Reddit IPO, Valuation, Date, Deal with Google

Reddit IPO Date, Valuation, Price Prediction 2024
Reddit IPO Date, Valuation, Price Prediction 2024

Reddit has successfully filed the paperwork for its IPO (Initial Public Offering) this week on Thursday and its all over the news. The Reddit IPO was filed on the New York Stock Exchange (NYSE) to trade under the symbol “RDDT“.

Reddit is the first social media company to get public with an Initial Public Offering after Pinterest, which took place in 2019.

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Key Details from Reddit IPO

  • The Reddit IPO is filed on the New York Stock Exchange (NYSE).
  • Reddit ticket symbol is RDDT
  • Reddit IPO is open for everyone and longtime Reddit users will also be able to buy RDDT shares
  • The bankers are looking at a valuation of at least $5 billion from the Reddit IPO
  • OpenAI CEO Sam Altman invests more than $60 million into Reddit ahead of its IPO.

Reddit Valuation

A report from Business Insider reported that Reddit would be seeking a $15 billion valuation as a part of its plans for the Initial market offering. After the Reddit IPO, it seems that the Reddit’s bankers are looking at a valuation of at least $5 billion from the Reddit IPO, which is around half of the $10 billion valuation the company saw in a 2021 private financing.

Reddit’s valuation is around $10 billion around its IPO.

Reddit IPO Date

The Reddit IPO date is not yet announced but it seems that the Reddit may hold its initial offering in and around March 2024.

Statistics of Reddit

Following are the stats of Reddit as disclosed in the Form S-1 Registration Statement:

  • Active Communities in Reddit – 100K+
  • Average Daily Active Uniques – 73 million
  • Average Weekly Active Uniques – 267 million
  • Cumulative Posts – 1 Billion
  • Reddit Revenue in 2023 is $804 million
  • Reddit Revenue in 2022 was $666.7 million

Reddit’s Investments in Crypto

As Reddit went for the Initial Public Offering, it has disclosed that the company has investments in cryptocurrency – specifically Bitcoin (BTC) and Ether (ETH).

Reddit also disclosed that some of the excess cash reserves of the company were used to acquire Bitcoin and Ether. Currently, Reddit uses Ether and Matic as a form of payment for sales of certain virtual goods and it said, that the company may continue to do it in the future.

It is to be noted that though Reddit has disclosed its investments in crypto currency, the company hasn’t disclosed any specific amount of crypto currency it holds.

Open AI CEO Sam Altman’s Invests ahead of Reddit IPO

Reddit has disclosed that the CEO of the ChatGPT creator OpenAI, is one of the shareholders with more than 5% of its capital Stock.

It has been reported that the entities associated with CEO Sam Altman have bought more than a million shares at an aggregate purchase price of more than $60 million. The company prospectus indicates that Sam Altman’s investment has gained him 9.2% voting power.

Reddit and Google AI content licensing deal

Reddit has recently entered into an AI Content Licensing deal with Tech Giant Google. The details about the Reddit-Google deal is not mentioned in the company prospectus.

As per sources, this deal gives the Search Engine Giant Google access to Reddit’s user-generated content, which Google will use to help train its large language model AI systems.

In a report, Google said it “will now have efficient and structured access to fresher information, as well as enhanced signals that will help us better understand Reddit content and display, train on, and otherwise use it in the most accurate and relevant ways”.

Reuters cited that unnamed sources have disclosed the Reddit-Google AI Content licensing deal is woth $60 million per year.

[Sources: Form S-1 Registration Statement, FastCompany, Investoedia, TweakTown]