Exclusive: Reddit Seeks To Hire IPO Advisors In US -sources

Sep 2 (Reuters) – Reddit Inc, the online bulletin board operator that has become the go-to destination for day traders looking for this year’s frenzy for so-called ‘meme’ stocks, is looking to hire bankers investment and lawyers for a first public (IPO) in New York, said Thursday two people familiar with the matter.

Reddit was valued at $ 10 billion in a private fundraiser last month. By the time the IPO takes place early next year, Reddit is hoping it will be valued at over $ 15 billion, one of the sources said. Read more

The sources warned that the timing and size of the IPO was subject to market conditions and asked not to be identified as preparations are confidential. A Reddit spokesperson declined to comment.

Reddit’s decision to hire advisers for its IPO has not been reported before, but there has been significant speculation in recent months about the company’s IPO plans, after years of stay private. In a recent interview with The New York Times, chief executive Steve Huffman said the company was planning to go public but had not decided on when.

Reddit was founded in 2005 by Huffman, entrepreneur and investor Alexis Ohanian, and late internet activist Aaron Swartz. It has become known for its niche newsgroups, lagging behind the popularity of other major social media platforms such as Facebook Inc (FB.O) and Twitter Inc (TWTR.N).

However, the San Francisco-based company has seen explosive growth, as retail investors flocked to its message boards earlier this year for trading advice from GameStop Corp (GME.N) and ‘other actions memes. Most Wall Street analysts felt that memes stocks were massively overvalued. Read more

Reddit had around 52 million daily active users and more than 100,000 communities, or “subreddit”, as of October of last year. Huffman said he gained millions of new users earlier this year at the height of the trading frenzy, but the most recent user numbers have yet to be released.

The company derives most of its money from advertising. It reported $ 100 million in advertising revenue in the second quarter, an almost three-fold jump from the same period last year.

The biggest investors in Reddit are Fidelity Investments, Andreessen Horowitz, Sequoia Capital and Tencent Holdings.

Reporting by Anirban Sen in Bengaluru Additional reporting by Echo Wang in New York Editing by Rosalba O’Brien

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