The popular forum site Reddit has raised $50 million in funding and investors will share 10 percent of their shares with community members, CEO Yishan Wong said in a blog post. One plan is to create a cryptocurrency much like bitcoin to share with the community, but the site’s management has yet to nail down its final approach.
“We've long been trying to find a way for the community to own some of Reddit, because it is your contributions that help to anchor the site and give it strength,” the blog post read. “We think we've come up with a way. Led by [Y Combinator President] Sam [Altman], the investors in this round have proposed to give 10 percent of their shares back to the community, in recognition of the central role the community plays in Reddit's ongoing success.”
Other investors include actor Jared Leto, rapper and entrepreneur Snoop Dogg, PayPal co-founder Peter Thiel and gmail creator Paul Buchheit. Read the full announcement of the fundraising and sharing plan here.
Wong said Reddit’s lawyers believe the plan for a cryptocurrency backed by those shares is legal, but there are “30 different things we have to pull off to make this work.”
“We are thinking about creating a cryptocurrency and making it exchangeable [backed] by those shares of Reddit, and then distributing the currency to the community,” he said. “The investors have explicitly agreed to this in their investment terms.”
Wong said Reddit will hire more employees, beef up its moderation teams and develop new products in conjunction with third party developers.
Reddit went live in June 2005. It allows users to start their own “subreddits,” or sub-forums, for whatever topics they like, of which there are now at least 442,858. It had more than 135 million unique visitors in September. More than 3 million account holders were logged in as of Monday. Countless celebrities including now-investor President Barack Obama and actor Bill Murray have hosted “Ask Me Anything” sessions on the site. Some have stayed active members on the site, like Arnold Swarzeneggar, who regularly posts on Reddit’s bodybuilding forum.