11 ms·

Reddit's not profitable though..

by OGC 13y ago

chroem 13y ago
If there is one lesson that HN needs to learn, it's that profitable is not the same thing as important.
- FooBarWidget 13y ago
  So they are important, but need to live off ramen every day (figuratively). What good does that do to them? I don't think grandparent should be downvoted, he raises a good point. Tons and tons of people use Reddit, but Reddit has a hard time making a living.
  - cac04 13y ago
    > So they are important, but need to live off ramen every day (figuratively). What good does that do to them? Maybe they enjoy it? Maybe it makes them happy? Not everything is about money.
  - hackula1 13y ago
    Power and fame are strong motivators too.
- paulhauggis 13y ago
  Without cash flow, how far can the site go? Someone needs to pay the bandwidth/server bill. Not to mention it costs time to run a site. If you are working full-time at another job (because you aren't bringing any money in), you won't have any time to work on it. Reddit succeeded largely because the company that bought them is making money elsewhere.
  - straight_talk_2 13y ago
    >> Reddit succeeded largely because the company that bought them is making money elsewhere. Such a nonsense makes me angry. Surely you've heard about companies called Google, Facebook, Linkedin, that succeeded without being bought and for a long time not making a profit.
    - Wilya 13y ago
      The difference is Reddit isn't particularly looking for profit. Unless they completely change their business and way of doing things (unlikely to happen), they probably will never make a profit.
      - jherrick 13y ago
        Agreed. If they are re-investing money to grow the product, that might be why they aren't currently profitable. That doesn't indicate a lack of success in my book.
- gargoiler00 13y ago
  Look back in time. Read up on other things that had a massive userbase, but were unsustainable. Checkup alladvantage - they paid people to surf. Had millions of users, but ultimately failed because their "business model" was idiotic. Getting millions of users is pretty easy if you pay them to be a user. Someday though, it's only worthwhile if you can build a sustainable business which at least doesn't lose money hand over fist. If Reddit hadn't got bought and supported by other profitable businesses, I doubt it would have survived.
  - chroem 13y ago
    That was more of a general statement than a comment specifically on reddit's position. I can make millions of dollars selling condom wrappers, but just because I have made millions of dollars does not mean that I have done something important. I may catch quite a bit of hate for this, but a large portion of HN's content is on things that make money, but are not truly important.
    - gargoiler00 13y ago
      I think the mantra from the startup community is often: 1. Make money doing whatever it takes. eg come up with some crappy website, sell it to google, then shut it down. 2. The money problem is solved! 3. Spend money solving world hunger, diseases, philanthropy. Which IMHO is pretentious BS.
  - mrhazel 13y ago
    AllAdvantage was great for free money as a teenager. It only took a few minutes to slap together a VB application to move the mouse a few pixels every minute. I made a few hundred dollars from them while I slept.
    - mdellabitta 13y ago
      I guess I didn't have my act together enough as a teenager to commit fraud over the Internet while I slept.
- sbierwagen 13y ago
  I think that the endless stream of stories about websites shutting down and deleting all user content has made it clear to HN users that clearing a profit is pretty important.
adventured 13y ago
Reddit has an exceptionally low cost to scale ratio. Where are you getting the information that they're not profitable at this point (I know they weren't in the past)?
- gargoiler00 13y ago
  Last time they shared, they were spending ridiculous amounts of money on Amazon ec2 a month. Like ridiculous amounts. Someday, the money will run out, and they'll have to try and turn a profit. Their business model is fundamentally bad.
  - Keyframe 13y ago
    If those outdated figures of ~$50k/month are true, I wonder if they could move to their own infrastructure or dedicated and turn some of those savings into getting from red to black.
    - Terretta 13y ago
      Yes. We operate a dozen of our own colos, with a virtual colo on AWS for insta-scalable multi-region redundancy, and an Amazon "colo" costs the same as about eight of our own when spun up and serving at least a gigabit of traffic. However, the difference is less if you're going from zero sys admins to 24/7 says admins. I'd SWAG the crossover is once your AWS budget exceeds 4 full time sys admins willing to do shift work.
    - gargoiler00 13y ago
      That wouldn't address the lack of a sustainable business model. Being a forum where low wage/students/anti-corporate/anti-advertising types go and share memes is the elephant in the room problem.
      - raldi 13y ago
        Just because reddit has a lot of anticorporate types doesn't mean they don't also have a lot of pro-corporate types, too. For example, I wouldn't be surprised if the Internet's largest right-wing community turned out to be one of the subreddits.
ExpiredLink 13y ago
> Reddit's not profitable though.. Source?
- ics 13y ago
  "I confirm that reddit is not profitable." Yishan Wong, CEO [1] http://www.reddit.com/r/CrazyIdeas/comments/1i7crj/antigold_a_donation_to_charity_instead_of_reddit/cb3e9a8?context=2 http://www.reddit.com/r/CrazyIdeas/comments/1i7crj/antigold_... [2] http://blog.reddit.com/2013/08/reddit-myth-busters_6.html http://blog.reddit.com/2013/08/reddit-myth-busters_6.html
  - marvin 13y ago
    I would find it incredibly strange if reddit is never able to make money. I don't think they are really trying at the moment. Reddit is an incredibly valuable service. Maybe a lot of people on Hacker News don't see this, but reddit has basically become the Geocities of online discussion communities. The subreddit system has eliminated the "eternal september" problem, since all non-casual users will trickle into the communities that match their interests. Even if reddit loses 90% of its users, it will still be a highly relevant online community. I am certain that they can turn a (modest) profit if they really try. Reddit will probably never become a massive money machine. But regardless, it is a very influential community. Even community is arguably an understatement at this point, it is really closer to infrastructure. As I have said here before, I would be willing to bet that it is still around in 10 years, with a significant (millions) amount of users.
    - lazyjones 13y ago
      > * I don't think they are really trying at the moment.* I can - sort of - confirm they are not trying hard. Last time I tried to advertise on Reddit, I failed because they could not accept CC payments from mainland Europe ... Just think of all the ad revenue they are losing.
      - gargoiler00 13y ago
deleted 13y ago
[deleted]
brown9-2 13y ago
That doesn't mean you can't learn from it though.
RyanZAG 13y ago
Profitable is not that big a deal with something on the size and important of Reddit though. Firstly, as with Wikipedia, if Reddit were forced to close because of money issues, Reddit could simply post a 'donate now or reddit shuts down' post and they would likely be rolling in millions of dollars. Second, simply because reddit itself is not profitable does not mean people are not making a lot of money off reddit. The moderator system lends itself very well to a kind of 'corporate capture' of communities where moderators can be (and are) bought off for very tidy sums.
- gargoiler00 13y ago
  It's ironic that the alternative to advertising, is to splash big "DONATE NOW" adverts over a website.
  - dragonwriter 13y ago
    Its not the alternative to advertising (it is advertising), its the alternative to soliciting and displaying third-party advertisements.
    - gargoiler00 13y ago
      For me personally, it ends up being far more annoying. I really wish wikipedia would just put small unobtrusive text adverts on each page rather than the massive intrusive banners begging for money.
      - dragonwriter 13y ago
        There is an issue of who calls the shots -- if you solicit donations from your users, that's who you are beholden to and need to serve to get money. If you are soliciting third party advertisements, that's who you are beholden to (and if you are using a third-party ad placement service, you are beholden to them as well as, perhaps more than, the actual advertisers.)
        13y ago
jedberg 13y ago
I wrote this just above but I'll repeat it here: Funny story about that. When we were owned by Conde, the accounting was a little different (they took on some of the charges, like Akamai), and so we were actually told we were slightly profitable. When that blog post went up I was as surprised as you to see it wasn't profitable when I was there.

Reddit's not profitable though..

by OGC 13y ago

Reddit's not profitable though..

chroem 13y ago

If there is one lesson that HN needs to learn, it's that profitable is not the same thing as important.

FooBarWidget 13y ago
So they are important, but need to live off ramen every day (figuratively). What good does that do to them? I don't think grandparent should be downvoted, he raises a good point. Tons and tons of people use Reddit, but Reddit has a hard time making a living.
- cac04 13y ago
  > So they are important, but need to live off ramen every day (figuratively). What good does that do to them? Maybe they enjoy it? Maybe it makes them happy? Not everything is about money.
- hackula1 13y ago
  Power and fame are strong motivators too.
paulhauggis 13y ago
Without cash flow, how far can the site go? Someone needs to pay the bandwidth/server bill. Not to mention it costs time to run a site. If you are working full-time at another job (because you aren't bringing any money in), you won't have any time to work on it. Reddit succeeded largely because the company that bought them is making money elsewhere.
- straight_talk_2 13y ago
  >> Reddit succeeded largely because the company that bought them is making money elsewhere. Such a nonsense makes me angry. Surely you've heard about companies called Google, Facebook, Linkedin, that succeeded without being bought and for a long time not making a profit.
  - Wilya 13y ago
    The difference is Reddit isn't particularly looking for profit. Unless they completely change their business and way of doing things (unlikely to happen), they probably will never make a profit.
    - jherrick 13y ago
      Agreed. If they are re-investing money to grow the product, that might be why they aren't currently profitable. That doesn't indicate a lack of success in my book.
gargoiler00 13y ago
Look back in time. Read up on other things that had a massive userbase, but were unsustainable. Checkup alladvantage - they paid people to surf. Had millions of users, but ultimately failed because their "business model" was idiotic. Getting millions of users is pretty easy if you pay them to be a user. Someday though, it's only worthwhile if you can build a sustainable business which at least doesn't lose money hand over fist. If Reddit hadn't got bought and supported by other profitable businesses, I doubt it would have survived.
- chroem 13y ago
  That was more of a general statement than a comment specifically on reddit's position. I can make millions of dollars selling condom wrappers, but just because I have made millions of dollars does not mean that I have done something important. I may catch quite a bit of hate for this, but a large portion of HN's content is on things that make money, but are not truly important.
  - gargoiler00 13y ago
    I think the mantra from the startup community is often: 1. Make money doing whatever it takes. eg come up with some crappy website, sell it to google, then shut it down. 2. The money problem is solved! 3. Spend money solving world hunger, diseases, philanthropy. Which IMHO is pretentious BS.
- mrhazel 13y ago
  AllAdvantage was great for free money as a teenager. It only took a few minutes to slap together a VB application to move the mouse a few pixels every minute. I made a few hundred dollars from them while I slept.
  - mdellabitta 13y ago
    I guess I didn't have my act together enough as a teenager to commit fraud over the Internet while I slept.
sbierwagen 13y ago
I think that the endless stream of stories about websites shutting down and deleting all user content has made it clear to HN users that clearing a profit is pretty important.

adventured 13y ago

Reddit has an exceptionally low cost to scale ratio. Where are you getting the information that they're not profitable at this point (I know they weren't in the past)?

gargoiler00 13y ago
Last time they shared, they were spending ridiculous amounts of money on Amazon ec2 a month. Like ridiculous amounts. Someday, the money will run out, and they'll have to try and turn a profit. Their business model is fundamentally bad.
- Keyframe 13y ago
  If those outdated figures of ~$50k/month are true, I wonder if they could move to their own infrastructure or dedicated and turn some of those savings into getting from red to black.
  - Terretta 13y ago
    Yes. We operate a dozen of our own colos, with a virtual colo on AWS for insta-scalable multi-region redundancy, and an Amazon "colo" costs the same as about eight of our own when spun up and serving at least a gigabit of traffic. However, the difference is less if you're going from zero sys admins to 24/7 says admins. I'd SWAG the crossover is once your AWS budget exceeds 4 full time sys admins willing to do shift work.
  - gargoiler00 13y ago
    That wouldn't address the lack of a sustainable business model. Being a forum where low wage/students/anti-corporate/anti-advertising types go and share memes is the elephant in the room problem.
    - raldi 13y ago
      Just because reddit has a lot of anticorporate types doesn't mean they don't also have a lot of pro-corporate types, too. For example, I wouldn't be surprised if the Internet's largest right-wing community turned out to be one of the subreddits.

ExpiredLink 13y ago

> Reddit's not profitable though.. Source?

ics 13y ago
"I confirm that reddit is not profitable." Yishan Wong, CEO [1] http://www.reddit.com/r/CrazyIdeas/comments/1i7crj/antigold_a_donation_to_charity_instead_of_reddit/cb3e9a8?context=2 http://www.reddit.com/r/CrazyIdeas/comments/1i7crj/antigold_... [2] http://blog.reddit.com/2013/08/reddit-myth-busters_6.html http://blog.reddit.com/2013/08/reddit-myth-busters_6.html
- marvin 13y ago
  I would find it incredibly strange if reddit is never able to make money. I don't think they are really trying at the moment. Reddit is an incredibly valuable service. Maybe a lot of people on Hacker News don't see this, but reddit has basically become the Geocities of online discussion communities. The subreddit system has eliminated the "eternal september" problem, since all non-casual users will trickle into the communities that match their interests. Even if reddit loses 90% of its users, it will still be a highly relevant online community. I am certain that they can turn a (modest) profit if they really try. Reddit will probably never become a massive money machine. But regardless, it is a very influential community. Even community is arguably an understatement at this point, it is really closer to infrastructure. As I have said here before, I would be willing to bet that it is still around in 10 years, with a significant (millions) amount of users.
  - lazyjones 13y ago
    > * I don't think they are really trying at the moment.* I can - sort of - confirm they are not trying hard. Last time I tried to advertise on Reddit, I failed because they could not accept CC payments from mainland Europe ... Just think of all the ad revenue they are losing.
    - gargoiler00 13y ago

deleted 13y ago

[deleted]

brown9-2 13y ago

That doesn't mean you can't learn from it though.

RyanZAG 13y ago

Profitable is not that big a deal with something on the size and important of Reddit though. Firstly, as with Wikipedia, if Reddit were forced to close because of money issues, Reddit could simply post a 'donate now or reddit shuts down' post and they would likely be rolling in millions of dollars. Second, simply because reddit itself is not profitable does not mean people are not making a lot of money off reddit. The moderator system lends itself very well to a kind of 'corporate capture' of communities where moderators can be (and are) bought off for very tidy sums.

gargoiler00 13y ago
It's ironic that the alternative to advertising, is to splash big "DONATE NOW" adverts over a website.
- dragonwriter 13y ago
  Its not the alternative to advertising (it is advertising), its the alternative to soliciting and displaying third-party advertisements.
  - gargoiler00 13y ago
    For me personally, it ends up being far more annoying. I really wish wikipedia would just put small unobtrusive text adverts on each page rather than the massive intrusive banners begging for money.
    - dragonwriter 13y ago
      There is an issue of who calls the shots -- if you solicit donations from your users, that's who you are beholden to and need to serve to get money. If you are soliciting third party advertisements, that's who you are beholden to (and if you are using a third-party ad placement service, you are beholden to them as well as, perhaps more than, the actual advertisers.)
      - 13y ago

jedberg 13y ago

I wrote this just above but I'll repeat it here: Funny story about that. When we were owned by Conde, the accounting was a little different (they took on some of the charges, like Akamai), and so we were actually told we were slightly profitable. When that blog post went up I was as surprised as you to see it wasn't profitable when I was there.