Watch: Reddit's IPO success may hinge on AI boom | TechCrunch
Mar 12, 2024 - techcrunch.com
Reddit's upcoming public debut could potentially end the long-standing lack of IPOs. The company's valuation has significantly increased during the pandemic, and it is now striving to maintain as much of its final private-market price in its public offering. Despite its unprofitability, Reddit's large size, with over $800 million in revenue last year, and its growth story are attractive to investors. The vast amount of text and memes generated daily by Reddit users is valuable to the company, especially for AI companies needing data for model training.
The success of Reddit's IPO could potentially open up more opportunities for public offerings. However, there's also a risk that the public offering could fail. Nevertheless, with a growth story that is appealing to AI companies, Reddit's move towards the public markets could be well-timed.
Key takeaways:
The long-standing lack of IPOs may be ending, partly due to Reddit's upcoming public debut.
Despite its continued unprofitability, Reddit's valuation has soared during the pandemic and it generated more than $800 million in revenue last year.
The company's user-generated content is valuable for AI companies needing data to train their models, making Reddit a growth story that investors love.
If Reddit's IPO does well, it could potentially open the public-offering window wider than it has been in recent quarters.
