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Reddit IPO: Potentially $6.5 billion in valuation
Reddit, a popular online platform known for its vibrant communities and diverse forums, is making headlines as it gears up for an initial public offering (IPO) that could value the company at up to $6.5 billion. They looking to set a price range of $31-$34 per share.
Founded in 2005, Reddit has grown to become a digital haven where users can share news, participate in discussions, and connect with like-minded individuals across a myriad of topics, ranging from the everyday to the niche. Reddit’s structure allows users to upvote or downvote content, ensuring that the most appreciated and relevant discussions are more visible (something I personally really like - it gives a quick glimpse of the worthiness/accuracy of a certain reply).
According to its prospectus, Reddit had over 73 million daily users as of December 2023, participating in more than 100,000 communities. This is a 27% increase compared to the previous year. For context, when Facebook, now known as Meta, went public in 2012, it had about 500 million daily users, a number that has since grown to 2.1 billion.
In comparison, $Snap Inc (SNAP.US)$ had 414 million daily users at the end of the last quarter, showing a 10% yearly increase. Since the first quarter of 2021, Reddit has seen its daily user count grow by 33% and its revenue per user (how much money it makes from each user) increase by 138%.
Reddit's revenue per user was $3.42 in the last quarter, which is about 26% of Facebook’s and similar to Snap's $3.29. Despite this, Reddit is not yet making a profit. In 2023, its revenue was $804 million, a 21% increase from the previous year, but it still lost $140 million, though this was an improvement from the year before. Reddit estimates its potential market for advertising, not counting China and Russia, at $1.4 trillion.
The decision to go public marks a significant milestone for Reddit, which has been privately held since its inception. By launching an IPO, Reddit aims to raise funds that will help it enhance its services, invest in new technologies, and potentially broaden its user base.
The question is, will YOU subscribe to Reddit’s IPO? :P Vote below!
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Foodgae : sad how they gutted and destroyed Reddit before the IPO
Adam Andrew Foodgae : How did they get gutted ? Mind sharing your thoughts just for informative purposes.
Sau SaKe Adam Andrew : I heard it’s because of its new data policy that would charge some third-party apps for the use of Reddit data. A lot of subreddits opposed it and they wanted Reddit to respect their volunteer work and not limit the access to Reddit data for developers and users of third-party apps.
Adam Andrew Sau SaKe : Ohh I see I remember now. There was a boycott awhile back for a few days and all subreddits were offline for awhile. Might’ve been related to the same thing. But thanks for the insight !
All Also Taken : public is wrong again