Reddit Looks For $6.5bn Valuation In NYSE IPO

Reddit is looking for a valuation of up to $6.5 billion (£5bn) in an upcoming IPO on the New York Stock Exchange (NYSE), according to multiple reports citing unnamed sources.

The firm, which would be the first social media company to make its market debut since Pinterest in 2019, declined to comment.

The valuation is far lower than what the company was worth in 2021, when a $1.3bn funding round valued it at $10bn, according to PitchBook.

Reddit filed for its offering in February and plans to trade under the ticker symbol RDDT.

Social media IPO

It is reportedly seeking a price range of $31 to $34 per share.

OpenAI chief executive Sam Altman has the largest tranche of shares, worth over $400m at the desired valuation, after leading a $50m funding round into Reddit in 2014. Altman was on Reddit’s board from 2015 to 2022.

Tencent and Advance Magazine Publishers, the parent company of Condé Nast, are other notable shareholders.

Condé Nast bought the platform in 2006, a year after it was founded, before spinning it off in 2011.

According to its latest IPO prospectus Reddit saw $804m in annual revenue in 2023, up 20 percent year-on-year, and narrowed its net loss to $90.8m for the year from $158.6m the year prior.

User participation

Reddit’s non-staff moderators have been offered an opportunity to participate in the offering, a user participation strategy mirrored by Airbnb and Rivian.

Moderators have a history of conflict with the company’s decisions, and locked key forums for weeks last year over a disagreement about API pricing, which executives said was necessary to prevent data scraping.

Reddit is looking to license content to firms such as AI companies for training purposes, and said recently it had reached such a deal with Google.