Reddit’s highly anticipated initial public offering (IPO) is generating significant buzz as it is currently between four and five times oversubscribed, with a sought-after valuation of $6.5 billion. The IPO, set to be priced in New York on Wednesday, is expected to range between $31 to $34 per share.
Despite originally aiming for a higher valuation after a successful $10 billion private fundraising round in 2021, Reddit has lowered its expectations. The social media platform has faced challenges in matching the commercial success of competitors like Facebook and X (formerly Twitter).
One of Reddit’s unique aspects is its reliance on volunteer moderators to monitor content, which has led to some moderators quitting in protest over certain decisions. The platform’s “wallstreetbets” forum gained notoriety for its role in the “meme-stock” craze of 2021.
In a nod to its user base, Reddit has reserved 8% of total shares for eligible users, moderators, and others associated with the company. The platform boasted an average of 73.1 million daily active users in the last three months of 2023.
Reddit refrained from commenting on the overwhelming demand for its IPO. Investors are eagerly awaiting the pricing of the shares and the subsequent trading frenzy that may follow. Stay tuned for updates as Reddit makes its highly-anticipated debut on the public market.
“Travel aficionado. Incurable bacon specialist. Tv evangelist. Wannabe internet enthusiast. Typical creator.”