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Reddit IPO in January

REDDIT SEEKS TO HIRE ADVISERS FOR U.S. IPO: Reddit, the operator of online message boards that became the go-to destination for day traders chasing this year’s frenzy for so-called ‘meme’ stocks, is seeking to hire investment bankers and lawyers for an initial public offering in New York, two people familiar with the matter said on Thursday.

Reddit is an American social news aggregation, web content rating, and discussion website. Registered members submit content to the site such as links, text posts, images, and videos, which are then voted up or down by other members. Online message board company preparing for initial public offering in early 2022, Reuters sources claim.

Reddit Inc, the operator of online message boards that became the go-to destination for day traders chasing this year's frenzy for so-called meme stocks, is seeking to hire investment bankers and lawyers for an initial public offering (IPO) in New York, two people familiar with the matter told Reuters on Thursday.

Reddit value was estimated at $10 billion in a private fundraising round last month. By the time the IPO launches early next year, Reddit management expects it will be valued at more than $15 billion, one of the sources told Reuters. Reddit had roughly 52 million daily active users and over 100,000 communities, or “subreddits”, as of last year, gained millions of new users earlier this year during the height of the trading frenzy Wallstreetbets, but more recent user figures have not yet been released. The San Francisco-based company saw explosive growth, however, as a result of retail investors flocking to its message boards at the start of the year for tips on trading GameStop, AMC and other meme stocks. Most Wall Street analysts deemed the meme stocks as massively over-valued, according to Reuters.

The Reuters sources cautioned that the timing and size of the IPO were subject to market conditions and asked not to be identified because the preparations are confidential. A Reddit spokesperson declined to comment.

Reddit's move to hire advisers for its IPO was previously unreported. In a recent interview with the New York Times, Chief Executive Steve Huffman had said the company was planning to go public but had not decided on the timing. The company makes most of its money through advertising. It reported $100 million in advertising revenue in the second quarter, an almost threefold jump from the same period last year.

Reddit was founded in 2005 by Huffman and entrepreneur Alexis Ohanian. It became known for its niche discussion groups, lagging the popularity of other major social media platforms such as Facebook Inc and Twitter Inc.

Reddit's biggest investors include Fidelity Investments, Andreessen Horowitz, Sequoia Capital and Tencent Holdings. Reddit was valued at $10 billion in a private fundraising round last month. By the time the IPO takes place early next year, Reddit is hoping it will be valued at more than $15 billion, one of the sources said.

Popular with retail investors, the trading app and online broker Robinhood Markets Inc (HOOD.O)capitalized on the meme stock frenzy by launching an IPO in July. Robinhood itself became a meme stock on Reddit, and its shares have risen roughly 28% since its stock market debut, so Reuters.

Reddit topped $100 million in advertising revenue for the first time in the second quarter, an almost threefold jump from the same period last year.

A Reddit representative declined to comment on the report.

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