Tiktoker’s Company Accused Of Artificially Inflating Their Evaluation To Close To A Billion

Khaby Lame, the world’s most-followed TikToker with over 160 million followers, recently made headlines for a $975 million deal that has left financial analysts and industry observers questioning how the numbers add up.

The transaction involved Rich Sparkle Holdings, a Hong Kong-based public company, acquiring Lame’s brand management company in an all-stock deal that sent the firm’s valuation soaring from $50 million to over $16 billion on paper before crashing back down.

The deal’s structure has raised significant concerns among securities experts. Forbes has already stated they won’t count Lame as a billionaire from this transaction because the value exists only on paper, not as accessible cash.

One securities attorney described the situation as “very suspect,” while another analyst compared the stock chart patterns to pump and dump schemes they’ve observed in the past.

Rich Sparkle Holdings presents a particularly unusual profile for such a major acquisition. The company only went public last summer, was valued at approximately $50 million at IPO, and reportedly made less than $6 million in revenue during 2024.

Their primary business? Printing financial documents. Following the announcement of the Lame deal, Rich Sparkle’s stock price jumped more than 650 percent, briefly trading above $180 per share.

However, analysts noted that only a small number of shares were actively trading, meaning even minor transactions could dramatically move the price.

The valuation has since collapsed, with shares plummeting from around $180 to approximately $40. This volatility, combined with the thin trading volume, has prompted scrutiny from market observers who question whether the deal’s announcement was designed to attract retail investors rather than reflect genuine business value.

Adding to the complexity, a third company called Three Sheep Group will actually operate Lame’s commercial business for the next three years. Three Sheep, led by influencer Crazy Little Brother Yang, is one of China’s largest online viewing commerce operators.

However, they’ve faced regulatory challenges, including a $10 million fine from Chinese authorities for misleading marketing practices and a temporary suspension of operations.

The business plan centers on transforming Lame from a traditional influencer into an AI-powered sales platform. The strategy involves creating a digital twin of Lame that can conduct online shopping sessions around the clock in multiple languages.

While AI salespeople have proven successful in China’s booming online commerce market, which is projected to reach $672 billion, the model remains untested in Western markets.

Former SEC investigators have noted that Rich Sparkle announced the deal as closed before filing all standard regulatory paperwork, which is unusual for a transaction of this magnitude. The lack of transparency regarding revenue projections, product timelines, and operational oversight has further fueled skepticism about the deal’s legitimacy and long-term viability.