In Its IPO, Reddit Will Reserve Shares For Big Users

(CTN News) – A report in the Wall Street Journal reported on Wednesday that social media platform Reddit plans to sell a portion of the shares it is offering in its initial public offering to its users.

The company plans to have an undetermined number of shares reserved for 75,000 of its most prolific so-called Redditor members when it goes public next month, according to the report, which cited sources familiar with the matter.

Users will be able to purchase Reddit shares at the IPO price before the stock begins trading, a privilege that is usually reserved for large investors and is usually restricted to users with deep pockets who can afford the shares.

As of the time of our deadline, the company has not responded to Reuters’ request for comment about the funding round held in 2021 which valued the company at about $10 billion.

As reported in January by Reuters, Reddit has drawn up detailed plans for its IPO in March and has started working on them since November. Back in December 2021, the company had filed a confidential application for its initial public offering.

As of right now, the IPO market is not fully recovered since it has been struggling for the past two years with low volumes while a number of new entrants are trading below the IPO prices at the time of their IPO.

Since Pinterest’s (PINS.N) IPO in 2019, which was the first major social media company to release an IPO since that of Reddit (REDD.OT), Reddit’s IPO would be the first from a huge social media company in three years.

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