Reddit plans to raise up to $748 million in an upcoming IPO, with the social media company seeking a valuation of about $6.5 billion.
The company plans to sell about 22 million shares at $31 to $34 each, according to one company. Company filing Published Monday.
Reddit has also set aside about 1.76 million shares for certain users and moderators, known as Redditors, who want to participate in the IPO and have created user accounts before Jan. 1. These Reddit users will be able to buy the shares and then sell them when Reddit goes public because they are not subject to a lockup period, which typically prevents investors from selling shares within six months of an IPO.
company warn In its S-1 filing, Reddit users participating in its IPO “may cause increased market price volatility in the company’s Class A common stock.” Other companies that have gone public and allowed certain community members and others to participate in their IPOs through similar directed stock programs include Doximity, Rivian and Airbnb.
Reddit submitted an IPO prospectus in February and said it planned to list on the New York Stock Exchange under the stock code “RDDT.”
Investors are paying close attention to Reddit’s upcoming IPO, which will be the first major technology stock offering this year and the first social media IPO since Pinterest went public in 2019.
In 2021, Reddit filed a confidential draft prospectus for a public offering with the SEC. That same year, Reddit raised $1.3 billion in a funding round that gave it a private market valuation of $10 billion, according to deal tracking service PitchBook.
According to the company’s S-1 filing, Reddit’s annual sales in 2023 will be $804 million, a 20% increase from $666.7 million in the same period last year. It also recorded a net loss of $90.8 million in 2023, narrowing from a net loss of $158.6 million in 2022.
Some of the company’s notable shareholders include Tencent, Condé Nast parent company Advance Magazine Publishers, and OpenAI CEO Sam Altman (who served on Reddit’s board of directors from 2015 to 2022).
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