Reddit IPO: OpenAI CEO Sam Altman Poised to Reap Huge Rewards
Highlights
- Reddit's first public offering may benefit Sam Altman more than others.
- Reddit disclosed its strategic interests in cryptocurrencies, mainly in Bitcoin and Ethereum, in its IPO prospectus.
- The company's IPO will be the first for a social media business in four years.
Reddit’s much-awaited IPO has sparked hopes among the users of the social media platform about its mainstream acceptance. The platform’s initial public offering will benefit a plethora of people. However, reports now point out that OpenAI CEO, Sam Altman could see huge benefits out of the listing, thanks to his stake in the company.
Sam Altman to Benefit Most Out of Reddit IPO
According to a report by Fortune, Reddit’s first public offering may benefit Sam Altman more than others. Reddit announced on Thursday that Altman holds an 8.7% stake in the firm. Altman’s stake at present makes him the third largest stakeholder.
Though the valuation for the social media platform’s IPO is currently unknown, many are speculating it to be in the billions. An example of the same is an anticipated valuation of at least $5 billion, according to Bloomberg. At present, the S-1 filing does not state how much the firm will try to sell shares for in its upcoming IPO. If the number quoted by Bloomberg turns out to be correct, it would put Altman’s investment, which is made up of 11.4 million super-voting Class B shares and 789,456 Class A shares, at around $435 million.
Sam Altman’s Reddit Investments Date Back to 2014
The Fortune report further highlights that Business Insider claims that Altman has been associated with Reddit since at least 2014. This was when he participated in the company’s Series B fundraising round. In July 2017 he also participated in the company’s Series C round, according to Axios. The company was valued at $1.8 billion at that time.
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Reddit IPO Highlights Investment in Bitcoin and Ethereum
Reddit disclosed its strategic interests in cryptocurrencies, mainly in Bitcoin and Ethereum, in its IPO prospectus. Apart from treasury-related cryptocurrency reserves, Reddit’s filing provides additional details about its broader plans. The firm plans to integrate blockchain technology across the network. The company has been looking into how blockchain technology and decentralized applications (dApps) can alter the creation, sharing, and ownership of content.
Reddit’s IPO will be the first for a social media business in four years. The most recent social media network to go public was Pinterest, which announced its IPO in 2019. Additionally, the top social media businesses are already facing a decline in ad revenue, which is lowering their market prices. The decline in revenue for social media platforms puts Reddit’s popularity at the test. Reddit’s devoted user base and the company’s viability as a business will now be determined by the decision to go public in front of investors.
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