Reddit Inc. doubled its valuation to $ 6 billion in a new round of funding that comes as the social media company has added users through the Covid-19 pandemic and, more recently, has drawn attention to the his role in the recent Wall Street trade frenzy.
Reddit said Monday it raised $ 250 million in a final-round funding round led by venture capital firm Vy Capital. It was previously valued at $ 3 billion after its last round of funding in February 2019, according to PitchBook, a private market data provider. Current investors on Reddit also include venture capital firm Andreessen Horowitz and internet conglomerate Tencent Holdings Ltd.
“It’s a good market to raise funds,” Reddit CEO Steve Huffman said in an interview. “Right now, the ratings are very high. It never hurts to raise money when there is an opportunity to do so and Reddit had a strong year. For example, the company’s advertising revenue increased 90% in the quarter ended December compared to the previous year, he said.
Reddit funding comes just weeks after the new Clubhouse social network, which began, raised new capital. Clubhouse was valued at $ 1 billion last month after securing $ 100 million in a round of funding led by Andreessen, according to PitchBook.
San Francisco-based Reddit, founded in 2005, is known for its message boards on a multitude of topics, as well as its digital “ask me anything” town halls with celebrities, politicians, and subject matter experts. The company, which is unprofitable, was sold to Condé Nast in 2006 and the father of the magazine’s publisher, Advance Publications Inc., withdrew Reddit in 2011 and remains a shareholder. The company has raised approximately $ 800 million since 2011.