Before its shares go public for the first time in its upcoming IPO, it has been revealed that social media giant Reddit is aiming for a valuation of $6.4bn ($9.7bn AUD). The new shares will be floated on the New York Stock Exchange following an earlier unsuccessful attempt at an IPO in 2021.
Reddit aims for $6.4bn valuation
Reddit, a news aggregation site and forum network with over 73 million users, has never made a profit to date, but is regarded as one of the world’s biggest and most widely read websites. It has now revealed that its IPO will involve 22 million shares that will be sold for between $31 and $34 each (around $47-$51 AUD).
Co-founder Steve Huffman recently pointed out to potential investors that “our users have a deep sense of ownership over the communities they create on Reddit”. Huffman said he wants this sense of ownership to translate to actual ownership of shares. The IPO will see almost two million shares reserved for the site’s moderators and users.
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The forum was launched in 2005 and is now among the world’s top 20 most visited websites. Most of its revenue comes from advertising, but earlier this year, the site owners struck a $60m deal with Google to let the tech giant train its AI models using its forums.
Last year, Reddit reported a loss of over $90m, which continued its streak of successive losing years since its founding. The site came to prominence in the financial world for the part played by its users in the GameStop short squeeze in 2021.
