The folks at Collaborative Fund certainly like a challenge.
Oh, and they decided to raise their sixth flagship fund at a time when limited partners have grown more miserly.
Collaborative recently raised $125 million for its sixth flagship fund, the firm exclusively told TechCrunch, completing the process in just over 90 days.
“This fundraising environment is tougher than any I’ve seen since starting the firm well over a decade ago,” founder and managing partner Craig Shapiro told TechCrunch.
Part of that could be the fact that Collaborative has recently returned capital to its LPs, Shapiro said.
After its IPO, the platform is planning a slew of product features for the year ahead, and — spoiler alert — most of them are powered by AI.
“I think the IPO was an important milestone, but we’re just focused on building for our users,” Reddit Chief Product Officer Pali Baht told TechCrunch.
Reddit’s product roadmap includes faster loading times, more tools for moderators and developers, and an AI-powered language translation feature to bring Reddit to a more global audience.
According to Reddit’s IPO filing, in December 2023, 50% of Reddit’s daily active unique users were from non-U.S. countries.
The company will build on those updates with other new tools, like an LLM that’s trained on moderators’ past decisions and actions.
Vana plans to let users rent out their Reddit data to train AI A startup, Vana, says it wants users to get paid for training dataIn the generative AI boom, data is the new oil.
“It does this by allowing users to aggregate their personal data in a non-custodial way … Vana allows users to own AI models and use their data across AI applications.”Here’s how Vana pitches its platform and API to developers:The Vana API connects a user’s cross-platform personal data … to allow you to personalize your application.
This month, Vana launched what it’s calling the Reddit Data DAO (Digital Autonomous Organization), a program that pools multiple users’ Reddit data (including their karma and post history) and lets them to decide together how that combined data is used.
We have crunched the numbers and r/datadao is now largest data DAO in history: Phase 1 welcomed 141,000 reddit users with 21,000 full data uploads.
“Reddit does not share non-public, personal data with commercial enterprises, and when Redditors request an export of their data from us, they receive non-public personal data back from us in accordance with applicable laws.
Reddit sold $203 million worth of contracts to AI companies for access to its data earlier this year.
In the wake of a compression in tech valuations since the implosion of the 2021-era asset bubble, few tech companies have tested public markets.
Early trading results do not always augur a trouble-free public market life, however.
Secondaries investors recently told TechCrunch that they weren’t sure that a successful Reddit IPO would be enough to bring life back into the IPO market in 2024.
But with Astera Lab’s impressive performance yesterday and Reddit’s strong showing today, maybe there will be more life in the IPO market this year than many thought.
Reddit prices IPO at $34 per share, the top of the rangeReddit priced its stock on Wednesday at $34 a share, the top of the anticipated range, a signal that investors are excited about the company’s IPO on Thursday.
The social media giant raised nearly $500 million in the offering.
Despite being profitable on EBITDA basis, Instacart and Klaviyo, two main IPOs of 2023, had lukewarm receptions on Wall Street last year.
But Reddit is still generating net losses of more than $90 million, which may bode poorly for the company’s stock amid push for profitability for newly traded companies.
The firm sold $203 million worth of contracts to AI companies for access to its data in January, according to a recent filing.
Reddit is introducing a new ad format that looks similar to posts made by users on the platform, the company announced on Thursday.
The new ad format, called free-form ads, is designed to feel similar to the content that users share with each other in order to help advertisers get maximum engagement.
Although the new format may be enticing to advertisers, ads that look like regular posts may not be a welcome addition for users.
The company says the new ad format would be a good way to do things like launch a product or introduce a brand to a new audience.
Similar to other ads on Reddit, users will be able to differentiate between free-form ads and regular posts through a “Promoted” label displayed next to the company’s name on a post.
The long-running dearth of IPOs could be coming to a close, partly due to Reddit’s upcoming public debut.
Expected to list this month, Reddit saw its valuation soar during the pandemic.
If Reddit’s IPO does well, it could wiggle open the public-offering window just a little bit wider than we’ve seen in quarters and quarters.
Of course, the public offering could also fizzle out like an unpopular opinion downvoted to hell on the site.
But with an AI-friendly growth story to tell, Reddit may have timed its ramp towards the public markets just right.
At the low end of this range, $31 billion, though Reddit would be worth $4.93 billion based on an expected 158.98 million shares outstanding.
With $804.0 million in 2023 revenue, Reddit is on track to trade for a multiple of 6.9x to 8.0x its revenue, depending on the valuation estimate you want to use.
Reddit’s game plan for AI is one good reason why it’s pricing its shares closer to Meta than Snap.
Reddit data constantly grows and regenerates as users come and interact with their communities and each other.
Investors might consider Reddit a side-bet on AI itself, even if the company’s core business isn’t creating AI models.
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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 Monday show, in which we take a look back at the weekend and what’s ahead in the week.
Over the weekend, we dropped an interview with Roger Lee that is well worth your time, and here’s our take on Reddit’s IPO financials.
Here’s what we got into today:
In a new SEC filing, Reddit says it’s planning to sell around 22 million shares, priced between $31 to $34, potentially raising around $748 million at the high end of that range.
But the IPO could be volatile given that Reddit will allow its community members to sell their shares immediately, instead of being subject to the usual lock-up agreements that typically prevent investors from selling shares for six months after the IPO.
The move sets up Reddit to become a meme stock — a term coined in reference to the wild GameStop short squeeze of 2021, which was driven by a group of Reddit users on its community r/WallStreetBets.
The users had taken on the hedge funds that had shorted GameStop’s stock by over 100% by working collectively to buy the stock.
By allowing the Reddit community to buy into the IPO, there’s again potential for the stock to be manipulated — this time, possibly in Reddit’s favor — by Redditors’ collective action.
