Reddit is looking to hire investment bankers and lawyers as part of its plans to go public early next year at a value of more than $15 billion, Reuters reported Thursday.
Reddit most recently raised money in a private fundraising round in August at a valuation of $10 billion — meaning that an IPO at a valuation of $15 billion would represent a dramatic 50 percent increase in the company’s valuation in just a matter of months.
The timing and size of the popular online message board’s IPO could change depending on market conditions, sources told the outlet.
The news comes three months after Reddit co-founder and CEO Steve Huffman teased the possibility of an IPO earlier this year, telling the New York Times in May that the company was “thinking about” and “working toward” going public. He did not provide details about timing or valuation.
Reddit — which was founded in 2005 and is minority owned by Condé Nast parent company Advance Publications — declined to comment on the Reuters report.
Other investors in Reddit that could reap a windfall if the company goes public include venture capitalists Peter Thiel and Marc Andressen, celebrities Snoop Dogg and Jared Leto, as well as Chinese tech giant Tencent and US asset manager Fidelity Investments.
Reddit was known in the 2000s and 2010s for its niche discussion groups, or “subreddits.” The San Francisco-based company lagged behind other major social media competitors like Facebook and Twitter.
But Reddit saw explosive growth during the pandemic as retail investors flocked to the forums like r/WallStreetBets to talk about trading “meme stocks” like GameStop and AMC, as well as cryptocurrencies like bitcoin and dogecoin.
The site had 52 million daily active users as of October 2020. Huffman has said it gained millions of new users earlier this year during the height of the trading frenzy, but the company has not released updated statistics.
Reddit makes most of its money through advertising. It reported $100 million in advertising revenue in the second quarter, an almost threefold jump from the same period last year.
With Post wires