Reddit raises $410 million in new funding.
Reddit, the virtual town of the mainstream Internet, has raised $ 410 million in new funding, valuing it at more than $ 10 billion, the company said Thursday.
The funding, led by Fidelity Investments, increases Reddit’s valuation from the $ 6 billion it reached six months ago, when it raised $ 250 million. Reddit said it expects existing investors to participate in the latest funding as well, so the round is likely to grow and close at around $ 700 million.
The latest funding wasn’t planned, but “Fidelity made us an offer we couldn’t refuse,” Steve Huffman, co-founder and CEO of Reddit, said in an interview.
The company then decided that the capital would give it more time to decide when and how to go public. “We’re still planning to go public, but we don’t have a specific timeline just yet,” Huffman said. “All good companies should go public when they can. “
The move gives Reddit more of a war chest to grow its business and attract new users. The company earns most of its money from the sale of advertisements, which appear in the feeds of users who browse the many “subreddits” or thematic forums on the site.
But Reddit has to compete with digital advertising giants like Google, Facebook, and Amazon, along with other ad-based social media sites including Twitter, Snap, and Pinterest.
“We grew up in the shadow of Facebook and Google, and just about every dollar we earn has had to fight,” Huffman said.
Still, he said, the company’s advertising products have started to perform better. Reddit surpassed $ 100 million in single-quarter revenue for the first time this year, up 192% from the same period in 2020.
Over 50 million people now visit Reddit daily, and the site has over 100,000 active subreddits. While he previously had a laissez-faire approach to free speech, however toxic it may be, Mr. Huffman has spent the last few years revising Reddit policies and making it harder for trolls to invade them. forums.
The company will use the new funds to improve product functionality, focusing on how to make it easier for newcomers to explore and understand the site quickly, Huffman said. Reddit is also improving its video products for more advertising. And the company is building its self-service advertising system, which could help attract marketers from small and medium businesses.
Reddit is also focusing on its international expansion. Most of the site is US-centric, Huffman said – something he hopes to change.
“The first priority of the product is just to make Reddit great,” he said. “We want to create what is best for new users, because over time it will be best for everyone. “
#Reddit #raises #million #funding