Users can access these features by paying for a monthly or yearly subscription. The rest, as they say, is history.Ī huge reason why CapCut has been able to grow this fast is the free nature of the app, which begs the question: how does CapCut actually generate revenue?ĬapCut makes money by charging users for premium features. The tech behind Flipagram and Musical.ly, plus their existing userbase and music licenses, were then integrated into TikTok.

Meanwhile, ByteDance already operated a highly popular TikTok-like app in China called Douyin, which had amassed a substantial user base before TikTok was even launched. It previously acquired popular Western apps Musical.ly and Flipagram for hundreds of millions of dollars each. The playbook that ByteDance used to grow TikTok is awfully similar. By May 2021, CapCut was already topping international app store charts and exceeded 250 million downloads. In April 2020, ByteDance quietly launched an app called Viamaker, which is essentially the predecessor to CapCut.Ī mere 8 months later, ByteDance rebranded Viamaker into what is now formally known as CapCut. Once it became the de-facto leader in the country, it was time to branch out abroad. Shenzhen Lianmeng Technology had previously developed the popular app Faceu, which topped China’s free app charts in both 20.īyteDance then integrated the firm’s technology into Jianying. In 2018, for instance, ByteDance purchased the startup Shenzhen Lianmeng Technology for $300 million. One way how it did that was through acquisitions. Meanwhile, ByteDance continued to extend its functionality. Jianying quickly rose to the top of the Chinese app charts. In 2017, the tech firm launched the app in China under the brand name Jianying. Interestingly, ByteDance applied a similar playbook to establishing and growing CapCut. CapCut is owned by Chinese tech giant ByteDance, which also happens to be the company behind the money-printing machine that is TikTok.

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