Reddit IPO Alert: 10 Things for Potential Reddit Stock Investors to Know

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Reddit, the operator of online message boards, has filed confidentially for an initial public offering.

reddit social network logo on mobile phone screen.

Source: ilikeyellow / Shutterstock.com

If you want to buy Reddit stock, what do you need to know? Unfortunately, because the company has filed confidentially, we do not know details like its execution date, pricing, ticker symbol or the amount of shares it plans to offer.

What we do know is that Reddit is planning its IPO for the first half of 2022. We also know that it is highly anticipated given the size of the company and its popularity among retail traders who frequent the r/WallStreetBets subreddit. These investors turned to r/WSB as a hub to launch short squeezes of GameStop (NYSE:GME) and AMC Entertainment (NYSE:AMC).

Beyond these basics details, here’s what else we know so far about the upcoming Reddit IPO.

10 Things to Know About the Reddit IPO

  1. Reddit is aiming for a valuation of more than $15 billion from listing its shares on a stock exchange.
  2. As meme stocks skyrocketed in early 2021, Reddit saw its valuation double to $6 billion.
  3. More recently, Reddit was valued at $10 billion in a private fundraising round that took place in August.
  4. Where does this growth come from? Well, Reddit has over 50 million active daily users and more than 100,000 subreddits.
  5. Additionally, the San Francisco-based company reported $100 million in advertising revenue in the second quarter. That is a massive jump year over year.
  6. Plus, Reddit has received backing from several prominent investors. Over the years these have included Andreessen Horowitz, Sequoia Capital, and rapper Snoop Dogg.
  7. This comes after its founding in 2015, by Steve Huffman and Alexis Ohanian.
  8. Now, after great growth, Reddit plans to double its staff by the end of this year to 1,400 employees.
  9. Why the Reddit IPO really is gaining prominence comes back to the short squeezes. Earlier this year, retail traders drove outsized gains in highly shorted shares of companies such as GameStop and AMC.
  10. There, r/WallStreetBets users are already talking about potentially pumping up the Reddit stock IPO when it happens.

On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.


Article printed from InvestorPlace Media, https://investorplace.com/2021/12/reddit-ipo-alert-10-things-for-potential-reddit-stock-investors-to-know/.

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