A Reddit logo displayed on a smartphone with the stock market prices in the background.
Omar Marques | LightRocket | Getty Images
Reddit, which has been at the center of a recent frenzy of retail trading driven by social media, said on Monday that it raised more than $ 250 million in a new round of financing that doubled its valuation to $ 6 billion.
The social media company was valued at $ 3 billion after a financing round in February 2019.
“We decided that now was the right opportunity to make strategic investments in Reddit, including video, advertising, consumer products and expanding into international markets,” the company said in a blog.
Reddit CEO Steve Huffman told The Wall Street Journal that it is a good market for raising funds.
“Valuations are very high now. It never hurts to raise money when there is an opportunity to do so and Reddit has had a strong year,” said Huffman, according to the WSJ report.
Reddit, which has more than 50 million daily active users, said on the blog that advertising revenue increased 90% in the last quarter compared to the previous year.
Video game retailer GameStop and other companies, including movie operator AMC Entertainment, have seen their stocks fluctuate in the past two weeks, when amateur investors on forums like Reddit’s WallStreetBets acted together to increase the shares against which some US funds had previously filed. bet.
The rally attracted the attention of regulators, although U.S. Treasury Secretary Janet Yellen said on Sunday that it was too early to say whether new policies or regulations are needed to deal with volatility.