Isn't that why Apollo said they'd sell the company for $10M to Reddit if they wanted to take it over? If it costs Reddit $20M/year, surely they could make more than $10M/year if they took it over themselves.
Well a) the Apollo team is two people and b) why would they? Reddit’s priority is monetization. Acquiring/hiring the Apollo team doesn’t help that goal.
Then Reddit the company should charge Apollo a reasonable price, not an extortionate price that will kill the apps altogether. And lay off the majority of the staff, just like Twitter. Sure, the experience may get slightly worse, but it will be fine. The real issue is just trying to take Reddit to IPO.
I think a more natural move would be to IPO. Since Steve Huffman stated that monetization is not a top priority, it won't be happening anytime soon.
Fun fact : they sold reddit in it's infancy and then later regained control. That sale didn't end well. Even if they do find a more savvy buyer like FB/Google , reduced founder control in a community driven website can't be a good thing. Having spent billions to acquire reddit, the new owner will likely begin to turn it into an advertising machine which has the potential to alienate the core userbase. On reddit, the core userbase is everything.
> In 2023, the company’s revenue was $804.0 million. Research and development, at $438.3 million, was more than half, an awfully big number for a company of this age. Total costs and expenses were $944.2 million. The net loss was $90.8 million, which at least is an improvement over 2022, with its $666.7 million in revenue and $158.6 million in losses. [1]
These expenditures blow my mind. But if reddit can grow revenue to 1200m and cuts expenses to 300m, the story looks totally different. A turnaround like that might only take a couple of years. Reddit is an incredibly sticky product, just badly mismanaged. With some new management, it could even be a buy at 5bn.
> It sold for a lot, suddenly the new owners are eager to get returns on that investment.
Reddit launched in June 2005, sold to Condé Nast in October 2006, and was spun off as an independent company with Advanced Publications (Condé Nast's parent) maintaining a majority interest in 2011. So it's only actually been sold once, back in 2006, and that was not for a lot of money -- under $20M. Maybe there's a billion dollar exit in the company's future, but there definitely hasn't been one in its past.
(N.B.: I doubt there's one in its future, either.)
It's still very unclear what exactly right it would be buying with that $10 million. Instead of Apollo shutting itself down right it would pay for the privilege of being the one to shut it down? The payment doesn't make any sense and doesn't help Reddit offset the losses in any way.
The Proposal was to have reddit by Apollo and monetize it, all the talk about going quiet doesn't make sense.
they sure had a good trajectory before huffman fucked that up and bought moonshot projects and hired 2,000 employees and did everything possible to mess up that trajectory so they could pump and dump for an ipo.
Most likely scenario is spez’s boss wanted better numbers to maximize price at IPO.
I think they decided to cash out when things were very frothy in 2021, and they missed the window. It will be interesting to see if they even get to $10B. I would bet on less than $5B.
According to Wikipedia:
>In October 2014, Reddit raised $50 million in a funding round led by Sam Altman and including investors Marc Andreessen, Peter Thiel, Ron Conway, Snoop Dogg, and Jared Leto.[13] Their investment valued the company at $500 million at the time.[14][15] In July 2017, Reddit raised $200 million for a $1.8 billion valuation, with Advance Publications remaining the majority stakeholder.[16] In February 2019, a $300 million funding round led by Tencent brought the company's valuation to $3 billion.[17] In August 2021, a $700 million funding round led by Fidelity Investments raised that valuation to over $10 billion.[18] The company then reportedly filed for an IPO in December 2021 with a valuation of $15 billion.[19][20]
> But in the startup world it’s make profit, sell, or shut down
In the startup world 90% of companies are shut down because their ideas are not viable. If reddit still isn't viable after 18 years it might be time to pull the plug and move back to something sustainable.
> or be owned by Meta
I voted for kodos
> or 10 companies
Would that be the total number of companies that could pay the money reddit wants for API access?
>If the steps Reddit takes to try to make a big return on investment anger those communities,
Yes, but that won't happen. They've been incredibly hands-off for the past 7 years. They basically worked their asses off on too few engineers for years, and during all that time kept showing almost no ads, and if they did they did it on the far right where almost no one notices.
Just because they're raising capital now, doesn't mean they'll go out and fuck it up. Whatever outside money they take on, they'll be extremely conscientious about retaining control or their future stakeholders sharing their values.
They claim that they would.
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