11 ms·

I clearly have no idea what is going on or how business works because the only question plaguing my mind is how on earth reddit manages to be valued at $10B. Do

I clearly have no idea what is going on or how business works because the only question plaguing my mind is how on earth reddit manages to be valued at $10B. Does low-key shilling and banner ads really make that much money? I know it doesn't work this way but they'd have to collect $192 from their 52M daily users to earn that kind of cash. Honestly I got the impression reddit stopped being cool like 5 years ago and other than this year's entertaining stock market shenanigans it's largely a novelty. Even when I was using it I could hardly imagine my eyes were worth $192 to anybody. Not to mention last time I looked at reddit the incel and children under 18 vibes were intense. What do I know? FB somehow manages to be relevant. Am I missing something or are we just printing monopoly money based on increasingly loose pretexts nowadays? Do you even need a business model to make money anymore, or is it all based on speculative user counts and growth?

cblconfederate 5y ago
reddit is essential to google, adding it as a keyword in searches increases google's value by billions
- hmmokidk 5y ago
  If it weren't for reddit google would be damn near useless to me.
  - handrous 5y ago
    This isn't even a joke, it's just true. "reddit [my actual search]" is the only way I know to sort of get at all kinds of info that Google is no longer any good whatsoever at finding. I guess if that stops being useful, for some reason, I'll have to resort to one of those long queries that tries to limit searches to independent forums (which used to be visible without that kind of thing, when they were relevant, but are now nearly impossible to find otherwise). Twitter might be a partial replacement, but they seem dedicated to making searching their site, by any means, as useless as possible.
    - unemphysbro 5y ago
      I'm not the only one.
    - burnt_toast 5y ago
      I've had good luck on finding results in forums just by adding the word "forum" to the search. Not every result will be a forum but some should pop up
    - Ekaros 5y ago
      Switched browsers, ended up using bing for a while... It was even worse. SEO has destroyed the Internet, it's pretty hard to find anything relevant anymore... Outside a very few sites like Reddit, Stack Overflow and Wikipedia. And each of those has it own host of issue. Somethings kinda still work like technical information. Now to think might it be that some engineers at Google actually try to keep that section somewhat usable?
      - BitwiseFool 5y ago
        I yearn for a curated search engine that only looks at a small section of the internet and completely omits notorious SEO abusing sites. Most of the time, I am not trying to search through the corpus of human knowledge (google's old goal), but rather, to perform a very specific kind of search in a specific problem domain.
        danskeren 5y ago
        I'm working on something like this for code search (https://ask.moe/search/code https://ask.moe/search/code), which currently consist of about 150 sites that I will continue to expand whenever I discover a useful site missing (e.g. official website of some package that contain good documentation). I decided to start with code because it's something I personally use every day, and I got fed up with the spammy sites that just present an answer (or often only the question itself) extracted from StackOverflow, but plan to do something similar with other categories in the future. I'm curious to hear how you'd approach this problem, as in which categories you'd support and how you'd break it down?
- edrxty 5y ago
  Shhh don't tell anyone, the advertisers will start trying to defeat this. But seriously, I don't understand how Google has let their results become such trash. If you actually want community sentiment (what's generally accepted as the least shitty X you can buy) you have to dig through reddit results. If you don't it's AI generated blogspam for days
  - wombat-man 5y ago
    It's pretty sad actually. Especially if I'm trying to look up anything that might be related to a buying decision. What's fun is reddit's search feature is kinda garbage so they really need each other.
  - mint2 5y ago
    I’ve been unimpressed by google, but the feature that’s finally catalyzed me to explore other search engines is the way they now take up precious mobile browser screen space when one searches with a frozen pane of the search. Terrible ui decision.
toxik 5y ago
Control over media platforms is basically control over the agenda in democracies. It is worth a lot of money.
- Ekaros 5y ago
  But does it make media platforms themselves worth lot of money? Then again, I don't really understand valuation of most "tech" companies...
  - toxik 5y ago
    There are so many sleights of hand type maneuvers you can pull to moderate sitewide. Tiktok, for example, bans LBTQ content not outright but just sets some flag in their database that ascertains the posts never go viral. Control the medium, control the message.
- analyte123 5y ago
  The social aspect of Reddit is a massive enhancement of this. It's one thing to see a headline on WaPo or NYT. It's another to see that on Reddit, with dozens of commenters all posting takes that advance the same frame or line of reasoning, upvoting each other, congratulating each other on how smart they are, etc. What you don't see are the interlocking moderators on all the top subs or the fact that people are frequently banned from completely unrelated subs for political reasons based on their posting history. The result is an echo-chamber that is a 90% match for the editorial stance of WaPo or NYT at all times, except it looks social and organic, and therefore extremely convincing to onlookers.
  - toxik 5y ago
    It's an interesting study in human self-organizing behavior. We like to see our opinions confirmed, so we like sites like reddit, which breeds this exact behavior. This leads to the groupthink or hivemind as reddit users call it.
3pt14159 5y ago
It isn't really worth $192 per user. It's worth, say, $40 per user if there was an absolute certainty that they wouldn't grow their user base and just stay at fifty million users for the next hundred years. But with tech, there is a non-trival chance (say 5%) that they 10x their user base and 5x the amount of income they receive per user per year. You never know how these things will go, but the downside of a stock is limited. The upside isn't. As an aside, Reddit is great if you're in the right subreddits and clear out the junk that appeals to the broad public or is frequently gamed by political actors.
- SV_BubbleTime 5y ago
  > As an aside, Reddit is great if you're in the right subreddits and clear out the junk that appeals to the broad public or is frequently gamed by political actors. I disagree. To me, going hyperbolic to make a point, this is like saying there were some really great bars in 1930s Germany. It kinda doesn’t mean much if you bury your head in the sand here. It’s a bad company that does bad things. That’s cool you like some people who agree with you, but these people would be cool elsewhere too.
BitwiseFool 5y ago
>Does low-key shilling and banner ads really make that much money. I genuinely believe Reddit's real value proposition is manipulating the content shown to the masses. As a propaganda tool, it's incredibly powerful to saturate people's feeds with consistent and coordinated messaging. At any given time, the feed of r/all and r/popular has several agenda-posts and submissions designed to be derisive and derisive. The nature of the subreddits themselves can also be co-opted, as r/facepalm, r/insanepeoplefacebook, and r/publicfreakout are basically used to mock conservative pundits and politicians. "Niche" criticism subreddits - made specifically to mock the other side - also pop up from time to time, like r/HermanCainAward and r/LeopardsAteMyFace. There are, of course, constantly submissions from obviously leftist subreddits like r/LateStageCapitalism, r/PoliticalHumor, and r/AntiWork. But screenshots of tweets posted there inevitably end up on both r/WhitePeopleTwitter, r/BlackPeopleTwitter. That being said, I think r/pics has the most subtle manipulation. If Donald Trump was in the headlines for doing something bad, you would see pleasant photographs of Obama with tens of thousands of up votes. Something about Antifa in the news? Plenty of d-day and patriotic Nazi fighting images. Right now there is protest art against the Texas abortion decision. Lots of things on r/pics are harmless, of course. But you will also see odd things where the post has 50k point score, with a 50% approval score, and the comments are all overwhelmingly negative. I recently saw this on a post comparing Taliban forces in technical trucks with a bunch of rednecks in Toyotas with Trump flags. Make of that what you will. I could go on and on, but if you wanted to persuade people on a near subconscious level, Reddit is nearly the perfect avenue to do so.
- MMS21 5y ago
  "Leftist communities on Reddit often implore the company to ban The_Donald. So far, Huffman has demurred. “There are arguments on both sides,” he said, “but, ultimately, my view is that their anger comes from feeling like they don’t have a voice, so it won’t solve anything if I take away their voice.” He thought of something else to say, but decided against it. Then he took a swig of beer and said it anyway. “I’m confident that Reddit could sway elections,” he told me. “We wouldn’t do it, of course. And I don’t know how many times we could get away with it. But, if we really wanted to, I’m sure Reddit could have swayed at least this election, this once.” That’s a terrifying thought. It’s also almost certainly true." - Reddit CEO Steve Huffman source https://www.newyorker.com/magazine/2018/03/19/reddit-and-the-struggle-to-detoxify-the-interne https://www.newyorker.com/magazine/2018/03/19/reddit-and-the...
mbesto 5y ago
> how on earth reddit manages to be valued at $10B Reddit is ~16 years old and was in one of YC's first batches (first batch ever?). This is an absolute dinosaur in "startup" age. It's been acquired, traded, and recap'd multiple times for (presumably) sub-$1B value. For all intents and purposes it's a distressed asset in "enchanted forest" terms (note - this is not a criticism per se, many distressed assets can be very valuable). I'm convinced (with limited evidence as an outsider) the following drives their valuation: - Record valuations of FB, Snapchat, Instagram, Twitter, etc. that have comparable features and "industry metrics" (DAU, MAU, etc.) that can be easily parsed by public analysts. The latest round of investors probably got a great insider deal so they could prep it for IPO and pass it off to the next sucker. - Reddit started to receive more and more M&A attention when mobile biz models went public (Snap, Uber, etc.). The key to any financial success for Reddit is simply mobile. This an incredibly risky, because (1) reddit allows 3p mobile apps where they can't control ads/tracking and (2) their conversion to their own Reddit mobile app is extremely user hostile. But this is essentially it - you can track and sell ads on Reddit via it's native mobile apps. If somehow (I'm personally not convinced) they can get everyone on to their native mobile app, then sure, they will be as valuable as Snap/Twitter. - It's essentially a "cost of doing business" for YC. If Reddit became essentially not valuable or not as valuable in the public eye it undermines YC's brand. This has become less and less an issue overtime as more successes have come out of YC, but during those time periods when it wasn't the value had to be continually projected as being valued (thereby creating steam that never fizzeld out). Think of this like saying one of your clients in the 90's was Bear Stearns, which gave you social proof to work with Goldman Sachs, etc. you'll hold on to that Bear Stearns logo on your sales deck until it ultimately fails, but now you have Goldman, Morgan, etc. to show your social proof.
- crazy_horse 5y ago
  It's crazy to me that Reddit isn't a mark on YC's brand. I can't think of a worse site to use today. It makes it clear to me that YC's business model doesn't really care about quality because Reddit has only degraded year by year. I mean if you want to make money, cool, but if your startup is based out of YC, I don't trust you.
  - 5y ago
keewee7 5y ago
r/worldnews has become the default news aggregator of the world. Journalists around the world use that subreddit to gauge which topics interests people. That is why it's concerning that the modding and mod selection process on big subreddits like r/worldnews is so opaque.
- deleted 5y ago
  [deleted]
- crazy_horse 5y ago
  Not to be pedantic, but why do you say this? Is it really that visible?
- asdff 5y ago
  It's a pretty poor pulse on whats actually interesting to people honestly. Might as well just subscribe to publishers RSS feeds, you will get about the same content. Look at the post histories of these accounts that make these top posts. Very strange post histories, sometimes only making posts to worldnews. It's not exactly rocket science to operate a botnet that posts your articles all over relevant subreddits, even operate a ring of accounts to upvote a post enough to get it rolling in hot and upvoted organically from there on by users who tend to just roll with whats slightly upvoted.
unemphysbro 5y ago
My mom started using reddit this year. Maybe it's capturing the non-(tech/young)-people market share?

cblconfederate 5y ago

reddit is essential to google, adding it as a keyword in searches increases google's value by billions

hmmokidk 5y ago
If it weren't for reddit google would be damn near useless to me.
- handrous 5y ago
  This isn't even a joke, it's just true. "reddit [my actual search]" is the only way I know to sort of get at all kinds of info that Google is no longer any good whatsoever at finding. I guess if that stops being useful, for some reason, I'll have to resort to one of those long queries that tries to limit searches to independent forums (which used to be visible without that kind of thing, when they were relevant, but are now nearly impossible to find otherwise). Twitter might be a partial replacement, but they seem dedicated to making searching their site, by any means, as useless as possible.
  - unemphysbro 5y ago
    I'm not the only one.
  - burnt_toast 5y ago
    I've had good luck on finding results in forums just by adding the word "forum" to the search. Not every result will be a forum but some should pop up
  - Ekaros 5y ago
    Switched browsers, ended up using bing for a while... It was even worse. SEO has destroyed the Internet, it's pretty hard to find anything relevant anymore... Outside a very few sites like Reddit, Stack Overflow and Wikipedia. And each of those has it own host of issue. Somethings kinda still work like technical information. Now to think might it be that some engineers at Google actually try to keep that section somewhat usable?
    - BitwiseFool 5y ago
      I yearn for a curated search engine that only looks at a small section of the internet and completely omits notorious SEO abusing sites. Most of the time, I am not trying to search through the corpus of human knowledge (google's old goal), but rather, to perform a very specific kind of search in a specific problem domain.
      - danskeren 5y ago
        I'm working on something like this for code search (https://ask.moe/search/code https://ask.moe/search/code), which currently consist of about 150 sites that I will continue to expand whenever I discover a useful site missing (e.g. official website of some package that contain good documentation). I decided to start with code because it's something I personally use every day, and I got fed up with the spammy sites that just present an answer (or often only the question itself) extracted from StackOverflow, but plan to do something similar with other categories in the future. I'm curious to hear how you'd approach this problem, as in which categories you'd support and how you'd break it down?
edrxty 5y ago
Shhh don't tell anyone, the advertisers will start trying to defeat this. But seriously, I don't understand how Google has let their results become such trash. If you actually want community sentiment (what's generally accepted as the least shitty X you can buy) you have to dig through reddit results. If you don't it's AI generated blogspam for days
- wombat-man 5y ago
  It's pretty sad actually. Especially if I'm trying to look up anything that might be related to a buying decision. What's fun is reddit's search feature is kinda garbage so they really need each other.
- mint2 5y ago
  I’ve been unimpressed by google, but the feature that’s finally catalyzed me to explore other search engines is the way they now take up precious mobile browser screen space when one searches with a frozen pane of the search. Terrible ui decision.

toxik 5y ago

Control over media platforms is basically control over the agenda in democracies. It is worth a lot of money.

Ekaros 5y ago
But does it make media platforms themselves worth lot of money? Then again, I don't really understand valuation of most "tech" companies...
- toxik 5y ago
  There are so many sleights of hand type maneuvers you can pull to moderate sitewide. Tiktok, for example, bans LBTQ content not outright but just sets some flag in their database that ascertains the posts never go viral. Control the medium, control the message.
analyte123 5y ago
The social aspect of Reddit is a massive enhancement of this. It's one thing to see a headline on WaPo or NYT. It's another to see that on Reddit, with dozens of commenters all posting takes that advance the same frame or line of reasoning, upvoting each other, congratulating each other on how smart they are, etc. What you don't see are the interlocking moderators on all the top subs or the fact that people are frequently banned from completely unrelated subs for political reasons based on their posting history. The result is an echo-chamber that is a 90% match for the editorial stance of WaPo or NYT at all times, except it looks social and organic, and therefore extremely convincing to onlookers.
- toxik 5y ago
  It's an interesting study in human self-organizing behavior. We like to see our opinions confirmed, so we like sites like reddit, which breeds this exact behavior. This leads to the groupthink or hivemind as reddit users call it.

3pt14159 5y ago

It isn't really worth $192 per user. It's worth, say, $40 per user if there was an absolute certainty that they wouldn't grow their user base and just stay at fifty million users for the next hundred years. But with tech, there is a non-trival chance (say 5%) that they 10x their user base and 5x the amount of income they receive per user per year. You never know how these things will go, but the downside of a stock is limited. The upside isn't. As an aside, Reddit is great if you're in the right subreddits and clear out the junk that appeals to the broad public or is frequently gamed by political actors.

SV_BubbleTime 5y ago
> As an aside, Reddit is great if you're in the right subreddits and clear out the junk that appeals to the broad public or is frequently gamed by political actors. I disagree. To me, going hyperbolic to make a point, this is like saying there were some really great bars in 1930s Germany. It kinda doesn’t mean much if you bury your head in the sand here. It’s a bad company that does bad things. That’s cool you like some people who agree with you, but these people would be cool elsewhere too.

BitwiseFool 5y ago

>Does low-key shilling and banner ads really make that much money. I genuinely believe Reddit's real value proposition is manipulating the content shown to the masses. As a propaganda tool, it's incredibly powerful to saturate people's feeds with consistent and coordinated messaging. At any given time, the feed of r/all and r/popular has several agenda-posts and submissions designed to be derisive and derisive. The nature of the subreddits themselves can also be co-opted, as r/facepalm, r/insanepeoplefacebook, and r/publicfreakout are basically used to mock conservative pundits and politicians. "Niche" criticism subreddits - made specifically to mock the other side - also pop up from time to time, like r/HermanCainAward and r/LeopardsAteMyFace. There are, of course, constantly submissions from obviously leftist subreddits like r/LateStageCapitalism, r/PoliticalHumor, and r/AntiWork. But screenshots of tweets posted there inevitably end up on both r/WhitePeopleTwitter, r/BlackPeopleTwitter. That being said, I think r/pics has the most subtle manipulation. If Donald Trump was in the headlines for doing something bad, you would see pleasant photographs of Obama with tens of thousands of up votes. Something about Antifa in the news? Plenty of d-day and patriotic Nazi fighting images. Right now there is protest art against the Texas abortion decision. Lots of things on r/pics are harmless, of course. But you will also see odd things where the post has 50k point score, with a 50% approval score, and the comments are all overwhelmingly negative. I recently saw this on a post comparing Taliban forces in technical trucks with a bunch of rednecks in Toyotas with Trump flags. Make of that what you will. I could go on and on, but if you wanted to persuade people on a near subconscious level, Reddit is nearly the perfect avenue to do so.

MMS21 5y ago
"Leftist communities on Reddit often implore the company to ban The_Donald. So far, Huffman has demurred. “There are arguments on both sides,” he said, “but, ultimately, my view is that their anger comes from feeling like they don’t have a voice, so it won’t solve anything if I take away their voice.” He thought of something else to say, but decided against it. Then he took a swig of beer and said it anyway. “I’m confident that Reddit could sway elections,” he told me. “We wouldn’t do it, of course. And I don’t know how many times we could get away with it. But, if we really wanted to, I’m sure Reddit could have swayed at least this election, this once.” That’s a terrifying thought. It’s also almost certainly true." - Reddit CEO Steve Huffman source https://www.newyorker.com/magazine/2018/03/19/reddit-and-the-struggle-to-detoxify-the-interne https://www.newyorker.com/magazine/2018/03/19/reddit-and-the...

mbesto 5y ago

> how on earth reddit manages to be valued at $10B Reddit is ~16 years old and was in one of YC's first batches (first batch ever?). This is an absolute dinosaur in "startup" age. It's been acquired, traded, and recap'd multiple times for (presumably) sub-$1B value. For all intents and purposes it's a distressed asset in "enchanted forest" terms (note - this is not a criticism per se, many distressed assets can be very valuable). I'm convinced (with limited evidence as an outsider) the following drives their valuation: - Record valuations of FB, Snapchat, Instagram, Twitter, etc. that have comparable features and "industry metrics" (DAU, MAU, etc.) that can be easily parsed by public analysts. The latest round of investors probably got a great insider deal so they could prep it for IPO and pass it off to the next sucker. - Reddit started to receive more and more M&A attention when mobile biz models went public (Snap, Uber, etc.). The key to any financial success for Reddit is simply mobile. This an incredibly risky, because (1) reddit allows 3p mobile apps where they can't control ads/tracking and (2) their conversion to their own Reddit mobile app is extremely user hostile. But this is essentially it - you can track and sell ads on Reddit via it's native mobile apps. If somehow (I'm personally not convinced) they can get everyone on to their native mobile app, then sure, they will be as valuable as Snap/Twitter. - It's essentially a "cost of doing business" for YC. If Reddit became essentially not valuable or not as valuable in the public eye it undermines YC's brand. This has become less and less an issue overtime as more successes have come out of YC, but during those time periods when it wasn't the value had to be continually projected as being valued (thereby creating steam that never fizzeld out). Think of this like saying one of your clients in the 90's was Bear Stearns, which gave you social proof to work with Goldman Sachs, etc. you'll hold on to that Bear Stearns logo on your sales deck until it ultimately fails, but now you have Goldman, Morgan, etc. to show your social proof.

crazy_horse 5y ago
It's crazy to me that Reddit isn't a mark on YC's brand. I can't think of a worse site to use today. It makes it clear to me that YC's business model doesn't really care about quality because Reddit has only degraded year by year. I mean if you want to make money, cool, but if your startup is based out of YC, I don't trust you.
- 5y ago

keewee7 5y ago

r/worldnews has become the default news aggregator of the world. Journalists around the world use that subreddit to gauge which topics interests people. That is why it's concerning that the modding and mod selection process on big subreddits like r/worldnews is so opaque.

deleted 5y ago
[deleted]
crazy_horse 5y ago
Not to be pedantic, but why do you say this? Is it really that visible?
asdff 5y ago
It's a pretty poor pulse on whats actually interesting to people honestly. Might as well just subscribe to publishers RSS feeds, you will get about the same content. Look at the post histories of these accounts that make these top posts. Very strange post histories, sometimes only making posts to worldnews. It's not exactly rocket science to operate a botnet that posts your articles all over relevant subreddits, even operate a ring of accounts to upvote a post enough to get it rolling in hot and upvoted organically from there on by users who tend to just roll with whats slightly upvoted.

unemphysbro 5y ago

My mom started using reddit this year. Maybe it's capturing the non-(tech/young)-people market share?