Sam Altman won big when the internet’s front page made its eye-popping debut on the stock market last week.
The OpenAI CEO isn’t just a fan of the newly-public social platform (although he’s written before about how he used the site daily for nearly a decade). He’s also a major investor in it.
Reddit’s IPO performance gives Altman one more reason to be a stalwart supporter — at least from his bank account’s point of view. Reddit’s value climbed near $10 billion on its first day of trading last Thursday, with the stock up 48% at market close. Its share price surged even higher Monday.
Altman has seen the value of his stake in the site rise 56% (or about $30 million) since the platform went public.
Altman and companies he owns or manages — such as the investment fund Apollo Projects and venture capital firm Hydrazine Capital — have invested over $60 million in Reddit since 2014. The AI magnate and his affiliated entities own about 12 million shares of Reddit, of which Altman personally owns about 1.7 million.
Altman’s investment should continue to pay off — that is, unless Reddit’s concerns about its meme-stocking members come to pass. The company said in its Securities and Exchange filing that users like those on r/WallStreetBets — who are known for short-squeezing companies like GameStop — could create volatility in its share price. But while Redditors have discussed shorting the company on r/WallStreetBets, short interest on Reddit won’t be public until April 9 at the earliest.
Reddit’s IPO surge
While a significant portion of newly-public companies fall on their first and second day of trading, Reddit’s stock is still up. In fact, as of midday Monday, the company’s share price was 56% higher than its IPO price of $34 — an anomaly in the world of IPOs.
And Reddit’s success isn’t just good for Altman: it’s good for the stock market writ large. The platform’s positive debut on the NYSE floor, coupled with the staggering gains reached by AI startup Astera Labs’s market debut last week, is a signal that the IPO market is finally making a comeback.
By the numbers
$9.97 billion: Fully diluted value of Reddit as of midday Mar. 25.
2014: Year when Sam Altman made headlines for his big personal investment in Reddit, leading its $50 million funding round.
$60 million: How much Altman’s entities invested in Reddit in 2021, U.S. Securities and Exchange Commission (SEC) filings show.
9%: Voting power of Sam Altman and related entities at Reddit.
1.66 million: Approximate number of shares of Reddit stock owned personally by Sam Altman, according to a Business Insider analysis.
56%: How much Reddit stock has risen from its IPO price of $34.