SAN FRANCISCO – Reddit announced on Monday that it has raised $ 250 million in new funding, which values the compilation of social news at $ 6 billion as intended. to turbocharge the growth of users and double its workforce.
The investment is a shot in the arm for Reddit, which since 2003 has focused on building digital communities around topic-based message boards. The latest financing, led by Vy Capital with the participation of previous investors such as Andreessen Horowitz, Sequoia Capital and Tencent Holdings, doubles Reddit’s valuation of its last financing in 2019.
Headquartered in San Francisco, Reddit said the funding was built on the success of its growing advertising business as brands and marketers were attracted to the powerful and active members of the site.
“We have come a long way in recent years to focus more on the needs of the hundreds of thousands of communities that make up Reddit,” the company said in a blog post. “We have dedicated ourselves to Reddit because we believe in the power of communities that offer a sense of belonging and commitment, just like the ones we make offline.”
Reddit has been very visible in recent days. Last month, shares of video game retailer GameStop skyrocketed when users of Reddit’s WallStreetBets forum, known as a ‘subreddit’, called on each other to buy the stock, partly to capture hedge funds. who bet the stock would fall.
This sent GameStop’s inventory on an extraordinary and volatile ride. After a flurry of media attention, the WallStreetBets forum has balanced to more than seven million members. Over the saga, several rights were bought for books and films, with the prospect of fame and money entangling the moderators of the forum in bitter disputes.
Reddit was also widely praised for a five-second ad that aired Sunday during the Super Bowl, which became one of the most-discussed ads on a day full of discussed ads. Reddit’s site, which required viewers to interrupt their television screens to read it, exclaimed, “Wow, that actually worked.” Viewers scrambled to take screenshots of one of the shortest Super Bowl ads ever posted on social media.
Reddit has had its controversy over the years. The company has long been criticized for its laissez faire approach to content moderation, which has allowed racist, sexist and troll-filled communities to flourish. At one point, Reddit refused to remove subforums dedicated to racist comments, citing the need for free and unhindered speech.
Over the past few years, the company has changed its tune on content moderation. Since Steve Huffman, a co-founder of Reddit, returned as CEO in 2015, the startup has revamped and refined its content policies. Reddit banned communities from Nazis and other far-right conditions. In June, it banned The_Donald, a sub-forum dedicated to supporters of President Donald J. Trump, who according to the company repeatedly violated its rules against harassment and other behavior.
Reddit said it plans to use the new injection of capital to expand its community of more than 50 million daily active users. This includes the trial of more influencers and content creators, which it did when it bought short-form video platform Dubsmash, a rival of TikTok, in December. Reddit, which has more than 700 employees, also said it would double the number this year.