Pictured: Original Reddit cofounder Alexis Ohanian during a book tour in Washington, D.C.
There’s good news for Reddit and Reddit users this evening. The popular Conde Nast-owned social media blog just raised $50 million in funding from the President of Y Combinator, Sam Altman, and outside investors including the likes of celebrities Jared Leto and Snoop Dogg.
More interestingly, Reddit has also announced its intention to distribute 10% of this funding to actual Reddit users.
How Reddit will do this is yet to be suggested, but apparently the idea stems long before Conde Nast was running things with the original founder Alexis Ohanian, angel investor Joshua Kushner, and their backers. Reddit suggests Altman has some new ideas:
“We think we’ve come up with a way. Led by Sam, the investors in this round have proposed to give 10% of their shares back to the community, in recognition of the central role the community plays in reddit’s ongoing success. We’re going to need to figure out a bunch of details to make it work, but we’re hopeful. We’ll have more specifics to share about it soon, but in the meantime we wanted to mention it here.”
Most of the funding will go to hiring more staff to build better development tools like their mobile AMA app and other items like a “redditgiftsmarketplace.” Are you a Reddit users with thousands of karma? Perhaps this is your ticket to Dogecoin riches. Let us know what you think of the invester sharing in the comments.
For the full Reddit blog post on the funding, read on below:
Fundraising for reddit
Posted by yishan at 10:39 |
Labels: friends of Snoo, fundraising, we require additional vespene gas
We’d like to announce to that reddit has just closed a $50 million round of outside funding. Our lead investor is Sam Altman, with participation from Alfred Lin of Sequoia Capital and Marc Andreessen of Andreessen Horowitz.
Sam is the President of Y Combinator, the incubator that originally helped launch reddit. He is one of the first handful of reddit users, a member of the same YC batch that Steve and Alexis were in. He signed up at a dinner with Steve and Alexis when they showed a beta version of reddit to get feedback. He’s a long-time fan of reddit, and is excited to help us take reddit to the next stage. Sam will be doing an AMA today to take questions from the community.
Other investors participating in this round include Peter Thiel, Ron Conway, Paul Buchheit, Jared Leto, Jessica Livingston, Kevin and Julia Hartz, Mariam Naficy, Josh Kushner, Snoop Dogg, and Yishan Wong.
What does this financing mean for reddit?
reddit has had a long and complex history, starting as one of the first Y Combinator companies, then as a division of Conde Nast, and three years ago spun out as an independent entity. During all of this time we have operated with a shoestring budget. This made us become efficient; it also meant that we were only able to work on essential features and were always understaffed. Even with the last year’s hiring (we’re 60+ strong now), we’ve found that there are still a lot more features you’ve been asking for that we haven’t always been able to get to as fast as we’d like.
Thus, we’re planning to use this money to hire more staff for product development, expand our community management team, build out better moderation and community tools, work more closely with third party developers to expand our mobile offerings (try our new AMA app), improve our self-serve ad product, build out redditgifts marketplace, pay for our growing technical infrastructure, and all the many other things it takes to support a huge and growing global internet community.
Joshua Kushner, one of our angels, published a memorable statement about a startup he co-founded:
“There is a common misconception in the technology industry that raising capital is correlated with success. Financing is not innovation, nor should it be celebrated. On the contrary, we have a tremendous amount of work to do.”
This is how we feel. An investment like this doesn’t mean we’re rich or successful. A couple days after we closed the financing, Sam came to our office and handed me a genuine 100 trillion dollar Zimbabwean note, as a reminder to us of the difference between money and value. Money can become worthless very quickly, value is something that is built over time through hard work.
We have been entrusted with capital by patient, long-term investors who support our views on difficult issues. We believe in free speech, self-governing communities, and the power of voting. We find that this freedom yields more good than bad, and we have chosen investors based on this belief.
But wait there’s more
We’ve long been trying to find a way for the community to own some of reddit, because it is your contributions that help to anchor the site and give it strength. We’ve actually discussed possible ways to do this for years – Alexis, Erik, I, and our backers at Advance (parent company of Conde Nast) have tried to come up with creative ways to do it, but they never worked out or ran into legal obstacles.
We think we’ve come up with a way. Led by Sam, the investors in this round have proposed to give 10% of their shares back to the community, in recognition of the central role the community plays in reddit’s ongoing success. We’re going to need to figure out a bunch of details to make it work, but we’re hopeful. We’ll have more specifics to share about it soon, but in the meantime we wanted to mention it here.
Thank you to everyone who’s helped to make reddit what it is today. We have a tremendous amount of work to do, and we hope you’ll continue to support us.
May the reddits continue on its course to its destiny uninterrupted.
Source: Reddit Blog