SAN FRANCISCO – Just out of a Super Bowl winning ad and a role at the center of a recent stock market frenzy, Reddit announced on Monday that it raised $ 250 million in new financing, evaluating the news start-up. $ 6 billion according to its goal to boost user growth and double its workforce.
The investment is a shot in the arm of 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 assessment of its latest financing in 2019.
Reddit, based in San Francisco, said the funding was based on the success of its burgeoning advertising business, as brands and marketers are drawn to the site’s powerful and active community members.
“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. “We are dedicated to Reddit because we believe in the power of communities that provide a sense of belonging and connection that is as real as the ones we create offline.”
Reddit has been highly visible in recent days. Last month, stocks at video game retailer GameStop skyrocketed when users of Reddit’s WallStreetBets forum, known as “subreddit”, urged each other to buy the stock, in part to arrest the hedge funds that bet the stock would fall .
This took GameStop’s stock on an extraordinary and volatile journey. After a flood of media attention, the WallStreetBets forum has grown to more than seven million members. Several book and movie rights were purchased during the saga, with the prospect of fame and money involving the forum moderators in heated disputes.
Reddit was also widely praised for a five-second commercial that aired during the Super Bowl on Sunday, which became one of the most talked about in a day filled with commented ads. The Reddit ad, which required viewers to pause their television screens to read it, proclaimed, “Wow, that really worked.” Viewers struggled to capture images of one of the Super Bowl’s shortest ads to post on social media.
Reddit has had its share of 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 sub-forums dedicated to racist comments, citing the need for free and unrestricted speech.
In recent years, the company has changed its tone about content moderation. Since Steve Huffman, co-founder of Reddit, returned as chief executive in 2015, the start-up has revamped and adjusted its content policies. Reddit has blocked communities of Nazis and other far-right contingents. In June, it banned The_Donald, a sub-forum dedicated to supporters of President Donald J. Trump, which the company said has repeatedly broken its rules against harassment and other behavior.
Reddit said it plans to use the new capital injection to expand its community of more than 50 million daily active users. That includes courting more influencers and content creators, a move he took when he bought the short-form video platform Dubsmash, a rival of TikTok, in December. Reddit, which has more than 700 employees, also said it would double that number this year.