Reddit confidentially files to go public

Social media company hopes for valuation of more than $15bn by the time IPO takes place

Social media platform Reddit said that it has confidentially submitted a draft registration with the US Securities and Exchange Commission to go public on Wall Street. AFP

Reddit, known for its message boards that became the go-to destination for day traders during this year's meme stock frenzy, said on Wednesday it had confidentially filed for an initial public offering with US securities regulators.

Founded in 2005 by Steve Huffman and entrepreneur Alexis Ohanian, Reddit was valued at $10 billion in a private fund-raising round this year.

Reuters reported in September that the company was hoping for a more than $15bn valuation by the time an IPO takes place.

The filing comes as US IPOs touched record highs in 2021, fuelled by ample liquidity due to accommodative monetary policies. Robinhood Markets, Coupang and Coinbase Global are some of the companies that launched IPOs in the US this year.

Reddit had about 52 million daily active users and more than 100,000 communities, or “sub-reddits”, as of October last year.

The company saw major growth as a result of retail investors flocking to its message boards at the start of the year for tips on trading GameStop and other so-called meme stocks.

San Francisco-based Reddit reported $100 million in advertising revenue in the second quarter, an almost threefold jump from the same period last year.

In March, the company hired Drew Vollero — who, as the first finance chief of Snap, guided its transition to a public company — as its first chief financial officer.

The company's biggest investors include Fidelity Investments, Andreessen Horowitz, Sequoia Capital and Tencent Holdings.

Reddit did not disclose the number of shares to be offered or the price range of the IPO in the draft registration statement with the US Securities and Exchange Commission.