Zhitong Finance and Economics learned that Reddit, a social platform with the title of "American version of Tieba", allows some of the most active users to buy in the upcoming IPO. This week is the deadline for these users to pre-register to purchase**. According to people familiar with the matter, about 750,000 users were eligible to purchase**. The move is designed to give moderators of Reddit forums and people who write content for free a chance to earn some financial rewards.
So far, users on the Reddit platform have been skeptical. The Wallstreetbets forum has threatened to short the stock, with many pointing out that the company is still losing money 20 years after its founding. Reddit lost $90.8 million last year, down from $1 the year before$58.6 billion. Some users have complained that the investment invitation does not make up for the unpaid labor they put into the operation.
Despite the fact that users like to complain about Reddit, the number of users of this ** continues to grow. This will be one of the key factors for investors to focus on as Reddit proceeds with its long-awaited IPO. In the last quarter of 2023, daily active unique users grew by 27%, the fastest growth in the last seven quarters. Last quarter, the platform had 267.5 billion. In comparison, the popular chatbot ChatGPT has around 100 million active users. According to SimilarWeb, Reddit is one of the top 10 most visited in the United States**.
Matthew Kennedy, senior strategist at IPO research firm Renaissance Capital, said Reddit was "a unique asset and a very popular part of the internet community". "I don't think they're going to go away. There are reliable users. Kennedy noted that Reddit's ** forums are mostly bearish on the company's IPO. "I think users can see exactly that reddit is unlikely to have a large **," he said. But he added that with this **, anything can happen.
The company's IPO plans have been on hold for more than two years as tech startups are struggling. Now, Reddit will be the first high-profile tech IPO of the year, potentially setting the stage for a larger IPO boom. The social behemoth could be valued at as much as $6.5 billion. Previously, in a round of funding in 2021, Reddit reached a valuation of $10 billion.
Every social ***x, Facebook, and TikTok, to name a few, have had to contend with users who are hard to please, but Reddit's dilemma is unique. Its users are very loyal and very aggressive. Reddit users have considerable influence, often in an unavoidable way.
In 2021, the platform's WallstreetBets forum sparked a meme** frenzy that pushed GameStations (GME.).US) and AMC Cinemas (AMCUS) and other ** soared and sent shockwaves through the financial industry.
Reddit mentions the risks posed by users in its IPO filings. "Given Reddit's widespread popularity and brand recognition, including the popularity of R Wallstreetbets among investors," the company warned that it could "experience extreme volatility......If you are unable to achieve the Offering Price or above the Offering Price***, you may lose all or part of your investment. ”
Despite the challenges, the company sees its user base as a source of future revenue. Reddit said in its IPO filing that the company is "in the early stages of monetizing its user base" and that it is "still expanding our ad revenue model," which is the main part of its sales**.
"Reddit is one of the largest, most authentic and continuously updated libraries of human experiences on the internet," the company said in the document. The company added that it wants to ensure that the company's actions "do not conflict with our values and the rights of Reddit users." ”