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Reddit disclosed further details of what is set to be one of the year’s biggest IPOs, with the company and some existing shareholders seeking to raise as much as $748 million.
Reddit and the holders are planning to sell 22 million shares for $31 to $34 each, the social media platform said in a filing on Monday. About 15.3 million of those shares will be sold by the company and the rest by the investors, who are Reddit employees.
At the top of that range, Reddit – whose users helped create the meme stock frenzy of 2021 – would have a market value of $5.4 billion, based on an expected nearly 159 million shares outstanding.Fully diluted to include employee stock options and restricted share units, its valuation would be about $6.4 billion, the filing with the US SEC shows.
About 8% of the shares in the IPO are being set aside for Reddit users and moderators who created accounts before Jan 1, as well as some board members and friends & family of some employees and directors. Those shares won’t be subject to a lock-up, meaning the owners can sell them on the opening day of trading, according to Reddit’s filing.
Reddit’s more than two-year slog to listing reflects the ups and downs of the market, beginning with its initial confidential filing in 2021. Reddit raised funds that year valuing it at $10 billion. Founded in 2005, Reddit averaged 73.1 million daily active unique visitors in the fourth quarter. The company reported a net loss of $91 million on revenue of $804 million in 2023. Reddit’s largest shareholder is Advance Magazine Publishers, part of the Newhouse family publishing empire that owns Conde Nast, which bought Reddit in 2006 and spun it out in 2011.
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