Reddit goes public and invites users to buy shares

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A popular social and news aggregation platform Reddit officially announced it had filed its S-1 registration statement with the SEC to become a publicly traded company. The platform offers Class A common stock on the New York Stock Exchange under the “RDDT.”

The number of shares and price are yet to be determined before going public. Reddit has disclosed the number of its active users and revenue in the S-1 documents handed to the SEC. Accordingly, Reddit has 73 million daily users and over 100,000 active communities at the time. The platform’s total posts have also surpassed the 1 billion mark.

Reddit will become a publicly traded company on the New York Stock Exchange

Founded in 2005, the 18-year-old San Francisco-based company reported an $804 million revenue for the 2023 fiscal year, which shows a 20% increase. Meanwhile, the company had a net loss of $90.8 million last year, making it unprofitable.

As NYTimes reports, Reddit seeks a valuation of at least $5 billion. The company was valued at $10 billion in a 2021 private financing round. The final price will be determined after careful evaluations by bankers.

Reddit also considers selling an unspecified number of its shares to “certain users and moderators identified by us who have meaningfully contributed to Reddit community programs.” So, the platform’s loyal customers can buy shares before other investors and hope to make an early profit.

Additionally, users with a karma score of at least 200,000 and users who have performed at least 5,000 moderator actions can buy shares in the Reddit IPO sooner than everyone else. Reddit also announced it had saved 1.3 million shares of its Class A common stock “to fund community-related programs that empower Redditors to bring their ideas to life.”

Reddit uses its data as an advantage to sign AI training deals

CEO Steve Huffman said, “I have never been more excited about Reddit’s future than I am right now.” Huffman added that Reddit now has the chance to grow its platform and business through advertising, monetizing commerce, and licensing data. Reddit CEO also said their data advantage and intellectual property are “key elements” in training future LLMs.

On Thursday, Reddit announced an AI training deal with Google to help the tech giant train its AI models. The deal is reportedly worth $60 million per year. The company previously blocked AI startups from scraping its data for free.