Profitable car rental service Turo is still ready for an IPO, but its growth cratered in 2023Turo, the venture-backed, peer-to-peer car rental service reported its fourth-quarter and full-year financial performance this week in an updated IPO filing.
The company has put the capital to good use, posting quick revenue growth since 2019, positive operating income since 2021 and net profit since 2022.
In 2021 Turo’s growth rebounded from 2020’s pandemic-driven woes impressively, rising 213% that year to $469 million.
However, triple-digit growth was short-lived at the car rental company, which saw its revenue growth slow to 59% in 2022 when it recorded $746.6 million worth of total revenue.
TechCrunch calculates that its Q3 2022 to Q3 2023 growth rate was 13.6%, while its Q4 to Q4 growth over the same time frame was a slightly sharper 14.3%.
If Reddit prices too high out the gate, it loses out on potential buyer interest and could trade down from its IPO valuation instead of building momentum.
Reddit’s most recent primary round in 2021 raised $410 million at a $10 billion valuation from investors, including Fidelity, Quiet Capital and Montauk Ventures, among others.
The market has obviously changed since then, and going out at that $10 billion valuation wouldn’t be smart.
What happens nextThe $5 billion valuation that Reddit may pursue is not risk-free.
Reddit offering shares to its top users is likely a ploy to avoid the stock entering meme-trading territory, Martin said.
Reddit users wonder if the next big meme stock is Reddit itself Reddit invites power users in on its IPO, but other Redditors are also considering an investmentJeremiah Johnson says he has “an embarrassing amount” of Reddit karma.
They’re also wondering if Reddit could be the next meme stock, which could prove lucrative or disastrous.
Though she wasn’t invited to invest early, she plans to buy stock in Reddit once it officially goes public.
“Reddit is really dependent on power users who moderate the site, and because they’ve given those power users actual power, power users did for a day or two literally make the site unusable,” Johnson said.
Max Spero, a startup founder in his twenties, plans to buy Reddit stock post-IPO because he’s a fan of the platform, which he’s been using for 11 years.
Hello, and welcome to Equity, a podcast about the business of startups, where we unpack the numbers and nuance behind the headlines.
Weekend team, we have something both short and sweet for you: A dig into the Reddit IPO filing that came out just after we recorded our final, regular episode of the week.
Since we could not wait until Monday to talk about the numbers, we have an overview here for your delectation.
If you want to read along:The Reddit IPO could be this year’s public-offering starting gun, or it could be a wet blanket on the year’s liquidity cycle.
We’ll see how it prices, and even more how it trades when it does list.
Reddit’s long-awaited IPO is nearing, promising to be the largest social media IPO since Pinterest.
Meanwhile, Mastodon, and the wider network of apps connected to the “Fediverse” as the decentralized social web is called, has a combined 17.2 million users.
Just as some Twitter users broke away to join decentralized alternatives, once they became viable alternatives, Reddit users could also do the same.
If Meta fears the power of decentralized social networks enough to join the movement, surely Reddit is not immune?
Seeing their demands ignored and overridden could eventually drive them to find new homes on decentralized social media, where they would maintain control over their communities and user data.
As Reddit finally files to go public, the company wrote in its S-1 filing that “meme stock” schemes on r/WallStreetBets could pose a risk to investors.
The stock was so volatile, jumping more than 600% within days, that trading was halted multiple times.
Retail traders tried to replicate the GameStop saga by investing in other heavily shorted stocks like AMC and Bed, Bath & Beyond, solidifying this phenomenon of trading “meme stocks,” to mixed results.
This is a rare move that would let community members buy stock at the same price as institutional investors upon IPO.
In 2023, Reddit incurred a net loss of $90.8 million, adding to the company’s cumulative deficit of $716.6 million.
Social media giant Reddit filed to go public today.
Today Reddit approaches the public markets with more than $800 million worth of revenue in 2023, up from $666.7 million in 2022.
In 2022 Reddit generated a net loss of $158.6 million, and adjusted EBITDA of negative $108.4 million.
That figure includes a massive $410 million Series F raised in 2021 and a smaller $368 million Series E raised earlier the same year.
That makes it worth roughly 7.5% of its 2023 revenue, a very nice tailwind for its 2024 results.
Hello, and welcome back to Equity, the podcast about the business of startups, where we unpack the numbers and nuance behind the headlines.
This is our Wednesday show, in which we talk through the week’s leading startup and venture capital news.
This is a short week, but there’s still a lot to talk about:We’ll be back Friday morning!
With governments tightening the screws on Big Tech companies trying to buy smaller firms, a key exit avenue could be closed to startups in the near term.
That fact makes Reddit feeling out its own IPO valuation all the more important.
What could help tech companies avoid another 2023 (a year that had precious few public debuts) is a massive, winning public offering.
Too high, and the stock could lose ground from its IPO price.
But private tech companies want good IPO news that sticks, and public market investors won’t gain confidence if Reddit clears a bar that it set too low.
India’s Swiggy to cut another 400 jobs ahead of IPO later this yearIndian food delivery startup Swiggy is cutting about 400 jobs, or nearly 7% of its workforce, as the startup seeks to bring further improvements to its finances ahead of a planned IPO later this year.
This is the second round of layoff at the Bengaluru-headquartered startup, which cut just as many jobs early last year.
The move comes as Swiggy attempts to further improve its finances.
Though its food delivery business is profitable, the startup is not profitable at a group level.
Zomato, Swiggy’s chief rival, became profitable last year.
