Reddit (RDDT) went public on the New York Stock Exchange via an IPO on Thursday and closed its first full trading day on Friday, March 22nd. The participation of retail investors in meme stock trading, such as the surge in GameStop (GME) in early 2021, which the social media site’s “subreddit” or community page r/WallStreetBets helped fuel. So what do Redditors think about their favorite social platform choosing to go public?
Noor Al, head moderator at WallStreetBets, shares his thoughts on Reddit’s use of generative AI, the site’s profitability, and the community’s ability to engage with itself.
“This company is being held back by having to operate on a shoestring budget for basically its entire life. We have another $750 million in the bank, but how many more staff are we going to add?” Who knows what new features we’re going to have?’ We’re going to keep building more and more — I don’t think the sky is the limit,” Al says.
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Editor’s note: This article was written by luke carberry morgan.
video transcript
Josh Lipton: Reddit shares fell on their second day of trading, giving up some of the gains seen in their public debut. He tried to name companies whose customers can participate in IPOs along with institutional investors. Looking to the future, Reddit executives are looking to the company’s next steps with AI and advertising enhancements to stimulate user sentiment after the platform’s market debut.
Reddit user Noor Al is the head moderator of Wall Street Bets. Nur, nice to meet you. Perhaps you could start by explaining it to your audience. What exactly does a moderator do? What are their roles and responsibilities? So how long have you been doing this, Noor?
Noor Al: of course. Well, I’ve been a moderator on Wall Street Bets for about nine years. And really, the onus is on whether you’re building a bot to maintain the subchannel, or you’re just browsing the subreddit as a normal user, uploading things you like or dislike, or breaking them. It is as diverse as possible, such as whether to delete a comment or post. rule. It’s quite a mixed bag. But all of this is in his day job of promoting community and culture.
Julie Hyman: So, Noor, you’ve been on Reddit for a while, so you’re obviously a fan of Reddit. Do you think it’s a good investment for an IPO? And did you get the stock in the IPO?
Noor Al: I wish I could have gotten the stock at the IPO. I am Canadian. Therefore, it was not subject to DSP.
But many of my fellow moderators did. And congratulations to them. It’s up 30% since its entry. I think this is great for Reddit and great for Wall Street bets. I think the platform will become even more vibrant. And I’m really looking forward to seeing where this goes.
Josh Lipton: Why do you say that, Noor? Why are you sure it will become even more vibrant as you say?
Noor Al: This is because, basically, since its founding, this company has had difficulties because it has to operate on a limited budget. There are another 750 million people in banks and who knows how many more staff will be added. What new features are they going to build? I think the sky is the limit.
Julie Hyman: So what’s on your wishlist, as a moderator and as a user? What are some of the changes? Again, purely to your point, if money isn’t an issue So how do you make Reddit a better place?
Noor Al: In fact, I think Reddit has allowed us to build a lot of what we want to see. That’s why we’ve built a huge number of games and interactions for the community inside Wall Street Bets, including banned bets and user-generated sticky posts. These are all things Reddit has given us the ability to escape and do.
And now Reddit has announced something really cool. What no one is really talking about is that it’s a developer platform that will allow users to actually build apps within their Reddit. I think this will be the next big evolution of Reddit.
And again, no one’s really talking about it. This is a private beta version. And I think that’s going to completely change the way Reddit operates.
Josh Lipton: And Noor, I think part of the excitement about Reddit was the way it advertised itself as an AI play, Noor. The idea is that this will allow third parties to license access to data on the platform. As a moderator, what do you think about that strategy? Are you a fan of it?
Noor Al: I think this is great because it incentivizes Reddit to ensure that the content on its platform is actually by humans, that it’s actually authentic. Because as soon as that data is contaminated by other automatically generated content, the value of the entire dataset decreases. In short, this aligns Reddit’s incentives with its users’ incentives and maintains Reddit’s credibility.
Julie Hyman: But do you think that in some ways it’s like teaching AI how to replace it in the long term?
Noor Al: of course. Yes, that’s fine. I think the ultimate goal of Reddit, Google, or any of these information classification systems is to present the most relevant information to the user. And I think there are definitely places where you want to talk to humans and get their perspective. And sometimes you want to summarize the perspective of all humanity. So I think it’s actually a perfect balance.
Josh Lipton: Are you surprised, Noor? I’m just curious. You were the emcee there for a while. Were you surprised in any way when you looked at the company’s financials?
The company has been around for a very long time. However, he still posted a net loss of approximately $90 million in 2023. Noor, were you surprised to see that?
Noor Al: No, not at all. I think everyone knew that Reddit had been losing money every year for a long time. And I think that’s actually reflected in the fact that advertising on the platform is actually not that invasive and hasn’t been that invasive for a long time. Just within the last couple of years, we’ve transitioned from programmatic advertising to direct deals and seen a significant increase in revenue per user.
So they are definitely changing all the way in the right direction. He said one thing that surprised me, and there are actually two things, is how little revenue there is from Reddit Premium. Reddit earned just 2% of its revenue from premiums.
And two, we actually turned a profit for the first time in the fourth quarter of last year. That meant it was their first profitable quarter in his 20-year life.
Julie Hyman: Nour, I also want to ask you, you’re in on the Wall Street bet, but obviously we in the financial media started paying more attention a few years ago during the meme stock boom. Ta. How’s the mood these days? What are the hot deals? Can you give us some insight into Wall Street betting?
Noor Al: absolutely. Lately, there has been a lot of talk about AI and NVIDIA. We jumped on the bandwagon pretty early. Therefore, many people in the community have realized that they have benefited greatly from his NVIDIA.
There’s a lot of attention on this right now because of the Reddit explosion and this week being IPO week. However, at any given time, we always highlight the top tickers that are being discussed within the community. So today we focused on DWAC, NVIDIA, and Reddit. Those were the top three. And I think this is a very accurate representation of the average Wall Street Redditor’s bet.
Julie Hyman: That describes us well, Noor, because that’s also what we’re talking about today. Thank you very much. Thank you from the bottom of my heart. Have a nice weekend.
Noor Al: thank you. you too. cheers.
