Triller has pitched its app as a TikTok replacement, but says it won’t try to generate revenue directly from its namesake product

• Triller said it won’t try to generate revenue directly in the short-video app it was named after.
• The company has regularly positioned its app as an alternative to TikTok over the years.
• It revealed the business “refocus” in an S-1 filing as it pursues a public listing.

Triller has decided not to make money directly from the TikTok-like video app after which it was named, according to an S-1 document filed earlier this month as part of its plan to go public on the New York Stock Exchange.

Triller stated in the risk factors section of its preliminary prospectus that “as part of a reorganization and refocus of Triller’s business in 2022, it was determined that the Triller App would not be a revenue generating business model.”

The company still intends to monetize the Triller app indirectly, as content posted on Triller and shared elsewhere as part of its “open garden” model may lead to revenue generated by its other businesses, such as its influencer-marketing platform Julius.

“The app itself serves as a conduit to our AI technology, which is integrated into almost every social media network, not as a ‘endpoint’ for anything, including monetization,” Triller spokesperson Michael Green explained in an email to Insider. “Comparing the Triller app’s lack of revenue generation to traditional business models would be like asking about the miles-per-gallon of an electric car — it’s not an applicable metric for understanding our business.”

However, the company’s declaration that Triller, a video app similar to TikTok or YouTube shorts, will not generate revenue on its own highlights a fundamental difference between its business model and other social-media platforms to which the app has been compared. Triller has consistently positioned its app as a competitor to TikTok over the years, particularly when politicians and regulators have expressed concern that TikTok’s Beijing-based owner poses a national security risk.

“With the looming ban on TikTok, Triller is quickly taking pole position as the hottest short form music app,” the company wrote in an October 2020 release, shortly after the Trump administration announced plans to remove TikTok from app stores. After Trump’s TikTok ban fell through and other US officials continued to investigate the app, Triller CEO Mahi de Silva advocated for a TikTok ban in a July 2022 blog post.

“The company isn’t shying away from the fact that we were certainly saying, ‘Hey, we’re a great alternative to TikTok,'” Green explained. “I’m sure Triller would have quickly shifted if the TikTok ban had occurred.”

While TikTok and other social-entertainment companies make money primarily from the ads that run on their platforms, the Triller app’s importance to its parent company’s identity has waned over time as it has acquired and launched new businesses. It’s divided into categories such as boxing, rap battles, SMS marketing, and others.

According to Green, the Triller app is not central to how the company makes money. Triller will therefore record costs associated with the Triller app as sales, marketing, general, or administrative expenses rather than as a cost of revenue, according to the company’s filing with the SEC. These costs could include paying talent and influencers to drive Triller app adoption, or paying to license music for the app as a brand-building tool, according to the report.

Triller’s revenue is now primarily generated by other business lines, such as its combat-sports streaming platform, FITE, influencer-marketing platform, Julius, and creator-fan engagement tool, Fangage. Triller reported that overall revenue increased by roughly 80% year on year to $47.7 million in 2022. It provided snapshots of how much historical pro forma revenue some individual businesses brought in during specific time periods in its securities filing. Julius, for example, earned approximately $4.4 million between January 1, 2022 and October 31, 2022. Between January 1, 2021 and July 29, 2021, FITE generated approximately $22 million in revenue.

Triller’s net loss was around $196 million last year, a significant decrease from 2021, when the company went on a buying spree and lost more than $700 million.

The Triller app, which displays a stream of short videos featuring musicians and other content creators, has traditionally contributed only a small portion of the company’s overall revenue. Triller’s B2C unit, which included the app, accounted for less than 3% of the company’s 2021 revenue, according to 2022 SEC filings compiled as part of a now-defunct plan to complete a reverse merger with video-tech platform Seachange International. Triller abandoned its reverse merger strategy in June 2022 and opted for a direct listing.

Triller has also reduced the cost of the Triller app in the last year. It removed music from Triller’s major rights holders in late 2022, around the time that music partners like Sony Music Entertainment and Universal Music Group sued the company for alleged bill nonpayment. Triller stated in its S-1 that it saved $7.7 million in Q1 2023 by cutting music licensing costs.