In other news, Microsoft is reportedly avoiding big antitrust lawsuits by innovatively not acquiring companies outright. Instead, it is hiring away founders and staff from companies like Inflection, an AI foundation model company, and paying the remaining company to keep its investors satisfied. This strategy allows Microsoft to gain what it needs from potential rivals without facing antitrust review. However, this approach is raising concerns about transparency and the potential for dangerous precedents.
Key takeaways:
- The tech IPO market is showing signs of revival with Reddit's successful IPO, which followed semiconductor maker Astera Labs' strong debut. Reddit's shares were priced at $34 and saw a significant first-day increase, opening at $47 and closing at $50.44.
- Reddit's journey to IPO has been marked by numerous investors, corporate drama, and a strong connection to startup incubator Y Combinator. Reddit was the first YC company, and many of its batch-mates from the original 2005 class have crossed paths with the company since.
- Despite being a pioneer of social media, Reddit has faced challenges in monetizing its user base. The company has gone through several CEOs before current CEO Steve Huffman took over in 2015. Huffman has faced criticism but has sought to reward the site's most active community members and moderators by allowing them to buy stock at the offering price.
- Microsoft is innovatively avoiding big antitrust lawsuits by pioneering the non-acquisition acquisition. It recently hired away the founders and staff of AI foundation model company Inflection, paying the remaining company $650 million. This move follows a similar partnership with OpenAI, with Microsoft holding a 49% stake in the company.