Pod Insights The Prof G Pod with Scott Galloway First Time Founders with Ed Elson – The Story of Reddit About this episode Live from YPO’s Global Entrepreneurship Summit, Ed sits down with Reddit co-founder and CEO Steve Huffman. They discuss the company’s IPO journey, his unique approach to investor relations, and how Reddit navigates the complex world of content moderation.
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Transcript Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
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0:35 Ed Elson? Thank you, brother. Hey, how's it going? Good to see everyone. Thank you all for being here. And thank you to YPO for putting this on. I think we're recording right now. So just so you all know, this is a live podcast recording as we speak. It's really great to be here. I want to thank the Global Entrepreneurship Summit for putting this on. Thank you to the Palace Hotel for making this all possible. I'm just going to bust right into it because I have one hour and I want to get as much as I can out of the man who's about to walk on the stage here. And we're going to start with just a little introduction, which is something we usually do on this podcast. So in 2005, my next guest had a simple idea to create an online bulletin board where
1:20 Ed Elson? anyone could share links, ideas and conversations. He was 21 years old at the time and within a year, he sold his idea to Conde Nast for $10 million. What happened over the next two decades defied all expectations. After leaving for several years, he was brought back to the company and under his leadership, this once scrappy website transformed into a behemoth, going from $12 million in revenue to a billion dollars in revenue. It's now a vast ecosystem of more than 100,000 active communities, covering everything from breaking news and niche hobbies to pop culture and global markets. And now with nearly 400 million weekly active users and more than 22 billion posts
2:05 Ed Elson? and comments today, this is no longer just a website. This is a cornerstone of our digital age. So please join me in welcoming the co-founder and CEO of Reddit, Steve Huffman.
2:22 Ed Elson? Thanks. All right. So I just got to tell you before we get into this, I am a huge fan of Reddit these days. I got into Reddit probably five years ago during the pandemic. I was living in my mom's basement. I was actually a senior in college at the time and I had nothing to do but go on Google and look at Wikipedia pages and just get interested in very weird nerdy things. And I found Reddit and it became almost like an escape for me. It was honestly a really big part of my life at the time. And I mention that because I think Reddit is the same for millions of people around the world. It's a place to socialize, but I think for many, it's also in a lot of ways an escape.
3:05 Ed Elson? So I want to thank you for creating Reddit and I want to thank you for being here.
3:09 Speaker 02 Thank you. And I just want to thank you for, you know, solidifying the stereotype that our users are all joining us from their mom's basement.
3:24 Ed Elson? Well, I got out of her basement and I still use, I'm still a power user. We all have to start somewhere.
3:29 Speaker 02 We'll take it. And thanks for having me here today, folks.
3:33 Ed Elson? So this is going to be a regular first time founders episode as usual, but we've also collected some questions for you that we gathered on Reddit. So I'll be doing a regular interview, but we'll also sprinkle in some of those questions as well. And I want to start at the beginning. The year is 2005. You're a senior at the University of Virginia. You're studying computer science and you and your roommate Alexis Ohanian have this idea not to start an online message platform, but to start a food delivery app.
4:08 Ed Elson? Which is strange. So tell us the story of Reddit. How did we get here?
4:12 Speaker 02 So, yeah, this was early 2000s. I had had this idea of people ordering food from their cell phones, which I think would later become a good idea. You know, DoorDash and what have you. But back then, there were some pretty big limitations on it. One is not everybody had cell phones. Two, cell phones didn't really run software. And three, restaurants weren't on the internet. Nevertheless, so something we pursued and that led us to Y Combinator. And so Y Combinator had kind of during this beginning part of the story became.
4:55 Speaker 02 Y C didn't exist at the beginning. A few weeks later, after we met Paul and the team, Y C did exist. We applied with a food idea, but we were ultimately rejected.
5:05 Speaker 02 But Paul and the Y C teams, this is Paul Graham and the Y Combinator team invited us back to basically figure out what else we could work on. They liked us, but not that idea. And so that something else would end up becoming Reddit. And so I think it was a good call on Y C, I hope. One, on not doing a food thing and two, on bringing us back. It seemed to have worked out for everybody.
5:30 Speaker 02 But I think it goes to show that, you know, ideas are not necessarily the hardest part in getting things off the ground. I think great teams can bring, can do a lot with many ideas and not great teams can, you know, ruin the best of ideas. And it's really hard to tell in the beginning what's a good idea and what's a bad idea. And the food, the food one's a great example because, you know, we could argue both sides of it. I don't know if it's a good idea eventually. I don't know if it was a good idea then. I don't know if we would have been able to get that one off the ground then.
6:06 Ed Elson? Yeah, you mentioned Paul there. And for those who don't know, Paul Graham is the founder of Y Combinator, legend in Silicon Valley. And it is so interesting that you went to Paul and you had this idea. He said, no, but then he said, but come back and let's do something else. So what do you think Paul saw in you? And how influential was he in starting this company?
6:31 Speaker 02 One part of that story though is before Paul said no, he said, why don't you come pitch the food idea? Because he had given a talk at Harvard called "How to Start a Startup." Yeah. And so after that talk, we met Paul and pitched him on the food idea, and he really liked it. And then he started Y Combinator, and he invited us to interview, and then he said no. So it was a little bit of a journey there.
6:55 Speaker 02 And so when we had come back to brainstorm new ideas, the start of the conversation, there's kind of two sides to it. So Paul was a big fan of a website at the time called Delicious. Delicious is no longer around, but back in that era, it was a website for bookmarking. So a website for bookmarking other websites. Delicious was a neat product. It also, among other things, invented the idea of the hashtag as a organizational thing. But the problem with Delicious is you bookmark things that are boring, that you want to come back to later. So it's like things, "I can't finish reading in one sitting," or "I want a reference later."
7:40 Speaker 02 And so Delicious had this side effect, or had this page called Delicious Popular, that would show the most commonly, things most commonly bookmarked. And so it was a really interesting dynamic of kind of interesting links on the internet that were too boring or long to read in one sitting. And so Paul was like, "Well, what if there's something like Delicious, but the content was good?" That was kind of half the idea for Reddit. And the other half of the idea was from Slashdot. And so I was a big Slashdot user. And Slashdot's still around. You can go to Slashdot.org. The website is a list of links, basically, headlines, to tech news.
8:22 Speaker 02 But what was really magical about Slashdot was the community that lived in the discussion about the news. And the news was really just the prompts for conversations. And so it's really these two ideas. This kind of like bookmarking, user-powered, dynamic platform with a community that lives in the conversation about these things. And so that really was the genesis of what would turn into Reddit. And that really still is the core of Reddit today, which is communities of people having conversations about things on the internet.
8:54 Ed Elson? So you start the company, around 12 months go by, things are going well. And I don't think people realize this, but you sell the company. And I would call that an extremely early exit. You stick around for a few years, but take us through your decision to sell. Why did you sell the company so early on?
9:16 Speaker 02 Paul started a company in the bubble called ViaWeb. ViaWeb pioneered e-commerce. He got bought, their company got bought by Yahoo, it became Yahoo's store. And so it was one of the first kind of big e-commerce plays on the internet. And Paul would write essays talking about startups and evangelizing startups as a path to creating wealth. And so that was kind of the spirit of Paul and the spirit of Y Combinator is you start a company, you know, your advantage is you can, you're young, you can work really hard, you don't have any preconceived notions about what products should or shouldn't exist. And the end of the story is, and you sell your company to a bigger company.
9:57 Ed Elson? Yeah.
9:58 Speaker 02 And so that was just kind of the prophecy. And so in Y C, we started this thing Reddit. And then Conde Nast, also known as Advance, I'll use those words interchangeably, but Advance is the technical name of the parent company, offered to buy us. And so we thought we were just fulfilling the prophecy. And when we ultimately, you know, when the offer came in, I was still 21. I didn't know. What success looked like? The advice I'd give to founders now is never sell a winner. But I didn't, Reddit didn't feel like a winner to me. I think if we went back and looked at our numbers, it would be, there'd be signs of that, like we were growing and we didn't know why.
10:43 Speaker 02 That's a great sign, right? If you have so much product market fit, you don't know why your product is working.
10:49 Speaker 02 But we didn't really know that at the time. At the time, it felt like we were dysfunctional internally.
10:57 Speaker 02 We didn't really know what to do. We didn't really know how to fundraise. There's just so much, I think, ignorance and naivete that like when a company came and offered us real money for this thing, we're like, we would be really silly not to take it.
11:10 Ed Elson? Right.
11:10 Speaker 02 And I think we would have been silly not to take it. We didn't know what we were doing yet. And so our time at Advance, Advance is still our largest shareholder. Our time at Advance for the next three years after that acquisition, I think actually gave Reddit and we as individuals time to mature a bit,
11:31 Speaker 02 which in hindsight, I think worked out really well.
11:34 Ed Elson? Yeah, so you, you, you stick around for a while. You end up leaving in 2009. And then during those six years, Reddit is growing and growing and growing. And then things start to get a little bit controversial around the company. There were issues with content moderation, issues with censorship. While you're gone, some members of, core members of the team were fired. The then CEO, Ellen Pao, was under a lot of scrutiny. And then you come back in 2015. Give us a sense of what happened in those six years and tell us the story of returning to the company as CEO.
12:14 Speaker 02 So during that time, so this is basically 2010 to 2015.
12:20 Speaker 02 I had left to start a different company, completely different company, called Hitmonk. We were doing travel search. Couldn't be more different. Reddit spun out from Advance, which basically meant Reddit became an independent company again, had some cash on its balance sheet, had stock that can pay employees with. It was one of the big challenges I had during the acquisition years, was we couldn't recruit with stock. So we were recruiting against other tech companies, but basically to be an employee without equity. And so that was really difficult. And so they realized that, and so they gave Reddit its own cap table again. Reddit grew, continued to grow.
13:03 Speaker 02 Reddit brought in a couple external CEOs. And then Reddit started to be tested on the content policy side. Now, in the early days, so call it, I kind of that first Reddit era, the first five years or so, our content policy was we don't take things down. And this was kind of the founding principle of Reddit, which was we didn't want to be the gatekeepers. We didn't want to be the deciders of what people can say on the internet. That was kind of the reason we started Reddit. The alternative was news, or even platforms like Slashdot, where there were editors. So there were gatekeepers, and we're like, we're not the gatekeepers. Now, that was a relatively easy position to take,
13:48 Speaker 02 because we didn't have much to take down. Right. And so more difficult decisions about which content should be allowed or not, they weren't really on our radar. You know, most of this stuff was like, there's like swear words, some edgy content, and lots of stuff critical of Reddit. But the content challenges we'd face later, around, you know, just kind of, call it generally bad behavior, weren't really an issue for us. And in that time when I was gone, it became an issue. And the challenge the company faced is, and I learned this when I came back to the company in 2015, and I was talking to folks, I was like, why aren't you doing anything?
14:34 Speaker 02 And they're like, well, we don't know what to do. Or rather, it was like, we're afraid if we do anything, we're gonna break Reddit. We don't know how Reddit works. We don't know why Reddit works. And if we make any change, we're afraid we're gonna break it. Right. And it was really challenging culturally. Because Reddit was in the press for all of the wrong reasons. So this is like 2015. In the press for all of the wrong reasons, as being like a bad player on the internet. And it was really demoralizing for the team. There was about 70 employees at the time. They were really demoralized. They wouldn't wear their swag. Recruiting was really tough. We would actually call people and they would laugh at us sometimes or get offended. Like, how dare you suggest that I'd work at Reddit?
15:15 Speaker 02 And
15:17 Speaker 02 and I remember asking employees at the time, it's like, if this is so difficult and you're so unhappy, why are you here? Yeah. And they'd say, well, because I love Reddit. And I know Reddit's really special. And, you know, Reddit's played a really important role in my life. Some of them would say, I met my spouse, who by the way, also works here on Reddit.
15:39 Speaker 02 And
15:42 Speaker 02 and that's, and I would say, well, that's why I'm here too. Because we knew it was really special. And though we are in the press for all of the wrong reasons,
15:50 Speaker 02 it was still a minority of the content on Reddit. But it happened to be the stuff that was on the front page and getting picked up on. And it was like, you know, the other 99% of Reddit was really amazing. I think really showing off the best of people and the best of humanity. And so, well, I said, look, it's, it's not, if we change, we'll die. It's, it's, if we don't change, we will die. By the way, we're dying. Like, that's why I'm here. This thing is dying. And it would be a real shame if it died. Yes. So we need to make some changes. And so that's when we created our content policy. The content policy was basically nonexistent. Created the content policy, wrote the first version of the rules, created the safety team, started enforcing those things. And it was a process
16:37 Speaker 02 that we had to go through publicly and with the community of drawing the line, figuring out where the line is, figuring out how to articulate it. And look, it's a journey we're still on.
16:49 Speaker 02 But I think it's, it's a, it's a I think us being able to navigate that, I think in a very human, authentic way, has allowed Reddit to grow into what it is today.
17:03 Ed Elson? Yeah, I mean, that was 10 years ago. It was doing 12 million in revenue. Fast forward to today, a billion dollars in revenue, sitting at around a $20 billion market cap. Today, you just IPO'd. We'll get to that. And we'll get to the content moderation as well, which is important. But if you had to give us a few of the main changes that you made in this past decade, when you came in to today, what would you say are the biggest changes that you made that had the biggest positive effect on the company?
17:33 Speaker 02 There are a lot. The big ones, the big ones I think are true, are relevant to any company. Maybe all of these are relevant to any company. The biggest one is we have to use some common sense. And so this is back to the story I was just telling, which is it's not change, change and die, it's change or die.
17:55 Ed Elson? Right.
17:56 Speaker 02 And asking the question of what is this platform for, what experiences do we want people to have on it, and what do we need to do to get to the best version of ourselves? And you have to be willing, I think, to throw out things that you once believed. And you have to be willing to evolve and grow and look at the world through the lens of reality, not the lens that we maybe had when we started the company, you know, whenever that was 10 years prior. And that's still something I tell the company. It's like you have to have common sense, you have to use good judgment, and you have to think about like, is this product good? Is this a place people want to be? What is the difference between where
18:39 Speaker 02 we are and where we want to be? And you have to be willing to change things to get there. That's the biggest one. It's just common sense and being practical. Another big change for Reddit was we weren't running as a business. We were really idealistic, and I think in many ways, the idealism has been very good, but we're also...
19:04 Speaker 02 Idealistic about not being a business, which is not a great way to run a sustainable business. And so we had to figure out, okay, what is our business model? And it would be ads. And how are we going to do this in a way that fits with, you know, what we want this platform to be, fits with our values? And so forth. And then there was some kind of similar minded things, which is like the company just wasn't, they were so afraid to make changes and to ship. And that wrapped up in some of that idealism was also like not working very hard. You know, and it's just like, look, we have to work really, really hard. We're in a competitive space. What we do is really important. We want to be successful.
19:47 Speaker 02 I think what Reddit provides people, the sense of community and belonging is really important. And if we don't work really hard and work really smart and make this thing successful, both from a user's point of view and business point of view, then we don't get to do this and we'll never achieve our mission. And all of these high minded things we love about Reddit, the way it enriches people's lives and provides people a glimpse of into humanity you wouldn't otherwise see and now serves as a knowledge source. They won't exist if we don't build the foundation.
20:16 Ed Elson? Do you think this is still a problem today in tech? I say that because I kind of think it might be where tech companies are too idealistic. They don't think of themselves as businesses. They think their mission is something larger than that. And it detracts from the ability to grow as a company. Because people are too interested in the idealism versus essentially the revenue in the bottom line. Is that something that you notice in Silicon Valley today still?
20:45 Speaker 02 There are shades of that. I think there's nothing wrong. And I don't think they're really in conflict of having a big mission. Right for our, for us, it's to empower communities, you know, and make their knowledge accessible to everyone. There's nothing wrong with having a big inspiring mission. Not only nothing wrong, it's in my opinion, required.
21:04 Ed Elson? Right.
21:05 Speaker 02 That doesn't come at the expense of building a business.
21:08 Ed Elson? Yeah.
21:09 Speaker 02 Building a business is required to achieve the mission. Right to do anything at world scale, you need world scale resources. And so you can't fundraise your way to doing something world scale indefinitely.
21:22 Ed Elson? Right.
21:23 Speaker 02 You know, maybe there's some AI companies proving to the contrary in the short term. But at some point you have to be self sustaining.
21:29 Ed Elson? Yes.
21:30 Speaker 02 The other thing that I've seen, though, in the Bay Area broadly is
21:38 Speaker 02 it's almost an entitlement of, you know, I work at these companies, but I don't have to work very hard and I'm here for myself.
21:50 Speaker 02 And almost sometimes taking, I think,
21:56 Speaker 02 taking ideas from other successful companies and perverting them. So here's one that I used to see a lot is Apple had this philosophy of like, it's done when it's done. Right? You know, they externally, I don't know about internally, I've never worked at Apple. Externally, you know, they wouldn't have deadlines, they would build these beautiful artisanal, you know, best in the world products and ship them when they're ready.
22:26 Speaker 02 Great, right? And they had hit after hit after hit after hit. But then I would hear this from engineers who are like, I'm like, when is this going to be done? And they'll say, well, it'll be done when it's ready. Okay, but like, when is it going to be done? Well, it'll be done when it's ready. But then the version I get isn't this artisanal world-class product. It's like late and shitty. And I'm like, you're not Apple. Like, I don't know what Apple's doing over there, but we're not Apple. You're not Apple. I'm not Apple. Like, so. And so I remember having versions of that, you know, that conversation. And I did this as an engineer too. I was like, well, don't rush me. I'm the artist, you know? It'll be done when it's done. Now it's more like, okay.
23:04 Ed Elson? Yeah.
23:04 Speaker 02 What can we do in a week?
23:05 Ed Elson? Exactly.
23:05 Speaker 02 Let's get this thing, get this thing rolling. And so that's part of honestly, I think, not just the company's maturation, but my maturation along with it and our team's maturation, you know, over that story as well. But I've just seen so many startups with that mentality over the years.
23:24 Ed Elson? We'll be right back.
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24:41 Ed Elson? We're back with first-time founders. Let's talk about the IPO. So Reddit went public in March of last year. The issuance price was $34 a share. It's now sitting at around $100 a share. So it's been a pretty good year for you.
24:57 Speaker 02 It was this morning.
24:58 Ed Elson? It was this morning. Things are changing. Last I checked, you're at around 100. What have been some of the main learnings about going public? What are the biggest differences between running a private company versus now, today, running a public company?
25:17 Speaker 02 The biggest differences are really obvious. We have a public share price. We have certain requirements that we have to live up to in terms of disclosures and transparency and so forth. And we have now a massive shareholder base versus having just a handful of private institutional investors. Now...
25:49 Speaker 02 Because of all of those requirements, we are a better business, for sure. I think the public company quarterly rhythm of saying what you're gonna do, doing it, hitting your numbers, closing the quarter, doing the audit, no fuck-ups, doing the board meeting, the earnings call, and then for us, we do some extra stuff. We basically do a whole nother earnings cycle with our user base.
26:18 Speaker 02 That rhythm, and talking to our investors, and talking to our retail investors, our user investors, has without a doubt made us a substantially better company. It just raises the bar. And I think we make better decisions now, we communicate, you know, we articulate our strategy better, we work harder. And I don't know whether it's the sense of duty to our shareholders, to our user shareholders, the fear of failure, the desire to succeed. It's actually all of these things. But they've all, I think, created an environment where we're doing the best work that we've done.
27:00 Speaker 02 And then, as I've said almost every day for the last 10 years since I returned to Reddit, we can be so much better. We can be so much better, and I think we have a duty to our users, to our employees, to our shareholders, to be as good as we can be.
27:17 Speaker 02 And so, yeah, there are aspects of it that can be more challenging, you know, like turbulent market times, like today.
27:25 Ed Elson? For those who are listening on the podcast, on the audio, the tariffs just went into effect.
27:30 Speaker 02 Today's liberation day, where we're liberating Americans from their wealth.
27:40 Speaker 02 But...
27:43 Speaker 02 You know, but honestly, I'd rather have the up-to-date mark than when we're a private company, you don't really know your valuation and you have no liquidity and you can't use it. So I think, yes, there's some burdens that come along with it, but I think that the environment and the requirements and the high standards have been really good for us.
28:07 Ed Elson? You mentioned you do this second earnings call. I find this so interesting. I'm obsessed with this. You have this very strange approach to investor relations, which I love. You do your regular earnings call, but then after the regular earnings call, you go on to Reddit and you do a second earnings call, which is basically an AMA, like an Ask Me Anything. And you'll take questions from all the users of Reddit and they'll ask you everything about the company, which to me is the way that we should be doing investor relations today. I find the regular earnings call is boring, it's uninteresting, I don't care, the analyst questions are uninteresting to me. I think what you're doing is engaging with the user
28:49 Ed Elson? base in a very different way. Why did you decide to do that? And just take us through your approach to investor relations more generally.
28:57 Speaker 02 Let me just zoom out for a second and talk about Reddit. Reddit is a user-powered platform. Our users have created everything that's interesting about Reddit. We technically, we built a very simple platform for creating communities, submitting posts and ranking those posts through voting and having conversations in the form of comments. What our users have done is created thousands of communities for every topic imaginable, whatever you're into, whatever you're going through. And I think it's truly special. It's the most human place on the internet. And our users feel...
29:39 Speaker 02 Rightly so, a deep sense of ownership over what they've created in Reddit. Their communities are their home online and sometimes much more than that. And so I wanted that sense of ownership to be actual ownership. And so one of the reasons we went public is I thought being public actually fits the spirit of Reddit. Right? Transparency and public ownership, like those are really important concepts to Reddit. And so we wanted our users to be, or have the opportunity to be owners, shareholders. So throughout the entire IPO process, from including our user base in the IPO, as in
30:23 Speaker 02 we made it accessible to every user of the platform to buy Reddit stock at the IPO price. Not the first trade price, but the price that we sold stock to, to the bankers and professional investors, we also sold to our users. So that means they, everybody, every user who took advantage of that got to enjoy the pop. Right. Which is not usually the case in an IPO. Usually retail comes in after the pop, which is why the pop feels so unfair. So we said, we want to bring them in at the pop and we want to give them as much information as we can, the same way we would to the professional investors, so that they can make smart decisions
31:08 Speaker 02 there, or make the best decisions for themselves. So we did that in the IPO process and we continue to do it every quarter now. So we do our earnings, we do our investor callbacks, and then we go onto the platform and we solicit questions from the community, every earnings, and then we answer as many of those questions as we can. So I, our CFO Drew, and our COO Jen. We try to do it in one take. We'll do a 30 minute to an hour, one take. We'll just rip through as many user questions as we can and giving them the most fulsome answer that we can. Their questions.
31:48 Speaker 02 I do think yes are a little more interesting than what we get on the earnings calls. And I think both are valuable though, so we get a lot of the kind of technical quarter to quarter. You know, what's your revenue, what's your traffic, what's the next quarter going to look like calls on the earnings calls? And then from our users, so like, why'd you fuck up this feature and like, what are you doing next? And like, blah, blah, blah, it's like, super interesting stuff. And I really enjoy doing it. I love talking about Reddit.
32:13 Speaker 02 And we're seeing traction in that community pick up, so we've been doing it a year. And we'll just keep, you know, we'll just keep, we'll keep doing that. I think it's the right thing to do and it's a lot of fun.
32:22 Ed Elson? We had a listener question about the subject from user Occam's racer.
32:29 Ed Elson? They say, what lessons did you learn from including Reddit members in the IPO? And would you do it again? Sounds like the answer is.
32:36 Speaker 02 Easy answer is would we do it again? Yes. My only regret is.
32:43 Speaker 02 I wanted to get more users in the stock. And one of the parts of the IPO process, and I don't know the right way to fix this. I'll just tell you our experience was, there's like one thing you can't say in an IPO process. As a, you know, part of management of a company, is you can't, you can't sell the stock. You can't be out there pitching. And so our only communication with the user base was basically through our prospectus.
33:08 Ed Elson? Right.
33:09 Speaker 02 Which is like a, you know, 200 page document describing everything there is about Reddit.
33:16 Speaker 02 But I, I, I wish there was a way for us to have communicated more on their level.
33:22 Ed Elson? Right.
33:23 Speaker 02 Of like, why we think this is important, why they should be in the stock? Why we think this is an awesome opportunity to invest at the IPO? Even explaining the dynamics of like how the pricing works and how the pop works. You know, you, you can't do that.
33:38 Speaker 02 Just legally, but I wish we could have done more because I think. A lot of people, I think a lot more users would have invested and would have done very well if we could have been more successful in that.
33:53 Speaker 02 And you're very limited in what you can say from our communications, from comms. Like, you really can't talk to the press during that time as either. And so you're kind of at the mercy of what like the press or investor press thinks of you. And they were really hard on us, right? They were framing Reddit as a terrible business. And so it scared a lot of people out of participating. And that was just a bummer because we knew the business was doing great. We tried to make that as clear as we could in the prospectus. We knew we were going to price it low because we wanted the price to go up, which happened. But you definitely can't say that. So it's just like, I have some sadness around that. I wish we could have gotten more users in. Right.
34:29 Speaker 02 But I understand why, but it's just, it's a missed opportunity.
34:33 Ed Elson? Let's talk about content moderation, censorship, free speech. These are sort of the issues of the day right now. There's been a huge amount of debate over this. It probably all kind of started when Elon bought Twitter. I mean, the idea was to make free speech available and legal again. That was at least the stated intention. And then just this year, after Trump was elected, we saw a shift from Zuckerberg, who decided to move his content moderation policies in a different direction. And he decided to get rid of content moderators at the company
35:15 Ed Elson? and move to a more community-based moderation system. You are sort of at the epicenter of all of this. And actually Reddit is a lot closer to the community moderated end of things versus having a centralized system of removing content. So give us your views on content moderation today, free speech. Where do you stand on the issues? And how does Reddit fit into this conversation?
35:45 Speaker 02 Okay, so let's just go a little bit further back in time.
35:48 Ed Elson? Okay.
35:49 Speaker 02 Because there is a history of the internet prior to when Elon bought Twitter. And there is a history of free speech in this country that's a little bit older than three years ago.
36:04 Speaker 02 Free speech in the First Amendment is literally the founding law of the land. It's something I think sometimes Americans take for granted as being one of the only countries on earth that actually has free speech in the Constitution, and definitely the only country that enforces it the way that we do. I think it's really, really important. And we take a lot of how Reddit works, we take from the United States. The whole platform is a democratic platform, and we believe in free expression and free expression and free association. And we also believe in this democratic idea of empowering our users.
36:46 Speaker 02 That is the founding principle of Reddit, is we don't decide what people say and do. We create a platform where users self-organize and are free to express themselves. Now, there's a big difference between Reddit and the United States, which is Reddit is a, we're not a country, we're a community platform. And ultimately, we're building a community where people have to want to be. You don't broadly get a choice of which country you live in, not at internet scale at least. And so, you know, we start with the idea of free speech and free expression.
37:26 Speaker 02 And now, we've put some constraints on Reddit that are expressed in our content policy. Now, every word in our content policy is a lesson that we learn the hard way. It's fairly straightforward, right? No hate, harassment, bullying, no inciting or glorifying violence, no spam, nothing illegal, no involuntary sexualization, nothing involving kids.
37:55 Speaker 02 Those rules are all very important to us. But we want Reddit to be a place where people can express themselves and have debate and dissent and even protest on Reddit, which happens from time to time. Now, our model starts, though, not with the centralized moderation. It starts with community moderation. Right. And so every piece of content on Reddit is created by users. And every piece of content is voted up or down by users. Nothing on Reddit becomes popular without a community of people making it popular through voting. And within the context of a community, users can also downvote things. And so if somebody's behaving badly or being an asshole,
38:40 Speaker 02 whether or not, like, being an asshole is not against our rules, they'll probably just get downvoted. In most communities, they'll get downvoted. Not all. And that's kind of the point, is the communities can set the tone of conversation for themselves. And I think one of the things that makes Reddit a really, truly special place is because we let people be people. And one of the lessons I've learned just about humanity is people want nice things. They want to have nice experiences. And so in communities, groups of people within Reddit, off of Reddit, online, offline, they'll create these experiences for themselves. You know, just even think of like a, you know, a room like this, right? For the listening audience, I'm in a room with about 200 people.
39:24 Speaker 02 I can technically say whatever I want, but there's like rules of decorum that we kind of informally agree to for how I'll conduct myself and how you'll conduct yourselves. And I think those rules of decorum, those are, those come from communities and they're really, really important. And so we see that on Reddit. And then outside of the user voting, we have moderators. Now, when we say moderator, it's not an employee of Reddit. It's a user who creates a community on Reddit and becomes a moderator. And so they have complete control over their communities. And so the way we think about Reddit, it's like a federalist system. We have our site-wide, platform-wide rules. Those are like federal laws. And then our communities have their own rules, written for themselves. Those are like state laws. And the community rules can be as strict as they like.
40:09 Speaker 02 And, you know, some are quite strict, some are not. Far and away, the most common user-written rule for communities on Reddit is be nice or be civil.
40:22 Speaker 02 It's not really a practical platform-wide rule. We'd never be able to enforce it, any more than it is a practical law. But it is kind of a rule we have in society broadly, and it's a rule that you see on Reddit all the time, and the communities enforce it for themselves, and it's really, really powerful. Now, we've been doing this on Reddit for 20 years. That's five presidential elections and, you know, five, you know, transitions. The political wind blows this way and that way. But what you haven't seen is Reddit rushing to one direction or the other. I think the only sane way to live is to make decisions from your own values and own principles.
41:07 Speaker 02 And so there's been a steady, I think, change and evolution on Reddit of how we moderate, of how the systems work, of what our own rules are, of what the community rules are. But they come from our own needs, and they've served us very well. So we're not done evolving. It always kind of comes and goes, and the temperature raises and lowers. But I think starting with our communities, starting with our users, and starting with our own common sense and basic human decency has gotten us, has gotten us to where we are today, and I'm proud of where we are today.
41:45 Ed Elson? We'll be right back.
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43:08 Ed Elson? We're back with first-time founders. I want to talk about the future of Reddit. And I'm going to start with a question from a user. This is from David949. When is Reddit going to have its own AI? For example, you could ask a question and an LLM responds with data trained from within Reddit. So much of Reddit is people asking the same questions over and over again without searching through the past.
43:32 Speaker 02 That exists. That exists. It's called Reddit Answers. You can use it today. I think you have to be logged in. You can go to reddit.com/answers. So you can go in the app. It's down in the bottom. Ask it any question and it will give you an answer from Reddit. And it's a cool little product. We built it in like 90 days, almost as a tech demo, just to get it out there to answer the question of how deep is the Reddit corpus? And how useful is it to answering subjective questions? And the answer is extremely deep. It's 20 years of people talking about everything.
44:11 Ed Elson? Yes.
44:11 Speaker 02 And it's really, really useful. So whatever it is, you know.
44:18 Speaker 02 Whether it's like, what are fun things to do in San Francisco? What's the best pizza in New York? Like, what's the best backpack for traveling? You know, whatever it is. It's great for travel. Like, what should I do in Thailand? Or this or that? You'll get an answer fully from Reddit content. And I think it's unlike any other products in existence on the internet. And because it's from Reddit, it's kind of live. It's constantly, you know, up to date and fresh with whatever people are talking about right now. So the answer is, we have that. And a lot of what we're doing this year is investing more in that. Making that product more cohesive into the Reddit products. You know, just generally improving it because we really whipped it together and bolted it on. And so now we're going to go back through and do a really nice job on it.
45:03 Ed Elson? Yeah, the way I would put it, you're basically sitting on one of the giant, the most gigantic treasure troves of data that kind of exists today. And I just want to go through some other stats about Reddit. So Reddit is the sixth most searched term on Google in 2024, after news and before map. More than 100 million people use the platform every day. It is the ninth most visited website in the world, ahead of Amazon, ahead of TikTok, and ahead of Netflix.
45:34 Ed Elson? But then I look at the company and you look at the revenue and you look at the market cap. And compared to those companies, compared to Amazon, compared to Netflix, it does pale in comparison. And this is a question that we got from actually a lot of Redditors, which is, what is the plan to monetize Reddit? Is there a future? Is there a world in which Reddit, you know, given its size, given its influence, can compete both from a revenue perspective and a valuation perspective as the biggest companies in the world? The Amazons, the Googles?
46:05 Speaker 02 Sure. Look, I think it's very simple.
46:08 Speaker 02 The...
46:10 Speaker 02 The market cap follows the revenue, the revenue follows the users. And so we think about how do we grow? Reddit is, I think, has universal appeal. It's communities. Literally, everybody in this room, if you're not a Reddit user, you have a home on Reddit. Whatever you're into, whatever you're thinking about buying, whatever you're going through. And what I mean going through, I mean, whether it's parenting, relationships, jobs. You know, I joke, but it's not a joke. Everybody's got a rash, right? Everybody's got a thing they're going through. It's on Reddit. And you can talk about it on Reddit without fear that's going to come back to your real-world identity.
46:53 Speaker 02 And so I think we're one of the few platforms that literally everybody on the internet can enjoy. And so our job is to reveal that. So, you know, make it so when you open the app for the first time, you actually find your home. You know, we were talking about moderation before, making sure you're not scared away in your first session. You know, that's the, that's the community platform, the community that people want to be on idea. Growing internationally, so, you know, translation is, is one of our big efforts there. Today, we're a platform with about 100 million daily visitors. You know, we think about how do we get to a billion? Well, I can tell you very succinctly, we have about 50 in the US, 50 outside the US. I think we can double or triple in the US. We have about 50 million Americans visit Reddit every day.
47:38 Speaker 02 We have about 170 Americans visit Reddit every week. And so you can see the potential right there. We're only about 50% international, but our peers are 80 to 95% international. We would expect to be in that range as well. So I think we should be able to double or triple in the US. And I think we should be able to 10 to 20x outside the US in users. And then revenue and market cap will follow that.
47:59 Ed Elson? And the revenue comes from advertising mostly? Or is there a world where you're selling the data that you have maybe to be used in AI? I know there's this content partnership with OpenAI that you guys have, or maybe subscription?
48:14 Speaker 02 Ads is a primary business model. Ads is great because it scales and it's also universal.
48:20 Speaker 02 You know, every company's customers are on Reddit. And so ads is really, really powerful from that point of view. And we can, we have first party targeting, right? People express their interests on Reddit. You know, all of your hobbies, again, whatever you're thinking about doing, purchasing, whatever. So ads is a great fit. That'll be our primary business model, I'm sure, for forever. But we also do data licensing. So we've got a couple of big customers there, Google, OpenAI, a lot of smaller customers there as well. And then subscriptions as an opportunity as well. We have that business today, but it's fairly small. I think there's a lot more we can do there.
48:54 Ed Elson? We've talked a lot about Reddit, the company. I'd love to talk about you as a founder as we wrap up here. You've built one of the great companies of our time. You serve hundreds of millions of people. You oversee thousands of employees. Put simply, you are a good leader, clearly.
49:19 Ed Elson? And so I'd love to know, in your view, what does it take to be a great leader?
49:27 Ed Elson? For anyone who's running an organization, whether it's a company, a nonprofit, whatever it is, what are some of the key strategies and principles it takes to lead well?
49:36 Speaker 02 Thank you. It's very kind of you to say. I won't dispute the premise because we only have a minute. But I'll tell you that the things that I think about, hopefully they're helpful, hopefully helpful to you.
49:49 Speaker 02 I think the most important thing is just being honest. Like, what are you trying to do? Why do you want to do it? What does it take to get there? What's going well? What's not going well? Like, what are your hopes? What are your dreams? What are your fears? I think it's very basic human stuff.
50:06 Speaker 02 I think that sort of mentality works at every scale, whether I'm doing a public conversation like this, or I'm talking to the whole company internally, or just talking to a team or an individual. Just being straightforward about what we're trying to do and why, and not sugarcoating things, I think is.
50:27 Speaker 02 I think it's really important. I think vulnerability builds trust and then trust is what builds cohesive teams and then you need, of course, cohesive teams to do things. And so I think it's easy to say, I think sometimes it's hard to do.
50:46 Speaker 02 The other thing that I think is really important is just being present, right? Showing up and working and caring and being a part of the team at every scale. So I think it's, let's call it trust and showing up, trust and presence.
51:00 Ed Elson? You've also had to make some really hard decisions as the leader of this company, considering all of the controversy that you've talked about over the years. Do you have any principles for decision making?
51:12 Speaker 02 Yes.
51:13 Ed Elson? How to make tough decisions?
51:15 Speaker 02 Oh my God, I could talk for a whole hour about making decisions. So principles, yes, I think in principles. And so at Reddit, we have our mission, we have company values, we have five of those, we have platform values, we have five of those, we have privacy principles, we have various product service areas, various principles for them. These are basically enumerated rules for what we will and won't do and how we should do things.
51:45 Speaker 02 And then when we make decisions, you know, I have a whole kind of process for making decisions and a whole presentation at Reddit for how to make decisions. But the very short version is first, take your decision, try to escalate it to a value or a principle and then make the decision using that value or principle. And I think the thing about values is they exist for one reason, which is to make hard decisions. And so if you're not using your values to make hard decisions, then they're not your values. They're just things you wrote.
52:24 Speaker 02 You know, there were idealistic things you wrote that you later ignored when you needed them. And so, yeah, I can give you one of, off the top of my head is we have a value called default open. Which is both internally, externally, we try to share when we can. Like, why are we doing something? What's the data? Like, what's the reasoning behind this? And this, this comes up all the time internally at work. We try to share as much information as we can with the whole company. Being a public company, that is one drawback is we, as we, within the quarter, there's some things we can't share.
52:58 Speaker 02 But within the company and externally, we try to share our reasoning. One of the Bs in my bonnets is when we'll make a post for a product feature and we try to frame a company problem as a user problem. That drives me nuts. I hate when we do it.
53:18 Speaker 02 You know, it's, it's like, and companies do this all the time. They're making some change in the best interest of the company and you're trying to convince the user it's in the best interest of them.
53:28 Speaker 02 And, okay, what's an example? You come to Reddit from Google on mobile web and we're like, download the app. We used to be much more aggressive about that. And then we used to say, I think, like, download the app. It's a better experience, just like technically true. But what we should say is like, download the app. It gives us more app users, which is more valuable to the company. Because users can tell when you're kind of bullshitting them and they get really mad. And honestly, I think if we ever do cross promo again, it will say, download the app, it's better for our business.
53:55 Ed Elson? Yes.
53:56 Speaker 02 I bet it would actually, users would understand.
53:58 Ed Elson? Hundred percent.
53:59 Speaker 02 Like, if it's just like that sort of thing, it's just like, just tell them the truth of why you're doing this. And it's not always to their benefit, sometimes it's your benefit. It'd be better if it was to their benefit, so why don't you start there?
54:09 Ed Elson? Exactly.
54:10 Speaker 02 Solve the user problems, but if you're going to solve a company problem,
54:14 Speaker 02 just tell the users, we're solving a company problem. You know why we sell ads? To make money. You know why we make money? To keep this thing online. So that's, I think, an example of, for example, our default open value. And when, when we violate that value, it's, it's not great.
54:26 Ed Elson? You've built a great team at Reddit. I've met many of them before, before we spoke. I'm someone who believes that great companies are basically a result of having great talent and a great team. Everything else, to me, is sort of downstream of that. As we wrap up here, what are your views on team building? And what is your strategy for building and retaining great talent?
54:51 Speaker 02 Okay, I think you're exactly right. Great companies are built by great people, full style.
55:00 Speaker 02 The way we attract talent is through all the stuff we've been talking about. We have a mission that gets people excited and inspired. We have a product that is really fun. We have a company culture, I think, as a result, that feels both important and fun.
55:19 Speaker 02 And, you know, we try to be straightforward about these things. Like, what's the challenge? What's the opportunities? What do we get if we're successful? And I tell people, look, you can come to Reddit. You can work on this really fun product. We get to do things at world scale. We still have the opportunity to grow, you know, 10, 20x. And if we are successful in that sort of growth and achieving our mission, we can look at our work and be really proud of what we've done. And I think people find that really inspiring. And that's what they're selecting when they join Reddit.
55:54 Speaker 02 And what we don't believe in are, again, never trying to coerce people to join Reddit. Never trying to trick them to join Reddit. I don't believe in golden handcuffs.
56:05 Speaker 02 You know, it's a free market. We want people at Reddit who want to be at Reddit. And so the inverse is also true. Like, we do our very best to retain our best people. But when it's time to go, because, you know, they want to pursue a different opportunity, or my favorite reason people leave is to start their own thing. You know, we say, "Thank you for your service. How can we be of help? Hope to see you again someday." And we have had a lot of people leave and come back.
56:29 Ed Elson? Including you.
56:31 Speaker 02 Including me, right? So I wanted to start my own company again and preferred Reddit. Actually, that cycle has happened for a lot of employees. So, again, yeah, we just try to be very straightforward. What are we doing? Why are we doing it? Why is it important? And if that's important to you, then I think you'll really love working at Reddit.
56:49 Ed Elson? A final fast question, and then I'm going to let you go. Many young entrepreneurs listen to this podcast. If you were to give one piece of advice to a founder who's just starting up today, what would it be?
57:02 Speaker 02 I think...
57:05 Speaker 02 The cliche piece of advice here is really good, which is there's no substitute for hard work. You know, take your idea. You don't know if it's good or bad. You think it's good. Everybody else thinks it's bad, which is always going to be the case, and work really, really hard on it and see if you can turn it into something. If you don't work really, really hard on it, it will not work. And if you work really, really hard on it and it doesn't work, maybe it's trying to do something else. So I think that's one of the only variables that you can definitely control is showing up every day, giving a damn, and working really, really hard on it. And hopefully finding people along the way who will have
57:49 Speaker 02 the same mentality.
57:51 Ed Elson? Steve Huffman is the co-founder and CEO of Reddit. Steve, really appreciate your time.
57:57 Speaker 02 My pleasure. Thanks, folks.
58:02 Ed Elson? Thank you. And now I got to read the credits. This episode was produced by Claire Miller, who is over there. Thank you, Claire, and engineered by Benjamin Spencer. Drew Burrows is our technical director. Alison Weiss is our associate producer. And Dan Cholton is our intern. Thank you for listening to First Time Founders from the Vox Media Podcast Network. Thank you to YPO for hosting us. And thank you all for coming. It's been really great.
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