Reddit will raise nearly $750 million in its upcoming IPO

Reddit aims to raise up to $748 million as part of its upcoming IPO, in which the social media company is seeking a valuation of around $6.5 billion.

The company plans to sell about 22 million shares in the range of $31 to $34 per share, according to corporate filing released on Monday.

Reddit has also set aside approximately 1.76 million shares for certain users and moderators, known as Redditors, who want to participate in the initial public offering and have created their user accounts before January 1. These Redditors will be able to buy those shares and then sell them when Reddit goes public because they won’t be subject to a lock-up period that typically prevents investors from selling shares for six months after an IPO.

The company warned in its S-1 filing that Redditors participating in its IPO “may result in increased volatility in the market price” of the company’s Class A common stock. Other companies that have gone public and allowed certain community members and others to participate in their IPOs through similar directed equity programs include Doximity, Rivian, and Airbnb.

Reddit filed its IPO prospectus in February and said it plans to go public on the New York Stock Exchange and trade under the symbol “RDDT.”

Investors are closely watching Reddit’s upcoming IPO, which will be the first major tech stock launch this year and the first social media IPO since Pinterest went public in 2019.

In 2021, Reddit filed a confidential draft of its public offering prospectus with the Securities and Exchange Commission. That year, Reddit raised $1.3 billion in a funding round and had a private market valuation of $10 billion, according to deal-tracking service PitchBook.

Reddit’s annual sales in 2023 were $804 million, up 20% year over year from $666.7 million, according to the company’s S-1 filing. It also posted a net loss of $90.8 million for 2023, down from the $158.6 million net loss recorded in 2022.

Some of the company’s notable shareholders include Tencent, the parent company of Condé Nast Advance Magazine Publishers, and OpenAI CEO Sam Altman, who served on Reddit’s board of directors from 2015 to 2022.