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15 replies

catloaf
lemm.ee

The source: reddit and its bankers. Like I'm going to believe that.

Also, the valuation works out to only $750m? That seems low considering how much they've been hyping it.

Edit: the valuation is $6.5b but the IPO would fetch $750m. Not sure how that math works.

74
empireOfLove2reply
lemmy.dbzer0.com

$6.5b but the IPO would fetch $750m.

Pretty normal. They sell off a set % of the company's shared during an Initial Public Offering and set the share base price at their calculated expected valuation. Companies never sell off 100% of their shares. Reddit owns these shares and sets the sell price accordingly. Raising 750m would be selling about 11.5% stake if they think they're worth $6,500mil.

The market is not obligated to buy shares at Reddit's stated price. Once they're on the market shares can go up or down depending on how realistic the market thinks Reddit's stated valuation is. If they think the valuation is crap they'll not buy until the share price drops to their expected valuation.

42
stolyreply
lemmy.world

They are essentially selling that percentage of the company to the public at large. Not enough for any shareholder to have any power over it, but enough for the company to get some spending money.

12
tsonfeirreply
lemm.ee

Which would be good considering they can’t make a profit. Although, I wonder how that makes them worth anything. The intricacies of legalized gambling and money laundering escapes me.

12
mark3748reply
sh.itjust.works

It’s quite literally in the disclosures and the article you are commenting on. They lost $151MM in 2022 and $90MM in 2023.

5
ColeSlothreply
discuss.tchncs.de

They were looking at selling 8% for the initial IPO offering is how.

Aside from that, there valuation is double what it would be. This stock will wind up settling at 15 to 20 a share within a couple months, IMO. Their revenue isn't really that much, the ai data isn't going to become much more profitable for them after this year, and redditors have been getting less thrilled with the site for the past 5 years. They're peaking in profits right now. It won't get better for them.

9
foggy
lemmy.world

😂

Are you guys coming to my birthday party? It's gonna be the biggest most awesomest day ever!! Mom said we'll have a bouncy castle!

32
revisable677
feddit.de

Thanks for sharing, but they seem like the last people one should ask about the evaluation....

6
1984
lemmy.today

The stock is still not active. :/ Wanted to see the shit storm....

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Reddit guides IPO may price at top of range or above, source says | Spyke