Reddit Pulls Down a Double-Double

Image Credit: Getty Images, Kelvin Cheng.

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This orange envelope came stuffed with a bundle of cash.

Reddit will double its headcount to 1,400 after doubling its valuation to $6 billion. A $250 million funding round led by Vy Capital will support the hiring spree.

The news comes hot on the heels of the GameStop saga, which was unleashed on the world by the site’s r/WallStreetBets subreddit.

Five Second Spending Spree

Reddit bought the shortest ad spot in Super Bowl history, which ran a text message for five seconds during Sunday’s big game. “One thing we learned from our communities last week is that underdogs can accomplish just about anything when they come together around a common idea,” it read, in a nod to the WallStreetBets shenanigans. It didn’t note that this particular common idea is now under investigation by the SEC, oops.

  • In terms of users, Reddit pales in comparison to the big social media sites. It has 52 million daily active users, while Facebook has 1.85 billion, Snap has 265 million, and Twitter 187 million.
  • Reddit’s user base did grow 44 per cent from December 2019 to December 2020, which CEO Steve Huffman said has led to an influx of new advertisers. Direct advertising revenue, the company said, was up 90 percent last quarter.
  • Reddit was sold to Conde Nast in 2006, and then spun off in 2011. It’s raised $800 million since, but is still unprofitable.

Did Reddit Have the Tesla Scoop?: Buried in the vast reaches of Reddit’s different forums are posts from all kinds of variously reliable sources, which can create information chaos or affirm the democratic principles of the open internet depending on your view. One thing’s for sure: there are always hidden gems. Users are now wondering whether a January post by someone claiming to be a Tesla employee broke the news that the company was making massive Bitcoin purchases. This week, the company disclosed it had taken on $1.5 billion in the cryptocurrency.

The Takeaway:

Dwarfed by the other social giants in size, Reddit seems almost guaranteed to continue to punch above its weight in mischief.