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https://www.investors.com/news/technology/reddit-insiders-selling-days-after-ipo-shares-fall/
He sold about 500,000 shares. He owned, apparently, 3.3% of the 17.06 million total shares of the company, meaning he had a little over 562,000 shares. He sold almost all of his shares. That doesn't exactly exude confidence in future growth, IMO.
Lol, if only someone, or like, thousands of someones, warned the others and this. Shame. Anyway...
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On the other hand, he already cashed out once and was wrong, so...
https://en.wikipedia.org/wiki/Steve_Huffman
The site's audience grew rapidly in its first few months, and by August 2005, Huffman noticed their habitual user-base had grown so large that he no longer needed to fill the front page with content himself.[11][14][15] Huffman and Ohanian sold Reddit to Condé Nast on October 31, 2006, for a reported $10 million to $20 million.[3][16] Huffman remained with Reddit until 2009, when he left his role as acting CEO.[17]
Huffman spent several months backpacking in Costa Rica[18] before co-creating the travel website Hipmunk with Adam Goldstein, an author and software developer, in 2010. Funded by Y Combinator,[19][20] Hipmunk launched in August 2010[21] with Huffman serving as CTO.[22] In 2011, Inc. named Huffman to its 30 under 30 list.[22]
In 2014, Huffman said that his decision to sell Reddit had been a mistake, and that the site's growth had exceeded his expectations.[23] On July 10, 2015, Reddit hired Huffman as CEO following the resignation of Ellen Pao[24] and during a particularly difficult time for the company.[25] Upon rejoining the company, Huffman's top goals included launching Reddit's iOS and Android apps, fixing Reddit's mobile website, and creating A/B testing infrastructure.[3]
Since returning to Reddit, Huffman instituted a number of technological changes including an updated mobile site and stronger infrastructure, as well as new content guidelines.
I don't think that he's had a whole lot of faith in Reddit as a business since early-on.
Huffman’s top goals included launching Reddit’s iOS and Android apps
Mission accomplished! Those undeniably shitty apps definitely were launched.
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I've never used them, but IIRC they acquired some third-party client and then just modified them. "Blue Alien" or something like that?
googles
"Alien Blue", at least for the official iOS app.
https://en.wikipedia.org/wiki/Alien_Blue
I dunno what the history of the Android app is.
That being said, they're responsible for what they acquire, just saying that a lot of that might not be developed in-house.
They acquired Alien Blue, but what they put out under “Reddit” was not Alien Blue in the least bit. They basically bought it to kill it. I had Alien Blue. :(
Hey, acquiring another app and launching it as your own app is still launching it! What would they have done without spez?
Those ass-butts.
This is redundant. That's why we put caps on them and call em ass-hats
My favorite way to visualize the meaning of "asshat": the person is such a sad waste of human life that their entire upper body is effectively just a hat for their posterior.
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Well, you wouldn't expect it to in the growth phase.
A lot of consumer-facing Internet companies have a large portion of their costs be fixed costs. That is, a programmer or QA guy costs the same amount whether you have ten users or ten million users. But your revenue is linear in your userbase size. So you really don't want to be a small company, if you fit that profile.
The idea is to burn money and grow rapidly to the point where your fixed costs are relatively small. It makes no sense to try to generate profit if you lose growth for it.
That's especially true for social media companies, because for them, network effect is a major factor -- the value of the network is something like the square of the number of users.
So you really want to be big, not small.
So the solution is to grow quickly, lose money during that period, then adjust and monetize the userbase when you can't afford to burn money growing any more.
That transition to a profitable state after a money-losing growth state usually means that a company is gonna do something unpopular (since they're optimizing for something other than appeal) and what Corey Doctorow was complaining about as "enshittification".
The fact that Reddit lost money during the growth phase doesn't mean that it was a failure -- that would have been intended, part of the business model.
Now, if it's losing money once the growth phase is done, that could be another story.
It's old enough to vote. Or serve in the US military.
Or attend college as a non-genius.
I'm familiar with growth stage. 18 to 19 years seems like a long one. Web 2.0 happened years ago.
Where are you getting this info?
According to the second link, he sold nearly all of his class A shares, but none of his class B shares. His total share of the company went from 3.2% to 2.6%, which, is still not insignificant.
yeah but your *OP's statement 'he sold almost all of his shares' isn't really accurate as he really only sold 19% of his shares
I thought they paid him like $200M last year? How does that work out with only half a million shares?
It doesn't, he had like 4.6 million shares before the ipo. The 500,000 number sold is just his class A shares. He'll still have 4.1 million shares of class b stock after this it looks like. The class b stock has ten votes compared to one vote for class a stock for any shareholder votes I believe. So selling only his class a shares won't change the percent voting control of the company he has by much. The person you're replying to is confused about how many total shares he has. I don't think the class b shares are being openly traded though, I think the ipo is just offering class a shares, which is what's causing the confusion here. He sold almost all of his class a shares, but still has plenty of class b.
If the people in this thread could read this and understand it that would be amazing. This isn't some gotcha moment...
Yeah, I mean ipo's in general are definitely a rich get richer kind of thing that screw over retail traders, but I don't think there's anything particularly unusual about this one.
Yeah, that was my point. The $16.7M he sold is way less than they reportedly gave him last year.
That's weird, I thought the majority of the $150m or so he got last year was in stock. And this says he barely cleared 1/10th of that with this sale.
Edit: nevermind, explained in other comments
Absolutely. Although, of the 3rd party developers, Christian was probably the biggest thorn in Spez’s ass. Homie’s Apollo developer update posts were legendary and were covered by international press.
yeah he was the one who talked with reddit regarding that issue. idk about the thorn thing though. at the end reddit still runs even after multiple subreddits shutdown. hope reddit's stocks crash.
it might have hurt reddit's userbase a little but definitely not a scar. he has already sold most of shares, so he will be sailing that ship until he can loot all he could and then jump to another ship when it starts to sink.
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So, at some point, Reddit was going to have to be generating a return. Spez or no spez.
I don't particularly like the route they took -- killing the third-party clients was annoying and I think that there were ways to be a profitable super-forum site and still have third-party clients. But it was gonna be something, and whatever they did -- more ads, selling data on users, only providing some functionality to paid users -- was gonna be unpopular.
I would have been ok with reasonable prices for API calls. Bandwidth has a cost after all. But they so obviously set out to drive the third party apps out of business so they could sell ads in the official app/website it just disgusted me.
Also that new mobile site is so shitty, I refuse to believe it's not on purpose.
What they didn't see in doing so was that the core content of the site was curated mostly by people who used either old reddit or third party apps. Modding would be unnecessarily annoying without them. The content is, in fact, way worse than it used be, more importantly bots are in the open and with no counter. You can track the amount if reposts. As for mods they can be as toxic as ever, posting on reddit is hard unless you follow small subs or generic ones that let you post whatever. The site itself is the opposite of user friendly: they wanted to be an alternative to all other social media ever...but instagram, tiktok, youtube, even that deranged thing known as x, let you post peacefully amd without too many restrictions. Reddit...forget about it.
I don't get why they had to drive out 3rd party apps for that? They try to make the ads look like user content so it seems like they could have fed it into the 3rd party apps. It must have something to do with the exact placement of the ads?
Idk maybe for performance tracking purposes the ads are marked as such and it's accessible from the API
There were some internal docs leaked that made me think their real motivation was that they had signed some contracts for API access and pricing (probably a direct response to AI scraping), and that they were actually contractually obligated to close stuff down and/or set crazy prices. I think it may not have been about apps at all (or very little)
What do you think API access is? They have 100% control over how much they charge for access. There is no entity above them that they're signing contracts with to decide pricing. There is no situation where what you just said makes any sense.
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If you make stuff using money from investors who are giving you that money with the expectation that you will use it to generate a return, yeah, pretty much.
Reddit wasn't someone's volunteer project.
Honestly, the things that really pissed me off were
- Very little migration time. They pulled the rug out from everyone fairly quickly.
- The lying, and Christian’s evidence that proved they were lying.
- Not working with developers for a reasonable middle ground.
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I've given up on buying stocks for individual companies. I'd rather just stuff it in an index fund and pretend it doesn't exist for 10 years.
the average person usually doesnt beat the average index fund, so if you arent keen at day trading, dont do it.
No one is "keen" at day trading, some people get lucky and think they're talented. The vast majority lose money because the big players make sure of it.
It's literally just gambling, but nobody looks at a guy who won $50k at blackjack and says "hey I can make a career out of that."
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Blackjack is normally gameable.
https://en.wikipedia.org/wiki/Card_counting
I mean, I sure wouldn't want to do it as a career, but it's possible to beat the house over the long run depending upon how they've structured play.
That being said, I get your broader point, and there are obviously games of chance for which this is not true.
you definitely have people who go positive in day trading on average more than not by following some patterns and such, its just most people lack the kind of skills to do it and usually do worse than the index (even if they go positive)
I quit trying to day trade ages ago. I put my bigger investments in indexes or companies I think I'm more familiar with than "wall street" and usually long term hold.
If you have the money to spend/blow, the "correct" approach is to:
- Put the vast majority if your money into stable investments. Index funds, bonds, etc. You should have a retirement fund with at least one of the major companies (I have had good experience with Vanguard and Fidelity) and they can help with that. This is for retirement and the like.
- Put a VERY small amount into "one off" purchases of various stocks. Stuff like "I think this apple computers might take off some day" kind of purchases. This is not a retirement fund. This is gambling. But it still might mean you have money for a kitchen remodel or a rainy day.
But if you don't have money to "throw away"? Do not buy individual stocks. Or crypto. Or anything other than what you need to have a life after you age out of the workforce because late stage capitalism.
The thousands of rounds of ammunition I purchased during the height of covid has gone from 32 cents to 42 cents per round.
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Me too generally. But on a whim i bought 100 shares of NVDA back in 2019, and god damn has it been good so far.
That's advice I've been given many times in my life. If I had any money to invest, that is likely how I would do it.
Most of my etfs are doing better than my stock purchases, but I have had a couple big wins over the years. I'm expecting my reddit put options to be another, though.
Didn't know da brutal yet kunnin' boss of bosses was also a shrewd investor
Do ya have any teef in da shiny choppa index?
Hot take is I don't think anyone should care about Aaron Swartz. He didn't do anything for Reddit in the merger and left without doing anything for Reddit so who cares. He then died being a martyr for a cause barely anyone cares about and his death didn't inspire any change to education publication/copyright. Nobody should care.
Edit: you can downvote me all you want but I would like someone to comment on 1 thing Aaron contributed to Reddit. Why should anyone remember his name other than 'but he killed himself for the cause bro'.
I think you have to convince everyone why it is reasonable that you are so angry and hateful towards someone you never knew.
I wasn't angry or hateful though? If anything I'm irritated of all the praise for not inherently doing anything.
Literally I’ve seen two to three references of him after 17 years on reddit. You’re exaggerating how much people talk about him.
So by that logic Aaron is relatively obscure right? Must be surprising to see his name on a Lemmy thread with so many upvotes. 2 or 3 references lol sure. I'm sure you haven't also seen one of the 2 or 3 documentaries on his life either.
For someone who is tired of hearing about Aaron Schwartz, you sure have a lot to say about him, and seem to think about him quite a lot. More than me for sure.
He was also a libertarian techbro who thought 'child pornography isn't necessarily abuse'
In the US, it is illegal to possess or distribute child pornography, apparently because doing so will encourage people to sexually abuse children.
This is absurd logic. Child pornography is not necessarily abuse. Even if it was, preventing the distribution or posession of the evidence won't make the abuse go away. We don't arrest everyone with videotapes of murders, or make it illegal for TV stations to show people being killed.
https://web.archive.org/web/20090719140727/http://bits.are.notabug.com/
You should probably use quote formatting to indicate that that's a quote, because right now it looks like your words
In the sense that he actually was a "free speech absolutist" type, yeah. I think we can be pretty certain he didn't do it himself though, otherwise the FBI would absolutely have charged him for it as they harassed him to death.
From my experience, these people have lots more shares than what they sold. And aside from spez, it's not really that much.
If I am not mistaken, these sales are also planned and public knowledge before the sales are executed. The key shareholders should know executives are going to dump stock.
But yes. This seems normal to me.
One thing of note is the average price spez sold for. That is actually below market value so it's likely that his sale price was fixed, which I believe is a thing.
Yes. Insiders with that high a fraction of ownership exercise the ability to sell shares at a predetermined percentage value of a full priced share. Usually pegged to the closing price at the beginning or end of a quarter, whichever is lower.
At least they are destroying their own place, now lets hope they just become rich nobodys and keep their greedy fingers of everything else.
I don't. Such as the nature of living in the conservative fascist multiverse.
You cant expect everyone to stop wanting to crush the weak just because you were born in a era of unprecedented technological advancement. Feudalism is still alive and well in some parts of the world, and it has been going strong throughout human history. For all we know, it will outlast democracy.
We are cavemen and cavewomen with space ships and computer phones. Stop having such high expectations for us dumbasses.
This is just you saying that you would crush the weak if you had the opportunity so you empathize with those that do.
When I was poor and complained about inequality they said I was bitter; now that I'm rich and I complain about inequality they say I'm a hypocrite. I'm beginning to think they just don't want to talk about inequality.
Some of these people have been with Reddit since the very beginning and this is basically their first practical chance to sell any of their shares - I wouldn't read too much into their activity this week. For a company valued at $9B, having the founder & other executives only sell $41M in the week of the IPO if anything feels like the opposite of dumping.
I was thinking short sellers looking to profit would buy up as much as they could to make a bubble then short sell once the market started going sideways, and this chart seems to accurately reflect that:
Short!
My bet is the company winds up around a $2billion market cap after dipping to $1.5.
If you want to have a laugh at how ridiculous the whole market is, Trump's Truth Social just IPOed and has the same market cap as Reddit even though it's much smaller and full of insane people.
To be fair, Truth Social has a userbase who have proudly declared that they are rubes ripe for further grift.
So... It's more or less the same as Reddit, but with way, way, way less users and post history.
What!?
Of course it should be valued that high!
Totally good indicators of
Estimated 5million total users
3.5m revenues
49m operating expenses
Worth it!
/Sarcasm
They dumped $50 million the same week as the IPO? Talk about confidence in your company!
Also, they didn’t have any lockout period? That’s also bullshit. I worked for a company during an IPO some years back and nobody could sell their shares for something like a year!
I won't lie, I do regret not making a quick buck off of it. I could have gotten in at 30-something and out at 40-something easily enough.
I just couldn't stomach the thought of buying RDDT. I also guessed Pigboy Spez and his pals would leave us suckers holding the bag.
Turns out some brave peasants did make money on the IPO. Just not this peasant.
I suspect the stock will spiral down from here.
Meh. Hindsight and all that.
People said it about Apple, Amazon, and Bitcoin. Can’t know which ones that will happen with and which won’t.
Same here! I gave them a fake email and didn't want to do myself to them. Glad you brought that up.
On the desktop version of reddit you can click through the screen that asks for an email. I never gave reddit my email.
Had to make a new email for lemmy though.
I thought about it, and I refused on a moral ground to support reddit. It still may go up, despite everything.
Rich people don't usually have morals... That's the difference between us and them.
There are no guarantees an IPO will pop, even a buzzy one. Uber debuted at the low end of their estimate and trended downward, for ex, and didn't recover for over a year.
My instinct was that there would be irrational exuberance for the stupid stock. And ignored it.
The market is often pure speculation and gambling until the sobriety kicks in.
Anyway, I missed out on this one because of my caution and contempt for reddit. No point crying over it.
I bought put options on Monday. So far the stock is doing exactly what I thought it would do. I expect to see it at 25 a share before they expire in a few months.
I've got a single $35 p for 4/19. Didn't wanna go too nuts, I've seen plenty of shitcos reach ridiculous valuations after IPO like DASH, and then lose my ass buying puts waiting for the drop everyone knew was coming.
I was pretty confident this was going to follow the same path like what robinhood did when it went public and I threw a bit of heavier money at my confidence on it. Mine are $40 put options that expire mid July. Should be enough time to bottom out on the stock price before it starts to rebound and settle at closer to where it should be. Hoping to triple up on profits. Reddit owes me for the massive amount of ai data from comments I gave them. Lol
Be sure to keep track of your expected price change vs theta lost. Often selling earlier is just as good, after a quick move with higher volatility
Nothing made me wanting to spend time and effort generating free content more then the IPO.
Make your own damn money.
I feel like he is Ellen Pao-ing himself now.
His purpose is to implement all of the unpopular shit, take off with his golden parachute, and then a new CEO steps up promising better mod tools and maybe better performance in the mobile app. They'll make the users think Reddit is headed in a positive new direction with Huffman gone, even though all of it has been preordained and effectively nothing will change, but at least the users will have their bread and circuses.
Problem is Pao cracked down on the toxic hate shit that was making Reddit risky to invest in. It was controversial but ultimately a net positive for the community. Huffman is essentially selling seed corn by betraying developers and power users for short term gain (unfettered bot traffic, juicing native app usage, selling out to AI companies). A net loss for community morale and cohesion.
Ellen Pao was also the face of Victoria's firing (who was actually fired by Alexis Ohanian). Other events outside of Reddit (her failed gender discrimination lawsuit and her husband's own legal issues) also provided fuel for the then-nascent alt-right movement to position her as a feminist, POC bogeyman.
It is also hilarious reading the things she was vilified for back then. How quickly the "free speech absolutists" revealed their true colors when they tried to make their own platforms like Voat. I remember reading shortly afterwards how the sites became "taken over" by the alt-right as the MAGA crowd got more vocal, but the truth was they were there from the beginning.
I was the only leftist on voat. The website was okay. The people constantly reminded me why the working class must never disarm.
SocialistRA.org
Not only is bread not free, but it has increased 20-30% in price.
That's why the circuses have to be so ridiculous.
Trump vs Taylor swift? The writers are getting lazy...
His 500,000 class a shares were a part of the ipo offering, so they were directly sold with the ipo. He still has 4.1 million class b shares which have greater voting rights than class a shares. So the people in this thread saying he's sold all of his stock aren't correct, though he did sell all of his class a shares that are being traded in the public market for the ipo. It's all in sec filings as part of the ipo. You can see here who sold as part of the ipo and how much, and where all the ipo shares are coming from. Some were created to raise money for the company, others were already existing shares being sold by those who already held shares before the ipo. They wouldn't be able to sell after the market actually opened, that's where lockup periods come in, and it's 180 days in this case. The sale price of these shares was negotiated as part of the ipo before it was trading on the exchange. Now any still held are locked up for that period.
They wouldn’t be able to sell after the market actually opened, that’s where lockup periods come in, and it’s 180 days in this case.
That must be part of the amendments then, because when I looked at the Reddit S-1 about three weeks ago, the lockup for all share classes was at three days, very brief. I looked it up specifically because I wanted to know how soon Spez could get to the dump part of the pump-n-dump, and here we are.
I'm not an expert, I could be wrong or misreading it. The wording isn't straight forward. This is the section that mentions it:
In connection with this offering, we and all of our directors and executive officers, the selling stockholders, and certain other record holders that together represent approximately 82% of our outstanding Class A common stock and securities directly or indirectly convertible into or exchangeable or exercisable for our Class A common stock are subject to lock-up agreements with the underwriters agreeing that, subject to certain exceptions, without the prior written consent of Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, and J.P. Morgan Securities LLC, on behalf of the underwriters, we and they will not, in accordance with the terms of such agreements during the period ending on the opening of trading on the earlier of (i) the third trading day immediately following our public release of earnings for the quarter ending June 30, 2024 and (ii) 180 days after the date of this prospectus (such period, the “Lock-up Period”): (1)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right, or warrant to purchase, lend, make any short sale, or otherwise transfer or dispose of, directly or indirectly, any shares of our Class A common stock and securities directly or indirectly convertible into or exchangeable or exercisable for our Class A common stock; (2)enter into any swap, hedging transaction, or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of our Class A common stock, whether any such transaction described above is to be settled by delivery of our Class A common stock or such other securities, in cash or otherwise; (3)publicly disclose the intention to take any of the actions restricted by clause (1) or (2) above; or (4)make any demand for, or exercise any right with respect to, the registration of any shares of our Class A common stock or any security convertible into or exercisable or exchangeable for our Class A common stock.
If you control f to "lock-up" there's more context too.
Yeah, that's the section, at least for Class A. I think I'm the one who misread, and took "third trading day immediately following our public release of earnings for the quarter ending June 30, 2024" for "third trading day immediately following our public release blah blah blah" (the IPO).
I need to take more time when I'm sounding out the words, lol. Thank you for looking and taking the time to cite the section.
I've read it like ten times and am still a little confused, it is about as confusingly worded as possible I think, haha.
There is no ethical consumption under capitalism. Especially the consumption of free labor from commentors and moderators.