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January 19, 2024
Reddit prepares to go public launch with IPO in March: report

Reddit is set to launch its initial public offering (IPO) in March, following up on plans more than three years in the making according to an exclusive report from Reuters.

It would represent the first IPO of a significant social media platform since Pinterest was floated on the market in 2019, and at a time when there is significant competition for advertising revenue with the likes of Facebook and TikTok.

Reddit is a San Francisco-based mega-website combining elements of social media, messageboards and news aggregation. It was founded in June 2005 by Steve Huffman and Alexis Ohanian who sold the platform to Condé Nast the following year. Huffman left the company in 2009 before returning as CEO, in 2015.

Last month, he spoke on speculation of an IPO to follow as well as the admission that Reddit was not profitable despite enjoying a user base of approximately 400 million accounts.

An IPO offering has previously been suggested but plans have been delayed until the company is closer to returning a profit and it looks like the time is now to test the water.

Floodgates to open

Reuters has indicated the company is “seeking to sell about 10% of its shares in the IPO”, whilst it “will decide on what IPO valuation it will pursue closer to the time of the listing,” according to their sources.

The information came with the caveat detailing the plans could be pushed back again but after Reddit quietly filed for its IPO back in December 2021, it will eventually need to strike out if the aspired returns are to be delivered.

It will be interesting to gauge to what extent Reddit users back the proposed listing, whilst Nasdaq reported “Goldman Sachs and Morgan Stanley are the two investment banks working with Reddit” with a sense of optimism and aiming for a breakthrough IPO launch that could open the floodgates for others to go public in 2024.

The IPO market has been muted since the Federal Reserve hiked interest rates to stave off the pressures of inflation but that could be about to change with candidates like Reddit, as well as Shein, inching toward a public launch.

Image: Brett Jordan/Pexels

The post Reddit prepares to go public launch with IPO in March: report appeared first on ReadWrite.


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