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In 2024, the social media world is witnessing a significant event: the IPO of Reddit, under the symbol ‘RDDT’, marking one of the most anticipated Initial Public Offerings (IPO) of the year with the goal of raising $748 million. With a valuation of $6.4 billion ($34 per share), Reddit ranks as one of the largest public launches since Snapchat’s debut in 2017.
Reddit’s business model
Reddit embodies a unique platform where community, belonging and empowerment are at the core. Founded in 2005, Reddit grew to over 73 million daily active users in Q4 2023, an increase of 27% year-on-year. The company reported sales of USD 804 million in 2023, with a net loss of USD 91 million, showing an improvement over the previous year .
Reddit is distinguished by its democratic approach to content sharing and evaluation, based on positive or negative votes by users. This mechanism ensures that the most popular content gains visibility. The business model includes advertising, premium subscriptions and the sale of digital goods such as Reddit Coins and NFT.
A new era for Reddit
Reddit’s IPO not only represents a significant milestone for the company, but also provides an opportunity for users and moderators who have contributed significantly to the platform to become shareholders through a direct share programme. This reinforces the sense of belonging and ownership that users have towards the communities they have created on Reddit.
Reddit and artificial intelligence: the partnership with Google
Reddit has taken the first steps to allow third parties access to the platform’s data, including the training of artificial intelligence models, with licensing agreements worth a total of $203 million. One notable agreement is the one with Google, which allows Google’s AI products to use Reddit’s data to improve their technology.
Reddit’s upcoming IPO marks the beginning of a new chapter for the company, which continues to offer a space where millions can explore interests, share experiences and connect in an authentic way. With an eye on growth opportunities for both platform and business, Reddit is heading for a promising future in the global digital landscape.
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