll Be Making Bank! Hopefully.’

Apr 29, 202137 minSeason 2Ep. 3
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Episode description

TikTok has redefined American pop culture and upended the music industry, advertising and the economics of fame. In this episode, reporter Shelly Banjo examines TikTok’s hands-on approach with its creators and artists, minting a new generation of social media stars and positioning TikTok’s parent company as the first Chinese tech giant to come out with a truly global consumer app.

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Transcript

Speaker 1

I want to tell you the story of a girl from Mobile, Alabama who, from a very young age, knew exactly what you wanted to do. I started writing when I was nine, but I was I wanted to be a singer, and then I realized I couldn't sing. So then when I turned to liven, I started writing wraps and I wrote my first rap. It carried on to high school and now Flow Flow Millie is most definitely here. She's a twenty one year old rapper. What was the first rap of that? Um? Do you want me to

wrap it? Okay, walk up in the mall, all eyes on me, I get my swegga on with my jay's on my feet. I'm rocking this beat. Yeah, I'm rocking this beat. My swagga owner, Honey, can nobody touch me? I'm a five plus five yep, shotty, I'm a team. We made it this far, so we might as well win. Riding in my bid so you know, I'm getting paper. I'm busy stuffing on you, so I had to see you later. You know, I was like ten years old

when I wrote that. Flow spent the next year is going to school and working, but making music was her primary focus. Like many artists of her generation, she posted each new song online and one of her tracks called Beef Flow Mix started trending on a platform that Flow didn't even use, TikTok. Around this time, someone high up at TikTok took an interest in Flow Millie. She came to the offices and she didn't even have a TikTok profile at the time. That's Isabel Keen Terrorists a news.

She's head of music Partnerships at TikTok, and she personally sat down with Flow Millie and urged her to come onto the platform. TikTok prides itself on helping discover emerging artists. After like, you know, fift twenty minutes talking to her, I was like, you're really funny, Like you're just like a funny person and you're beautiful, and I think you would do really great on platform. I promise you once have one song go viral, your chances of going viral

again increase. And that is exactly what happened. And so after that, like it just kept going up, and then on TikTok it just went crazy. Like so it was about a month after that labels was coming up, not even a month Honestly, it was like a couple of weeks and I was just flying in New York, flying everywhere. I like cash in my head to my ass, Duda Dash, can you make it go fast? The same my life one of the bands. If she keeps on lugging, and then Flo's life changed. Her fame on TikTok has given

her mainstream music success. She signed on to r c A Records and the b ET Hip Hop Awards nominated her for Best New Artists. Honestly, I didn't choose this path, but I will embrace it, you know, like the fact that my music made on made it on TikTok. But I would just say that I'm just using it to my advantage. Flamilli isn't just a rapper who got her start on TikTok. Now she's a creator as well, pumping out videos and growing up following on the app. And

she did amazing. She's at five hundred thousand followers, her content gets millions of views, so I think that she's very much on her way, doesn't need me as much anymore. Flow Millie was singled out as a musician who would make it on TikTok, and she's not the only one. TikTok understood that to attract hundreds of millions of users to its app, they had to keep their users happy

by taking bold steps. That meant hands selecting the popular people on the app, creating paths towards fame, and funneling money to individual creators. So for the top TikTok creators and musicians, TikTok was more than a platform. It became their job. You're listening to Foundering. I'm your host, Shelley Banjo. In the first two episodes, we told you the founding story of TikTok, how two guys from China created the

idea and the technology for what we now know as TikTok. First, there's Alex Jew, an eccentric guy from Shanghai who is obsessed with design and understanding how teenagers behaved online. He created Musically, which was folded into TikTok. And then there's John gi Ming, the CEO of by Dance, TikTok's parent company. Eming secret Weapons are advanced AI algorithms that taylor videos to each individual while also gathering enormous amounts of data.

In this episode, we'll explain how Alex and e Ming were able to plot a path for TikTok that would not only change the world of social media, but also upend pop culture, music, and the economics of fame. Suddenly, this app from China that many people had never heard of was determining multiple facets of American culture, who gets to be famous, which music ss will hit it big,

and what trends are people talking about. By harnessing its newfound popularity and influence, TikTok's Chinese parent company, Bye Dance made even more money and became the first Chinese company to successfully create a truly global consumer app. We'll tell you more after a quick break. TikTok was coming up in the US right when an app called Fine was falling apart. Vine was the original short video app. It played six second videos over and over again on a loop.

We in his speech for a get abrazon Fleek question. And even though the memes launched on Vine, levon Vine is remembered as a failure because after Twitter bought Vine, they completely squandered its success. Someone said Vine walked so TikTok could run, And I think that is a really accurate, uh analogy. That's Karen Spencer. She used to work at

Twitter as Vine's head of creator development. Karen says that a handful of Vine stars got pretty famous and that became a problem for Vine because the creators wanted something that Vine just wasn't willing to give them money. There were a lot of conversations had between creators and myself where they were making demands that Vine pay them for every Vine that was posted. That was not something that

Twitter was comfortable doing. In a last ditch effort to show some love to their creators, Fine held this big party in November, but it didn't exactly go as planned. Fine through a party to just basically show the influencers we care, we appreciate what you're doing, and it completely backfired. That's Darwin Metzkert, a social media marketer. He says the

lavish party actually made the Vine creators more resentful. All of the viners looked at this party and how much money they spent and literally just went back to their apartments. They all literally lived together one building on Fine Street, not making that up in Los Angeles, and basically said, well, if they have all this money to spend on a party, how come there's no money for us. Within weeks, the Viners left the platform, and Darwin says Fine lost sixty

of its traffic. Less than a year later, Twitter announced it would shut down Vine completely. It didn't matter how funny or innovative or beloved the platform was. Fine just wasn't a sustainable business. Fine took an approach towards creators that was common among social media companies in the US. They were essentially saying, we'll give you an app that you can use to become famous and make money, but

you're on your own to do the rest. What that means is that the creator doesn't feel any allegiance to the platform. I'm sure you remember that moment when um Kylie Jenner tweeted, you know Snapchat is dead or I've deleted Snapchat, and those types of things happen because they don't have relationships with the people at the companies, and so they're not thinking about Snapchat, the faceless brand, the company that I don't know anyone at, So I'm not

worried about hurting someone's feelings. When by dance spot musically and rolled out TikTok in the US, they weren't going to make the same mistakes during this delicate transition, Alex Jew was paying close attention to the creators. I remember like working in the office and Alex would spend like two hours a day just flipping through his phone watching like TikTok videos, and I was like, that's a fun job, Like I want to do that more. That's Michael buzzing

over a product manager at TikTok. He goes by buzz. He says the switchover from Musically to TikTok felt like a balance act because Musically already had a hundred million registered users, it had brand deals and famous creators. Everyone on the team was talking to creators and telling them that like there's something big coming and this is happening, and I did some calls they were like what's TikTok. For weeks, Alex Jew gathered all the phone numbers of

the top creators on Musically. They spent hours calling creators personally to assure them that rebranding as TikTok would be a good thing. The Bye Dance CEO, John u Ming was about to invest a lot of money into making sure TikTok was successful, and they were just on the cusp of hitting the mainstream. Guys last week on the show, I told you about this cool app that I've been

getting into called TikTok. It lets you post short videos of you doing fun stuff like lip syncing or acting out a silly scene in Jimmy Fallon spoke about his fun new pastime on the Tonight Show, and he did more than just talk about TikTok. He urged his audience of two point five million nightly viewers to get on TikTok. And I asked you guys to make videos of yourselves dropping to the ground and rolling around like a tumbleweed every time you hear this. So in just a few days,

you guys made over eight thousand videos. It's got over nine million views. That's that's crazy. Thank you so much. TikTok says it didn't pay Jimmy Fallon to post on the app, and Fallon's team declined to comment. But this was a planned partnership and part of a deliberate strategy by the company recruit well known American celebrities to shine

some of their star power on TikTok. Do you identify a couple of whales, you pay them for a certain number of posting them sort of a flywheel from there because you know, the internet is like it is like high school cafeteria is the second the popular kids do it, everyone wants to get in. This person was a high

level advisor to Bite Dance. It's his real voice, but he wanted to be kept anonymous, and TikTok was able to cater to these way e from a massive marketing budget that John Giving at Byte Dance gave Alex jew The plan was to make TikTok V place for celebrities and artists and drive more people to the app. It would be a major achievement for a company from China.

I think every Chinese company wants to prove that it can, you know, penetrate the US because the US is still dominant in terms of soft power um and so you know, this is why they invested literally a billion dollars you know what is it a year ago on making sure that TikTok was number one, which obviously worked. A spokesperson for TikTok says they didn't spend one billion dollars. He declined to tell us their global ad budget, but said

they spent three million in US advertising a loan. Still, this point on soft power speaks to something I've noticed while I was reporting in China. See American culture has huge influence overseas. In China, kids watched The Big Bang Theory, They wear NBA jerseys, and they listened to Taylor Swift. China has long wanted that kind of cultural press. Stage By Dance had just raised a lot of money and they were willing to spend big to make TikTok ubiquitous

in the US. Like I mean, that's a ridiculous marketing budget. That's I think that's an indication of the willingness to put resources full throttle. But like I would also argue, that's just paying your way up the charts. On New Year's Eve, TikTok beamed its logo on the facade of the Burj Khalifa in Dubai, the world's tallest building, and on the other side of the globe. In New York City, the TikTok logo was adorned at the very top of the ball drop in Times Square. It went beyond billboards.

The Bye Dance CEO, John gi Ming, wanted to flood the Internet with TikTok ads to accelerate the apps growth, and he was actually using TikTok's competitors American social media companies as a way to gain new users. Here's the former Bye Dance employee, John Boyd Bolton. You know, Bye Dance would create slick little ads that show why TikTok's cool and and it would have, you know, the little installed button on it. And so they did that in

a way that I could be unprecedented. Frankly, it's really ironic looking back that Facebook and Snapchat we're running TikTok ads as if they were encouraging their own users to leave and join another platform. TikTok's competitors might not have known it at the time, but TikTok was coming for them. Most of them didn't even know that they were spending

so much money. Um. And that was surprising to me because it was kind of so obvious, Like how could an app come out of obscurity suddenly be number one over and over again and penetrating the mainstream this rapidly. The only way to do that is to pay, Like even Facebook's organic growth was not like that, if anything, like, I would say, many of them were not taking it that seriously. Um. I think maybe they regret that now.

That was the Bite Dance advisor who spoke anonymously. He said, Snapchat, YouTube, and Facebook had a blind spot when it came to TikTok, and that was dangerous because TikTok was poaching many of the prized employees. One of TikTok's smartest hires was Vanessa Papas from YouTube. She literally wrote the YouTube creator playbook. It's like the bible for social media stars on turning

their fame into a profession. And this meant that TikTok would run the most aggressive creator focused strategy of any social media company. We'll be right back. Meet Gabby Murray. She's an eighteen year old from Florida. So I woke up pretty early and then I did my morning workout. Then I gave myself some clothes for the day I changed. She's been on TikTok since the app first launched. It was one summer. I was super bored and my mom was working and I really wanted to do something fun.

And I always love to be on camera ever since I was little. I love movies, and so I wanted to have this goal to get bigger on the app. Gabby now has more than seven million followers. She remembers the first time one of her TikTok videos went viral, and I love Stranger Things. Stranger Things is one of my favorite shows. I thought of this idea. I got my wardrobe on and I pretended to be like eleven from Stranger Things, UM and I and I opened, like, put my hand out and I opened the door with

my mind, which I didn't actually do. I edit it, but it looked pretty dope. That was the video that got me like the big numbers for sure. I love how Gabby clarifies that she didn't actually open the door with her mind. Gaby quickly realized that getting famous on TikTok was not just an art but a science, because, unlike its competitors, TikTok gives creators a roadmap on how to reach more people if you're on Twitter or Facebook.

Most hashtags start trending organically when lots of people post about the same thing, but the popular hashtags on TikTok are often hatched within the company or sponsored by brands. They're often referred to as challenges. When Gabby is making her videos, she follows the TikTok playbook. Yeah, so when you use a trending hashtag, it just pushes the video out to the algorithm more and essentially you get more likes, follows, shares,

you just get more of everything. Gabby says that after she got a big enough following, TikTok even assigned her an individual manager to keep her updated on current trends. But I do have a TikTok representative or like a micro manager if you want to call it that. Gabby might have a different definition of micromanager. And um, she actually sends like an email of like all the trending hashtags and everything that we should be doing, like what are the new features on TikTok and using those tips

can get you more exposure? Do you think that they work? Yeah, no, for sure. I've actually tested it out one time and the video did super well for me, And um, it wasn't something I would typically post, but I just wanted to try it out because she said so, so I just tried it. A TikTok spokesperson told me that using a trending hashtag does not necessarily guarantee more views, and organic trends still emerge on the platform. But I want to highlight Gabby's point about the TikTok rep who works

with her at Facebook or Twitter. This kind of thing tends to happen with the president or like Kim Kardashian. YouTube does this with their really big stars. But almost every TikTok creator I've ever spoken to with more than say, a hundred thousand followers has told me some version of the same story. The highly personal touch doesn't just come

out of the goodness of TikTok's heart. This is a shrewd business move because the more attention TikTok showers on creators and musicians, even ones who aren't superstars, the more loyal they become on the app, and the more they post on TikTok, the more users TikTok draws from Instagram, YouTube, and Snapchat. So at this point you might be wondering how much is Gabby Murray making. Oh gosh, man, you can take a lot. I mean, you know, Charlie Addison, all those people make way more Like I mean, I

guess Addison made five billion this year rumored, has it? Uh? That's insane on TikTok alone, And I don't even think it's been a year since she was popular. Like it's wild. But for me, like on a good month, I would say anywhere from ten to fift twenty grand um, which is fantastic. Charlie and Addison are actually two different people. They have a TikTok stars Addison Ray and Charlie Jamilio. Forbes says that each of them make over four million

dollars a year. But Gabby's bringing home annually up to two thou dollars. Let's just sit with that for a second. That's a lot of money. And now she has her sights on more. Gabby's decided to put college on hold and try her luck in l A. I have representation in l A. And it's it's a it's a commitment, and I'm making money. I'm making a good salary and and I think I should take this opportunity. Now I can always go back to college. So I'm gonna be

making bank hopefully, right, that's the goal. So well, she can only make bank if her manager can actually get her on the phone. Here's Brian Nelson, who represents Gabby and a roster of teen influencers. I will tell you that the anxiety level for me is very high. Most of them don't want to talk on the phone at all. They don't like to read press or just read in general. They like to watch video, so when Brian has a job opportunity for them, they can be hard to reach.

They won't read or talk, and they're the great communicators of our time, but they're kind of communicating like the way they want to Finding them is actually our biggest problem. To be honest, you're I mean, I wish I can chip every single one of them. We'll be right back. TikTok has created a new economy, so to speak, which can support young TikTok stars like Gabby and managers like Brian.

It might sound like some incredible flute, but it actually follows the blueprint that can be traced right back to Alex to the way I look at it, Viewing a community is very similar to running a country, running economy, and you want people from Europe to migrate to your country? Right? And is what I means Europe? Facebook is Europe? Okay, you do it. That's Alex speaking at a tech conference. In the person you hear laughing is Josh Alman, one of Alex's early investors. I just want to point out

something funny in Alex's metaphor. The Chinese owned app TikTok is America, and the American owned apps Instagram and Facebook are Europe. And bear with me here, this elaborate metaphor is actually pretty alien. Alex likens the people joining TikTok two settlers moving to a brand new country. How can you attract those people to come in the problem with Europe is the social class is already stabilized. For average citizen of Germany, of France, they have almost zero opportunity

to go upper in the social class. Right, So here Welton social class are standing for social media fame, and Alex is saying the chances are blowing up on Instagram now are slim because it's already so crowded. But TikTok would be uncharted territory, the wild West, where average people can move and maybe strike gold. And then these people became real model for other people living in Europe, and they say, hey, this is a normal guy and he

just went to America and he became super rich. I can do the same, right, And then lots of people came to your country and your girl population, you girl, you can't. Alex also knew it wasn't enough to just focus on the top creators the royal class. To use this terminology, you also had to create a path and a promise for the lower classes to climb the ranks that if they post a lot of videos on TikTok, then one day they too could become famous and they

make money along the way. Having an American dream is good, but if it's only a dream, people will wake up. You have to give the opportunity to average people and make sure it got such function, make sure it was around middle class coming up. This strategy that Alex laid out would actually work to a t TikTok did draw creators and artists away from Instagram and Facebook. They did provide new ways of getting famous on social media, and you can see the most extreme examples of that in

TikTok's collab houses. A very quick tour of the new hype house. We'll start here Elevator, Nick rm It's Massy Movie Theater room, Andrea's, Michael's cubby, Tony's Room, Thomas Room on the second floor. If you've never heard of a collab house, these are mansions where a bunch of TikTok stars lived together and create videos. Race three to one.

It's a bit like real World meets Shark Tank. Imagine a sleepover but forever and now living with my friends, like these are my best friends, Like I grew up with these kids. That's Alex Warren. He's twenty years old and has around fourteen million followers on TikTok. He's one of the founding members of the Hype House, a TikTok mansion in the Hollywood Hills. Alex Warren has eleven roommates, ages seventeen to twenty two, and each of them has

millions of followers on TikTok. You're never alone. There's always something happening, like someone's screaming. We have a bus outside that we just got. I had bought a golf cart. Like with cycles, we have drift cards. By the way, I had to look up what a drift car is. You know how in some movie chasings a car might skid sideways and a cloud of smoke against the direction of the wheels. Apparently you can buy a car build just for that purpose. Anyway, the Hype House is a

mansion full of toys. It's a nine million dollar house with a theater and elevator and a pool, and of course there are multiple balconies to shoot videos and glorious outdoor light. The Hyphaus even has brand sponsorships. There's this energy drink that's featured in a lot of the Tiktoker's videos. Deceptively, these TikTok mansions are also workspaces. They allow the TikTok stars to create videos together and build off each other's followings.

This gets some more attention and bigger brand deals, and again, that doesn't just benefit the creators, it also means more viewers and more money for TikTok and Alex Warren is quick to point out that it's not all just fun and games. He says that, well, being an influence and shooting short videos might look easy, it's hard work. This is real work. It's different, it's not something you're used to, but it is real work. And this job is hard.

And the amount of times I've gotten where it's like, oh, you know, you don't have a real job, and it's like, it's not what my taxes say. He wouldn't say exactly how much he's making. I can't tell you that that's a good try though, but he would give a ballpark figure seven figures a year, so that's at least one million dollars a year for Alex Warren. But what does TikTok get out of it? Well, droves of teenagers tune in every day to TikTok to follow Alex's every move.

Some of them copy his dances, dream his favorite music, and try to replicate his silly pranks, and most importantly, many of his TikTok followers by the stuff that he and his high house roommates tell them to buy. The TikTok stars drive up the time users spend on the app, and also trek brands to advertise through the platform. Now TikTok is experimenting with online shopping. They're placing buttons right and brand sponsored videos that can lead users to buy

whatever it is the creators are selling. So while Alex becomes a millionaire, TikTok is getting richer too. Alex Warren was doing so well on TikTok that when I spoke to him recently, he'd even become a job creator. I've been doing this all myself for the last few years. Recently I've hired a manager. Obviously, it's hired an assistant, So I totally believe that churning out videos every day is hard work. But I had to stop Alex to ask, what exactly does the assistant of a twenty year old

TikTok star do? My assistant does too much. I love him. I just hired him like last week, but like he is, I don't know. I have him do everything, which has so helpful because I get costumes, I get um skis, I get stuff to tew people from the back of my car, like and then um. Once he's done with that, then it's like, you know, I need to switch over to Verizon, I need to go to the d m V. I need to um just everyday stuff that, like a normal system would help us. And it's not just the assistant.

He likes. TikTok doats on alex morn. They set him a basket of gifts when he reached ten million followers, and TikTok set him cookies for his birthday. It sounds weirdly chummy, but some of this can be explained by cultural differences. In China, there's often a close relationship between social media companies and their stars. TikTok's parent company Byte

Dance wose creators from rival platforms. Some get paid to post videos on the Chinese version of TikTok, and the CEO, John Giming, even created hundreds of salaried positions for creators in China, meaning they received regular paychecks from Bye Dance. This was almost unheard of in the US. The closest you got was YouTube, which does fund a small number of channels and original content, but most of the creators there make money by enabling ads on their videos, and

there was no guarantee. TikTok took a much more hands on approach. They're not making any of the mistakes the Jack Dorsey and Vine made by not providing really proper monetization channels for their talent. That's Starwin Metzker, the marketer we heard from earlier. He says brands like Chipotle, the NBA, and Red Bull picked up pretty quickly that TikTok would be the way to reach the much sought after gen

Z audience. Now brands are going directly through TikTok and having TikTok negotiate with big TikTok stars for branded sort of native content. Uh and those deals are going to skyrocket because a you get to weaponize this talent that means something to their audience, but also TikTok controls all the levers to make sure it gets whatever view count it's promised to a client. It's really a perfect platform for advice. So to be clear, the ad runs on TikTok.

The creators are famous on TikTok. TikTok can control the reach of the ad, and TikTok has connected the creator to the product they're selling, meaning TikTok is on every end of the deal and the money flows right back to TikTok. This all makes the platform even bigger and allows them to spend even more. Because the creators owe their livelihoods to TikTok, they tend to be fiercely loyal to the app. One minager told me that TikTok even created a scholarship for a TikTok star to pursue a

master's degree. Isabel can tro Us The News, the head of Music Partnerships at TikTok, says they take a similar approach with musicians. We spend a lot of time texting, messaging, emails, phone calls. I don't necessarily need to be in real life to help you, but they do have like access to me um as much as I can give that, and Isabel has even personally visited the homes of artists

on TikTok to advise them on videos. TikTok even pairs artists with brands for sponsorship deals and sometimes takes a cut along the way, because the more money artists can make through the app, the more money that flow was into TikTok. The company prioritizes music because music is the backbone of the app. Almost every skit or meme on

TikTok is time to a song. Every video predicated on a beat, so without music, TikTok probably wouldn't have become the online playground and the soundtrack for an entire generation. As TikTok gains power in the music industry, it even

sometimes tells the record labels what to do. When the rapper Megan the Stallion was first getting popular on TikTok, her label wanted to put their marketing muscle behind a song called Captain Hook A little bit of Curve, Collet Niggle Captain Hook Adult Shop, but Isabel said no. Instead, she advised them to put five songs out on TikTok

and then just lurk and see how they do. So Captain Hook did okay, and but Savage you could just see um, the creation amounts like in a short period of time were incredible bowl and then it just was just growing exponentially every day. So after seeing Savage far outperformed Captain Hook any other songs, TikTok moved all its

marketing attention towards promoting Savage. We let it sort of simmer um in the app, and then we started seeing that Savage was going and even then I we held promo levers to just let the sound mature to the right point where then when we pulled everything that we had against it, it just propelled it to number one. When TikTok moved to promote Savage, it turned the song into a monster hit, reaching number one on the Billboard charts.

Megan the Stallion recorded a remix with Beyonce which even mentioned TikTok and the lyrics and featured TikTok clips in the music video. Talk about incredible advertising for TikTok. This is another thing that go back to Alex jew He knew early on to steer clear of outright competing with the record labels. Here he is we only accuse music as a role material. Music is not in the product. Having the music or musically actually helped them to generate revenue.

This tape from Alex is really revealing. First of all, he's talking about music as raw material, like it's slumber or steal, because music is the basis for the videos people make, catchy songs or what makes TikTok so addictive. But also as much as the music industry makes it seem like TikTok was this accidental hit maker, Alex is saying that all this was planned from the start, that TikTok launches hit song after hit song by design. I spoke to Judge Alio, who worked for alex A musically

back before it was folded into TikTok. She says, they put an enormous effort into winning over the music industry. We negotiated deals of basically all the big record labels, the ones I remember our Warner and UM Universal. Yeah, so I think UM. At the beginning, they just didn't understand it. They're like, why are you guys doing these fifting seconds you know, music clips, Like what is what

is this? That they didn't understand what was going on because it was such a new format by Dance inherited all these relationships with the record companies when they purchased musically, and they became just one more way for Bye Dances

CEO John gi Ming to buy power and influence in America. Initially, music executives were skeptical about doing business with Eiming and Bye Dance because it was a Chinese company, and China was notorious for stealing intellectual property, including ripping off music. You know, I think there was some natural skepticism of like, hey, can we trust these guys. You know what's going to happen. We've had issues in China with with intellectual property. That's

John Boyd Bolton. He was the American guy in the room presenting Bite Dance, so it was his job to quell the fears from the record labels. You know, there was a lot of just trying to reassure the industry that these are good guys. They're they're trying to do the right thing. You know, they're American investors insist on it. Otherwise they won't they won't have a successful business if they don't do this right. And John's reassurance has worked.

TikTok has now launched the careers of a generation of artists. It's so influential that record labels, brands and advertisers, so they can no longer turn away from TikTok, even if they don't quite understand it. Here's tark alham Dooney, an executive at our c A, the label that signed Flow Millie. We've never seen this before, and I and I and I haven't seen it consistently from any platform ever. We're just over and over and over again. Kids are able

to take records and turn them into hits. After the music industry fully embraced TikTok, it was like the company had arrived. The gatekeepers of American pop culture determined that tick talk was in. But I want to bring up something bitter sweet here. Just as TikTok's growth was exploding, Alex Jew decides to take a leave of absence from the company. He told his co workers, I need some time off. I'll let you know when I come back. Alex had achieved this massive success. He sold his start

up and made a lot of money. His theories about stardom and music turned into a profitable business model. But still he felt aimless and exhausted. He needed a break. He later told The New York Times that he spent these months clubbing in Shanghai and listening to a lot of jazz. In Alex's absence, TikTok mostly answered to the Bye Dance execs in Beijing and the CEO, John Yu Ming, and TikTok seemed to fulfill you means wish his social media platform had won over the world. But this very

powerful app had a very large dark side. Because for all the fun people were having on TikTok, there were plenty of murky corners of the app filled with videos about anorexia, bullying, in sexual exploitation of the very young kids who were on the app, And because of the way TikTok's highly personalized algorithms work, it was extremely hard for parents and regulators to track what was going on and what kids were being exposed to on TikTok. We'll

tell you more about that next time on Foundering. Foundering is hosted by me Shelley Banjo, Sean wyn Is, our executive producer, Lucas Shaw, Sarah Fryar, Tom Giles, and Isabel Lee contributed reporting to this episode. Special thanks to Mark Bergen and Champion quant Raymondo is our audio engineer, Molly Nugent is our associate producer. Our story editors are Mark Million and Vander May and Alistair Barr. Francesca Levi is the head of bloom Work Podcasts. Be sure to subscribe

and if you like our show, leave a review. Most importantly, tell your friends see you next time.

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