Reddit is used to brawls between its 57 million daily users. Now its keyboard warriors are directing their ire at its CEO, Steve Huffman. Thousands of moderators overseeing the site’s so-called subreddits are on strike. It’s a wrinkle in Reddit’s plan to go public, and a sign that plan is premature.
This article from TechCrunch had a line that really confirmed some suspicions I’d had about this:
If you thought Reddit’s absolute refusal to do anything in light of all the bad press was borderline sociopathic, there you go. Spez is taking all of this personally.
There was a way for everyone to win here, given some concessions. Yet no. Huffman decides to go nuclear with the API pricing to try to maximize profitability. This seems to tell me that the way Reddit was sold to investors it was way over valued.
YET, I still firmly believe that Reddit does not know what to do with its user data, or has not figured a way to conveniently, and concisely package it in any usable manner. As is, Reddit should be profitable based on the data users provide. Facebook does it with user data and remains free to use. This might explain some of the weird development choices Reddit has made over the years with new Reddit and the mobile app. They’re trying to shoehorn users into a system that allows their data to be usable, yet a large portion of the user base hasn’t followed along. They’ve utilized RES. old Reddit, and 3rd party apps instead of the official app which tries to compile user data into something that can be more easily packaged into something that can be sold to advertisers.
Now they’re on their 3rd year trying to go public, and they haven’t made measurable progress. Investors are waiting for their return, and Huffman is under the gun to produce some measured result…hence the API pricing and this nuclear option.
It’s a nearly 20 year old company that does not have a financially sustainable, robust business model (contrary to lemonade stands). It might be profitable, despite what they claim, but they are still just shooting in the dark, randomly iterating ideas.
These leaders are fucking jokes, they wouldn’t get hired as junior analyst at any consultancy/bank.