Reddit files for IPO confidentially

Reddit Inc. said it has confidentially filed paperwork for the initial public offering with the US Securities and Exchange Commission, an announcement that comes at the end of a banner year for its stock-market debut.

The company said in a blog post that it had begun paperwork with the SEC but did not share any further details.

“The number of shares to be offered and the price range for the proposed offering have not yet been determined,” the post said. The initial public offering is expected to occur after the SEC completes its review process, subject to market and other conditions.”

As of August, Reddit said it had a valuation of about $10 billion after raising more than $400 million from Fidelity Investments Inc. In February, the social-media company said it had raised nearly $500 million at a valuation of $6.5 billion.

Reddit is looking to build on that attention when its WallStreetBets forum GameStop Corp. And became a hot spot for individual investors rallying around other stocks.

The episode brought in millions of new users, Reddit chief executive Steve Huffman said in its wake, as well as new advertisers, the source of the bulk of the company’s revenue. He has also said that with an IPO, he wants to make Reddit’s stock offering more accessible to individual investors.

San Francisco-based Reddit, founded in 2005, is known for its message boards on a range of topics, as well as its “Ask Me Anything” digital town hall with celebrities, politicians and subject matter experts. The company was sold to Condé Nast in 2006, and the magazine publisher’s parent, Advance Publications Inc., spun off Reddit in 2011 and remains a shareholder.

Over time Reddit has evolved to outperform rivals like Digg by becoming a haven for niche communities to gather and source news. According to its website, Reddit had more than 50 million daily users as of January. In August the company said it reached $100 million in advertising revenue in a quarter for the first time, nearly three times the prior-year figure, but remained unprofitable.

Reddit’s market debut will be a year later for an IPO like no other. More than 900 companies have gone public, raising nearly $300 billion in 2021, including electric vehicle maker Rivian Automotive Inc., dating app Bumble Inc. and mobile-videogame maker Playtica Holding Corp.

Along with Fidelity, Reddit’s investors include venture-capital firms Andreessen Horowitz and Sequoia Capital, and Chinese technology conglomerate Tencent Holdings Ltd.

In recent years, Reddit has been taking steps to grow by investing in areas such as video and consumer products, as well as entering international markets. But like many other social-media companies, it also suffers from content-restraint challenges, including how to curb the spread of misinformation and calls for violence.

In 2020, Reddit banned “The_Donald”, a community dedicated to former President Donald Trump, saying that moderators often overlook content that violates its platform’s rules.

Thanks to the Gamestop trading frenzy, Reddit has become a hotspot for Wall Street investors seeking advice this year. At the Wall Street Journal’s Tech Live conference in October, Huffman said he was expecting a lot of individual investors to participate in Reddit’s initial offering.

“Retail investors are usually on the last and probably worst price for a final offering. But with the way the market is getting more fair, I think it’s really exciting,” Mr. Huffman said at the event.

This story has been published without modification in text from a wire agency feed