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Reddit wants to raise $748M with IPO, sets value at $6.4B

• NickC25 3y ago
  Not sure Reddit is truly worth that amount. At the end of the day it's still a relatively anonymous message board with a bit of advertising. How is that worth over 6 billion? Yes, they have a treasure trove of human written communication, which could prove valuable for AI models, but that's really it. They've taken a number of bad decisions as a company and I'd argue their management has had a number of high-profile gaffes over the last few years. They don't have a good mobile app (quite the opposite, to be honest). I haven't seen any new products from them, the site is their only product and they haven't innovated at all. Their newest UI is actually pretty shitty and encourages doom-scrolling. What's the real reason behind such a valuation?
  • johng 3y ago
    Their AI revenue seems to be the main reason for their IPO. I suspect that revenue source could go poof quite quickly.
    • NickC25 3y ago
      My point exactly. Markets are always forward looking. My guess is that the value of the AI data is effectively "priced in" as it's pretty much the sole reason for the IPO. Markets would look and say "well, ok, what's next?" and since Reddit most likely has no idea what is next, or even has the ability to create new products, the stock value would drop pretty hard. Single-product companies don't really work well when it comes to public markets, unless they come with pretty big growth upside in terms of recurring revenue and consumer market penetration.