Reddit pushes stock market plans forward Reactions to Tesla vote in Germany: “That would be a catastrophe”

The online platform Reddit is taking the next step on its way to the stock exchange. The San Francisco company published its prospectus on Thursday – two years after it initially filed its confidential filing with the Securities and Exchange Commission (SEC).

This tells us, among other things, that Reddit was able to increase revenue and limit losses last year.

On Reddit, users can join online groups based on their interests. In the past quarter, the platform averaged 73.1 million daily users. About half of that came from the US. Registered US users spent an average of 25 to 30 minutes per day on Reddit, it was also reported.

Many users exclusively on the platform

As for the advertising industry, the agency emphasizes that much of it cannot be found on other online services. Nearly a third of American Reddit users are not active on Facebook, 73 percent are not active on Snapchat and 53 percent are not active on Elon Musk’s Twitter successor X.

Reddit will also allow some particularly active users to buy shares in the IPO – which is unusual. Unlike many other investors, they are not required to hold their securities for a certain period of time before selling them. In the current version of the stock exchange prospectus, there was no information about what part of the shares for sale should go to users.

Allocation of shares based on activity level

What is known so far is that some users and moderators of Reddit’s online groups will receive an offer to participate in the IPO. The shares are then allocated based on the so-called ‘Karma’ rating, which reflects the reputation and activity of users on the platform.

In the usual risk warnings in the prospectus, Reddit also noted that user participation after the IPO could lead to large price swings. Users on the platform formed the movement in 2021, investing in shares of some Wall Street questionable companies, such as video game store chain Gamestop, causing prices to rise.

Reddit increased revenue last year from $666.7 to $804 million. The loss fell from $158.6 million to $90.8 million. Reddit initially provided no information about the target valuation or volume of the stock placement. According to information from the financial service Bloomberg, Reddit was recommended a valuation of around five billion dollars. (sda/dpa)