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My theory is desperation. Reddit isn’t profitable, which was fine in the past few years because they could just raise another round of funding by pointing at th
by BlackjackCF 3y ago
My theory is desperation. Reddit isn’t profitable, which was fine in the past few years because they could just raise another round of funding by pointing at their user growth.
They can’t easily do that in the current financial environment. I suspect that they’re also seeing a plateau in year over year user growth. Bundle that up with everybody seeing advertising revenue decline and there’s no good story to sell to investors.
I think that they’re probably under tremendous pressure right now by their investors to at least get close to profitable so that they can IPO.
- sleight42 3y agoIronic given many third party app users would likely pay $60-100/year to continue to use their third party app. Now, we'll just stop using reddit and be sad about it. Missed opportunity due to... what? Desperation at Reddit?
- BlackjackCF 3y agoThat’s the end goal already with their API fees. They just handled the entire execution and messaging poorly. I think the Apollo developer mentioned that in order to break even with the new fees, they’d have to have subscribers who are paying $5/mo. To make a profit, third party apps would need subscribers who pay within the $60-100/yr range that you mentioned. Reddit probably knew this would cull the number of third party apps out there, which is to their benefit since their mobile app would have fewer competitors. I bet they’re also banking on most people not caring, or eventually coming back to the platform after a short period of time. I sincerely hope that they’re wrong and the user base doesn’t return.
- vincentkriek 3y agoI fully agree. Money is not free anymore, and investors want to see a path-to-profitablity. No one wants to dump millions into a possible profitable idea.