Reddit is moving forward with a plan to sell shares to the public, almost 20 years after its start as an online message board.
The company publicly filed for an initial public offering (IPO) with US financial regulators on Thursday.
The document does not say how much money the firm is hoping to raise by listing on the New York Stock Exchange. But it provides a glimpse of the firm's operations, including its struggles to turn its online popularity into profit.
The site is a forum where users can post questions and comment on topics that interest them. It has become known for its memes, candid conversations and the ability of its members to mass together and propel the share price of unlikely companies.
More than 76 million people, on average, visited every day in December 2023, drawn by features like its recurring “ask me anything” threads, in which participants ranging from anonymous nobodies to former US president Barack Obama field questions.
It was valued at about $10bn in a private fundraising round in 2021.
But the company has recorded losses every year since its start, including more than $90m last year. In the filing, Reddit said it had not started trying to make money seriously until 2018. It reported $804m in revenue last year, up more than 20% from 2022.
Advertising accounted for nearly all of the revenue, but in a note to prospective investors chief executive Steve Huffman said he was excited about opportunities to make the platform a venue for commerce and license its content to AI companies.
The company on Thursday said it was expanding its partnership with Google, which is licensing its content to train its artificial intelligence tools.
“I have never been more excited about Reddit's future than I am right now,” Mr Huffman wrote. “We have many opportunities to grow both the platform and the business, the latter through advertising, monetizing commerce on the platform, and licensing data.”
Reddit's IPO would be the first by a social media company since Pinterest in 2019.
It comes as financial markets in the US are regularly notching new highs, buoyed by optimism over the economy and a new wave of growth powered by artificial intelligence. Reuters said Reddit, which filed private paperwork for an IPO in late 2021, was expected to try to sell nearly 10% of its shares in the listing.
The company has said it hopes the move will give users an opportunity to take more literal ownership of the platform. It is reserving some of its shares for its most prolific users. On Reddit, the company's plans to go public have unsurprisingly drawn notice, and the reception has been mixed.
“No way I'm touching this with a 10 foot pole,” wrote one user, lafindestase, warning of the risk of bots infecting the site. While another posed the question: “Reddit IPO? Meme or mistake?”
Reddit was founded in 2005 by Mr Huffman and Alexis Ohanian, also known as the husband of tennis champion Serena Williams. Backers have included venture capital giant Andreessen Horowitz and China's Tencent Holdings, as well as rapper Snoop Dogg.
— CutC by bbc.com
