Reddit Faces Uphill Battle to Profitability in Risky IPO
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Reddit has never been profitable, despite being founded in 2005, and its S-1 filing reveals longer risk factors than Twitter's and Facebook's combined.
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Many Reddit users are pessimistic about the IPO, seeing it as "the beginning of the end" and planning to short the stock.
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Reddit is vulnerable to its users and moderators, who provide free labor, so the directed share program to give them early access to shares could be a tactic to incentivize good behavior.
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Reddit has failed at several attempts to monetize through blockchain initiatives like selling NFTs and Community Points.
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CEO Steve Huffman is disliked by many users, faces criticism for bizarre decisions like raising prices because "Elon Musk did it," and is listed as a risk factor himself in the S-1.