Reddit's Potential investors reportedly want the company to target an IPO valuation of $5 billion.
This is according to a report by Bloomberg News on Sunday (January 28), citing sources familiar with the discussions surrounding the social media platforms planned IPO (Initial public offering).
In an email to PYMNTS on Sunday, Reddit declined to comment.
According to these sources, Reddit is considering feedback from meetings with potential IPO backers, with the company and its advisers aiming for a valuation in the mid-single-digit billion range, with the final figure depending on the recovery of the IPO market.
The report said that private trades in unlisted Reddit shares have valued the company at less than $5 billion, and argued that such trades could indicate a lower valuation than a company might achieve in its IPO, as private stocks tend to be “relatively illiquid”.
PYMNTS reached out to Reddit for comment but has not yet heard back.
The news follows reports earlier this month that Reddit planned to go public in March, a move that would make it the first social media company to do so since Pinterest in 2018.
Reddit confidentially filed to go public in 2021, although the “listing was later postponed due to failure to achieve profitability at that time,” PYMNTS wrote in November, as reports of a Possible IPO resurfaced.
Reddit was founded in 2005 and is one of the most popular social media platforms. Reddit became a household name when one of its subreddits, WallStreetBets, played a central role in the emergence of a form of stock market investing known as meme stocks.
Reddit's IPO plans come as a number of other well-known companies are also making their own plans to go public. For example, a stablecoin issuer Circle Filed earlier this month Paperwork for an IPO with the Securities and Exchange Commission.
The company had originally planned to go public in 2022 via a $9 billion special purpose acquisition company (SPAC) merger The plan was shortened due to a delay in the approval of its S-4 registration statement by the SEC.
Now a fast fashion brand Shein is seeking approval from regulators in China for an initial public offering in the United States, a process that could hinder the company's plans to go public.
And Sebastian Siemiatkowski, CEO of the Swedish FinTech Klarnasaid last week it was “very likely” that the company would list in the USA
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