How Sam Altman became one of Reddit’s biggest shareholders
Sam Altman, the CEO of OpenAI, is poised to cash in big time when Reddit goes public, thanks to his early and consistent investments in the online forum company since 2014.
Altman, who is also a former president of the startup accelerator Y Combinator, said in a 2014 blog post that he had been a daily user of Reddit for nine years, and that he believed in its potential to become “the most important site on the internet”.
He also revealed that he had invested $1 million in Reddit’s Series B round in 2011, and that he had bought more shares from other investors over the years. He said he did not care about the financial returns, but rather about supporting Reddit’s mission and community.
According to the regulatory filings accompanying Reddit’s announcement of its initial public offering (IPO) on Thursday, entities associated with Altman possess 8.7% of Reddit’s outstanding shares, including 789,456 Class A shares and 11.4 million Class B shares.
Based on Reddit’s estimated valuation of $15 billion, Altman’s stake could be worth more than $1.3 billion, making him one of the largest individual shareholders in the company.
Altman also sat on Reddit’s board of directors from 2014 to 2021, but stepped down last year to focus on his role as the CEO of OpenAI, the artificial intelligence research and deployment company that he co-founded with Elon Musk and others in 2015.
OpenAI is known for developing ChatGPT, a powerful natural language processing system that can generate realistic text on various topics and tasks. Reddit, which hosts millions of discussions and comments on its platform, sees ChatGPT as a potential competitor and threat, according to its IPO prospectus.
“ChatGPT and similar technologies may enable the creation of user-generated content that is indistinguishable from authentic content, which could adversely affect the integrity and quality of content on our platform and harm our reputation, user growth, and engagement,” Reddit stated.
However, Altman and Reddit’s current CEO, Steve Huffman, have maintained a cordial relationship and expressed mutual respect for each other’s work. Altman congratulated Huffman on Twitter for Reddit’s IPO announcement, and Huffman replied by thanking Altman for his support and friendship.
Reddit, which was founded in 2005, is one of the most popular and influential websites in the world, with over 50 million daily active users and over 100,000 communities covering a wide range of topics and interests.
The company plans to list its shares on the Nasdaq stock exchange under the ticker symbol “RDDT”, and expects to raise up to $1.5 billion from its IPO.
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