Reddit Shares Soar Following IPO and New York Stock Exchange Debut

It is not rare for social media organizations and companies to tap stock markets to go public, with major success especially seen when one of the biggest and earliest US social media companies’ IPOs, Mark Zuckerberg’s Facebook, got through in 2012.

The world then witnessed the IPOs of more social media platforms like X, formerly known as Twitter, and Pinterest, the latter social curation and image-sharing platform going public in 2019. Pinterest’s public action led to early employees earning millions, and founder and former CEO Ben Silbermann became worth over $1B.

This time around, society witnesses social media platform Reddit go public, the company first filing for an IPO in late February and hitting the New York Stock Exchange (NYSE) on March 21, and the trading begins.

RDDT

Reddit attempted its first IPO back in 2021, filing a confidential S-1 with the Securities and Exchange Commission. The company proposed the number of shares and a specific, undisclosed price range and had been rumored to consider an IPO for quite some time. The company’s plan was disclosed along with the possibility of doubling staff by the end of the year and an announcement of $700M raised in funding at over $10B valuation.

The company’s first attempt faltered, however, and Reddit waited until February 2024 to try again. This time, CEO Steve Huffman stated that the company is seeking to gain more control over the vast corpus of valuable data it requires to join the generative AI game.

Placed under the name RDDT, Reddit shares debuted at the price of $34 and quickly rose 48% on their first day on the NYSE, closing at $59.80 per share. Early Reddit investor Sam Altman, also CEO of OpenAI, witnessed his stake in Reddit grow from $200M to over $613M following the debut, and several Reddit moderators and users, often referred to as Redditors, taking part earned millions as a group.

Though Reddit is historically known as a growing but unprofitable and money-losing company, especially compared to many other social media companies, the investor appetite during its first day as a public company indicates a consistent loyalty towards the company.

Community Potential

Founded in 2005, the community-focused message board platform has about 267M active weekly users as of 2024, with over 100K active communities and 1B posts. Reddit unveiled in its IPO filing that the company faced $90.8M in losses in 2023, and this was a decrease from 2022’s $158.6M loss as the company’s revenue grew by about 21% during the year.

The consistent rise in Reddit’s shares may indicate that countless users and members of the Reddit community are staying loyal, the loyalty shared by Huffman as well, as he stated that the decision to go public was made not only to make Reddit itself a stronger company but also with hopes of providing meaningful benefits to the community.

Huffman’s years of work on Reddit have made him a witness to Reddit users’ deep sense of ownership over the communities they’ve built and run, and by going public, Huffman believes that the company will be able to ship better products faster for its devoted community.

Georgetown University’s Psaros Center for Financial Markets and Policy director Reena Aggarwal believes that, with Reddit share supply being pretty limited coupled with their strong demand, the Reddit IPO will be a hot one. As of Monday, Reddit’s IPO has raised about $748M, and analysts believe the company will continue to thrive and perform positively in the stock market.

Source: US Securities and Exchange Commission 

Meme & AI-Generated Picture

Job Posting

• Reddit - Principal Engineer, Core Platform - San Francisco, CA (In-Office/Hybrid)

• Reddit - Senior Machine Learning Engineer, Ads Optimization - San Francisco, CA+ (Remote)

• Reddit - Staff Data Scientist, Threat Detection - San Francisco, CA (In-Office/Hybrid)

• Reddit - Staff Software Engineer, Ads Creative Management - San Francisco, CA+ (Remote)

Promote your product/service to Digger Insights’ Community

Advertise with Digger Insights. Digger Insights’ Miners are professionals and business owners with diverse Industry backgrounds who are looking for interesting and helpful tools, products, services, jobs, events, apps, and books. Email us [email protected]

Your feedback would be greatly appreciated. Send it to [email protected]