spez's comment "We’ll continue to be profit-driven until profits arrive. Unlike some of the 3P apps, we are not profitable." suggests a real concern about not being profitable. In fact, the whole ordeal reeks of panic – a last ditch attempt to right the ship before bankruptcy sets in.
There was once an age where investors would buy in simply on the belief of unicornedness, but that ship sailed several months ago. Investors have become much more critical of tech businesses, showing substantially less interest in tech companies that aren't displaying strong fundamentals. A recent Fidelity report indicates Reddit's own valuation has dropped by 41% on that change in sentiment.
There's no reason to buy's spez's words, nor any other executives in any company for that matter, their job is to spread a narrative.
In fact, if profitability was the goal, then he should have been ousted at this point, because he's been back for 8 years now without succeeding to make the company profitable.
I don't think he is that inapt, and that his board is stupid to let him in charge despite such a failure, profitability was just never the goal. Getting the biggest possible IPO is the goal, but the timing is actually very bad for them for the reason you mention and now they're trying as hard as they can, including by creating fake subreddits with translated old content for non-English speakers (at least French and German speakers).
> I don't think he is that inapt, and that his board is stupid to let him in charge despite such a failure, profitability was just never the goal.
Just fyi, reddit rose around the same time as Facebook so it’s likely they share a similar governance model, where founders control an outsized part of the board/voting shares. Since Uber and wework semi-imploded investors are less forgiving of that sort of thing but legacy companies like Reddit likely still are run that way.
Spez sold his shares in 2006 before joining back as a CEO in 2015. He probably has equity as the CEO, but not as many as a regular founder and as such he should have much less power and control over the company than Zuck.
There was once an age where investors would buy in simply on the belief of unicornedness, but that ship sailed several months ago. Investors have become much more critical of tech businesses, showing substantially less interest in tech companies that aren't displaying strong fundamentals. A recent Fidelity report indicates Reddit's own valuation has dropped by 41% on that change in sentiment.