Social media site Reddit is giving an opportunity for its users to be able to buy a piece of the company but not everyone is up for it.
Some of the moderators and power users who learned that they get a rare chance to buy IPO shares at the same price as the investors said that they have a small interest in buying these shares from their company.
Even though the said opportunity is being extended to those who have already invested their time on the site like longtime commenters and volunteer moderators who spent their time helping the site without being paid, these users are questioning the prospect of the company.
The 18-year-old business has not made any profit and lost $91 million last 2023.
The cold reception from Reddit users could somehow sabotage the ambition of the company’s CEO and cofounder Steve Huffman, who has mentioned that he would like to see contributors to the community become owners. This could also affect the prices when the RDDT ticker debuts on the New York Stock Exchange which could generate less profit for Reddit and investors who have given $1.2 billion over the past decade.
These types of IPO buy-ins are usually reserved for huge investors like retirement funds for example that hold shares for a long time.
Previous employees from the company who have worked on the IPO preparations said that the resentment from other moderators abroad has been a long-time pitfall to the plan. Staff also said to the executives that they think many moderators would be afraid of buying in and worry that it would ruin their volunteer work.
Reddit has not made an announcement yet regarding how many shares it will reserve for users but it will be in a limited number. The first in line will be significant contributors who are measured through joining the company advisory boards or having high karma. Said the first tier involves some of the busiest moderators who make discussion forums and create rules for contributing to them.
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