The social networking site Reddit recently announced it has obtained $50 million in outside funding, and disclosed its lead investor as Sam Altman, along with Alfred Lin of Sequoia Capital and Marc Andreessen of Andreessen Horowitz.
Snoop Dogg Among Investors Of $50 Million In reddit
The money will be used to hire more staff for product development, to expand the community management team, build better moderation and community tools, work more closely with third party developers to expand mobile offerings, improve self-serve ad product, build reddit gifts marketplace, pay for their growing technical infrastructure, and other various investments necessary to support a growing global internet community.
Altman is the President of Y Combinator, the incubator that originally helped launch reddit. He is one of the first reddit users, and a member of the same YC batch that Reddit founders Steve Huffman and Alexis Ohanian were in. Other recent investors include Peter Thiel, Ron Conway, Paul Buchheit, Jared Leto, Jessica Livingston, Kevin and Julia Hartz, Mariam Naficy, Josh Kushner, Snoop Dogg, and Yishan Wong.
Huffman and Ohanian claim they’ve been trying to find a way for the community to own a portion of reddit, considering that it’s their contributions that helped to anchor the site and give it strength. They have discussed ways to do this for years, but their backers always encountered legal obstacles.
However, Altman and the investors in this round have proposed to give 10% of their shares back to the community, in recognition of the central role the community plays in reddit’s ongoing success. Reddit claims they have to work out the details and will share more specific information soon.
Snoop Dogg, the hip-hop star from Long Beach, California, is among the group of investors financing this round for Reddit. The actor Jared Leto, who sometimes makes angel investments, also participated. According to The New York Times, Snoop Dogg’s participation was particularly meaningful for Reddit’s users.
Among celebrities who lead “ask me anything” discussion forums on Reddit, the rapper is especially popular, and eager to discuss marijuana, a topic that is a favorite among the site’s users.
“He’s like a Reddit superstar,” Altman said of Snoop Dogg. “The site loves him.”
When Altman made the initial offer to Reddit, he said he asked the company for a wish list of investors. “Snoop was high on the list,” Altman said. “We asked him to invest, and he said yes.”
Snoop has some previous involvement in technology. His app, Snoopify, lets people add stickers of joints, marijuana leaves and related paraphernalia to their mobile phone photos.
The Times notes that with the Reddit investment, Snoop Dogg was listed among Silicon Valley royalty, and he appeared to enjoy his new insider status.
When Mr. Altman ran an “ask me anything” forum on Reddit to discuss the investment, the most popular comment was by Snoop Dogg, who uses the handle “Here_Comes_The_King.”
“Whaddup Sam! They let the Dogg n the building,” he said. “Now do I get an official title??”
In 2005, Reddit was founded in Medford, Massachusetts by Steve Huffman and Alexis Ohanian, both 22-year-old graduates of the University of Virginia. It received its initial funding from Y Combinator.
The team expanded to include Christopher Slowe in November 2005. Between November 2005 and January 2006 Reddit merged with Aaron Swartz’s company Infogami, and Swartz became an equal owner of the resulting parent company. Condé Nast Publications, owner of Wired, acquired Reddit on October 31, 2006, and the team moved to San Francisco.
By the end of 2008, the team had grown to include Erik Martin, Jeremy Edberg, David King, and Mike Schiraldi. In 2009, Huffman and Ohanian moved on to form Hipmunk, recruiting Slowe and King shortly thereafter.
In July 2010, after explosive traffic growth, Reddit introduced Reddit Gold, offering new features for a price of $3.99/month or $29.99/year. Reddit Gold adds a number of features to the interface, including the ability to display more comments on a page, access to the private subreddit /r/lounge, and notifications whenever one’s username is mentioned in a comment. It’s also possible to endow comments or submissions of other users and thereby give a gold membership to them as an anonymous present.
On September 6, 2011, Reddit became operationally independent of Condé Nast, now operating as a separate subsidiary of its parent company, Advance Publications. On February 14, 2013, Reddit began accepting the digital currency bitcoin for its Reddit Gold subscription service through a partnership with bitcoin payment processor Coinbase.