The company set aside around 1.76 million (out of 15.5 million) shares for its users in the IPO.
Social media platform Reddit (RDDT), which made its debut on the New York Stock Exchange (NSE) on Thursday, debuted at $47 per share. The company had kept its price at $34 per share, while the share closed at $50.44 per share. This was a 48 per cent jump from the IPO price.
After the company began trading, investors valued the company at close to $9 billion, according to the AP. This was one of the biggest IPOs of a social media platform, reports the BBC.
Reddit intends to raise $748 million through the IPO. The interest in Reddit lies in its loyal user base. The platform provides a free space where audiences can discuss anything, starting from gaming, business, sports, life-related queries, and literally anything. No wonder it has the tagline, “Dive into Anything.”
Users are even discussing the IPO on the platform, with one user with the user name r/OutOfTheLoop asking, “What's going on with Reddit's IPO that came into effect today? I don't understand stocks well; are they selling the website? What will change?”
Many users are pretty skeptical of the IPO. One user with the user name AuthorNathanHGreen wrote on Reddit, “Reddit has never turned a profit, and the only way I see it starting to make money would involve degrading the user experience directly and significantly (and it already has a pretty marginal user experience).”
As per a regulatory disclosure, the platform had around 76 million users in December. Simultaneously, the company set aside around 1.76 million (out of 15.5 million) shares for its users in the IPO.
Despite its broad base, the company never made a profit. In December, when the company was filing for IPO, it had a cumulative loss of $467 million.