Reddit

Reddit operates a network of topic-based online communities, called subreddits, where users post links, text, images and video and vote content up or down. It earns most of its revenue from advertising and also licenses its data. Reddit was founded in June 2005 by University of Virginia roommates Steve Huffman and Alexis Ohanian, who were in Y Combinator's first class; Aaron Swartz joined that November. Huffman is CEO, and the company is headquartered in San Francisco.

Y Combinator provided Reddit's first funding. Conde Nast Publications bought the site in October 2006 for a reported $10 million to $20 million, and in September 2011 Reddit became an operationally independent subsidiary of Advance Publications, Conde Nast's parent. As an independent company it raised a $50 million round in 2014, and in 2017 it raised $200 million at a $1.8 billion valuation from investors including Andreessen Horowitz, Sequoia Capital, Sam Altman and SV Angel. In February 2019 Tencent invested $150 million. In 2021 Reddit sold Series E stock at $42.47 a share to Advance, Tencent, entities affiliated with Sam Altman and others, and by August 2021 it was valued at more than $10 billion after a $410 million round. Its IPO prospectus lists funds managed by FMR (Fidelity) as a holder of more than 5 percent, alongside Advance, Tencent and Altman-affiliated entities.

Reddit priced its IPO on the New York Stock Exchange in March 2024 at $34 a share under the ticker RDDT. About 22 million shares were offered, of which the company sold roughly 15 million to raise up to $519 million and selling holders sold the rest; it reserved 8 percent of the offering for users, moderators and others through a directed share program. Advance remained the principal stockholder. Reddit did not begin meaningful monetization until 2018. For 2025 it reported revenue of $2.2 billion, up 69 percent, gross margin of 91.2 percent, net income of $529.7 million and 121.4 million daily active uniques in the fourth quarter.

Reddit shows how long a consumer network can take to reach liquidity. Y Combinator's seed check in 2005 was followed by a sale to a media company within 18 months, a spin-out five years later, and nearly 13 more years of private venture and strategic funding before the 2024 listing. Investors who entered through the 2014 to 2021 rounds, including Andreessen Horowitz, Sequoia, Tencent and Fidelity, paid valuations from about $1.8 billion to more than $10 billion, and by 2025, its second full year as a public company, it reported net income of $529.7 million.