Revival of IPO! Reddit’s stock price soars rapidly after going public, allowing long-time users on the whitelist to earn millions of dollars.
After Reddit’s IPO this year, its stock price surged by 30%. It seems that investors are not afraid of the recent market unpredictability and have shown their support for this beloved social media platform, pushing its stock price from an initial $34 to $59.80 at Monday’s close.
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Reddit’s Bull Market Benefits Long-Time Users
OpenAI CEO Sam Altman Profits from Reddit as Well
What Does Reddit’s IPO Mean for the Tech Industry?
Reddit’s stock skyrocketed by 48% during its first day of trading on the New York Stock Exchange. It not only attracted everyone’s attention but also brought substantial returns to the platform’s moderators and passionate users, collectively known as Redditors. Through a directed-share program similar to that used by Airbnb and Rivian, Reddit gave these core community members a rare opportunity to participate in the IPO and earn millions of dollars in bonuses.
One of the notable beneficiaries of Reddit’s market performance is Sam Altman, the CEO of OpenAI, who is an early investor and former board member. Altman’s stake in Reddit surged from $200 million to $613 million after the IPO, highlighting the lucrative potential of early-stage tech investments.
The IPO frenzy surrounding Reddit aligns with Astera Labs’ 72% stock price increase during its initial public offering on Nasdaq, reigniting people’s interest in the IPO market. Reddit’s successful public debut, as the first major IPO from a social media entity since Pinterest in 2019, is closely watched as a future tech IPO indicator, especially in a market concerned about rising interest rates and inflation.
Lo Toney, Founding Managing Partner of Plexo Capital and Reddit shareholder, believes that Reddit’s IPO is a ray of hope for the entire tech industry. According to Toney, strong investor interest was observed during Reddit’s roadshow, indicating that the market is ready for more tech companies to go public. However, he cautioned that several more successful cases are needed before announcing a full IPO revival.
Despite the excitement, Toney also pointed out future challenges, including the disparity between private market valuations and public market expectations. For Reddit, its valuation was $10 billion in its last round of private fundraising in 2021, while its IPO valuation was adjusted to approximately $6.5 billion, highlighting the complexity of transitioning from the private market to the public market.
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Reddit Applies for IPO, Holds BTC and ETH, Sam Altman is also an Investor
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IPO
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Further reading:
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