Reddit reveals plans to go public
Late hours on Wednesday, December 16, social media platform Reddit announced that it has initiated the process of turning its company public.
The company had filed a confidential S-1 with the US Securities and Exchange Commission (SEC), to inform of its proposals of going public.
As per the SEC regulations, they cannot provide any information or details about shares or prices until after a particular time period is over, in order to protect trade secrets from being leaked before an IPO date is scheduled. The SEC filing has confirmed long-running rumours about Reddit’s plans for a public offering underway.
Back in August 2021, Reddit had raised $700 million in a fresh funding, increasing its overall worth to more than $10 billion. In the latest update from the platform, Reddit has stated that it had made $100 million in its ad revenue for the second quarter of 2021.
The figure represents a nearly 200 per cent increase since the previous year.
Reddit also stated in a filing with the US SEC that the initial public offering is expected to be set only after the SEC has completed its review process, subject to market and other conditions.
At present, Reddit is competing with ad-supported social media platforms like Meta and Twitter. According to Huffman, the company has grown up “in the shadow” of Meta (formerly Facebook), and Google, and “every dollar they make is a struggle,” therefore.
Meanwhile, Reddit has already established its cryptocurrency, namely Reddit Community Points, or RCPs.
As of August 2021, Reddit had boasted about 52 million daily users and over 100,000 active subreddits. Reddit is a forum where several seasoned traders congregate for sharing their expertise. It is also highly famed as an extremely popular gathering spot for notorious meme stock r/wallstreetbets, which had a big influence on stock markets and cryptocurrency markets in 2021 with its retail trading and pumping tactics.
The group’s popularity was known to have prompted the creation of crypto counterpart r/SatoshiStreetB, which now has a total of 509,000 members.