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The online platform said it plans to invest in consumer products and double its employee headcount this year.
Now in its 16th year of operation, Reddit has raised a new Series E funding round from new and existing investors, totalling $250m.
The latest funding follows a flurry of public attention for the online platform, after users on the Reddit forum r/WallStreetBets took on hedge funds by pushing up GameStop stock in a coordinated effort.
In a blog post on Monday (8 February), Reddit said that now is the right time for the company to make “strategic investments in Reddit including video, advertising, consumer products and expanding into international markets”.
In December 2020, Reddit acquired Dubsmash, a short-form video social platform and competitor of TikTok.
Reddit CEO Steve Huffman has been critical of TikTok in the past. During a panel discussion at a Silicon Valley conference last year, he described TikTok as “fundamentally parasitic”.
Reddit’s Dubsmash acquisition could be a sign of a more direct fight for a share in the video market. The company’s latest blog post specifically mentioned this acquisition, adding that it will help “bring highly polished video creation tools” to Reddit’s platform.
“We continue to invest in building and improving the ways people on Reddit connect – whether that’s traditionally through text-based discussions or through video or live streaming,” it said.
The latest round of funding doubles Reddit’s valuation to $6bn. The company has raised around $800m to date, including a $300m Series D funding round in February 2019 led by Tencent.
As well as investing in products and international expansion, Reddit also said it plans to double its number of employees this year. Last October, the social platform said that its US employees will have the option to work from home, in the office or a combination of both, without taking a hit to their salary.
The company, which has more than 50m daily users, said its direct advertising revenue increased 90pc year on year in the last quarter.
