Reddit, the self-proclaimed “front page of the internet,” has triumphantly priced its Initial Public Offering (IPO), securing proceeds totaling $748 million. The IPO, which marks the first public market debut of a major social media player in nearly five years, signals a strong demand for Reddit stock and bodes well for the overall IPO market.
The offering saw 22 million shares priced at $34 each, at the top end of the initially advertised range of $31 to $34 per share. This successful pricing underscores the confidence investors have in Reddit’s future prospects. Of the total proceeds, $520 million will go directly to Reddit, while the remaining $228 million will benefit selling shareholders.
Following the IPO, Reddit stock is going to commence trading on the New York Stock Exchange under the ticker symbol RDDT. Despite Reddit’s impressive debut in the public market, its valuation of $6.5 billion represents a decline from its last private market financing round in 2021.
Social Media Giant Reddit Soars in IPO, Valued at $6.5 Billion
Reddit’s IPO resurgence draws comparisons to the public offering of Pinterest in April 2019, which debuted at $19 per share. Since then, Pinterest shares (NYSE: PINS) have experienced fluctuations but are currently valued at around $34.75, illustrating the potential for growth in the social media sector.
While the Reddit IPO may not have direct implications for the FX and CFDs business, Reddit remains a hub for retail traders to exchange information and insights on the industry and the brokers within it. The success of Reddit’s public offering offers valuable lessons for retail-serving FX and CFDs brokers considering their own IPOs.
eToro, a prominent player in the social trading-focused online brokerage space, stands out among potential IPO candidates. CEO Yoni Assia had expressed intentions to take eToro public following a previous unsuccessful attempt at an IPO in 2021-22 when the company pursued a SPAC merger. Similarly, other retail FX and CFDs brokers such as Saxo Bank and ThinkMarkets, both of which have previously explored public offerings via SPAC mergers, may reconsider their options in light of Reddit’s IPO triumph.
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