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Wednesday, April 17, 2024
Wednesday April 17, 2024
Wednesday April 17, 2024

Sam Altman’s Reddit stake skyrockets to over $600 million after IPO

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OpenAI CEO’s early bet on Reddit pays off with a massive first-day pop on the NYSE

Sam Altman, the CEO of OpenAI, experienced a significant financial windfall in his Reddit stake following its debut on the New York Stock Exchange (NYSE) this Thursday. As Reddit’s shares surged by 48%, Altman’s investment in the social media platform soared in value, pushing his stake to over $613 million. This remarkable increase marks a $200 million rise in value from before the public offering, underscoring the substantial impact of Reddit’s successful market launch.

Altman, known for his leadership at OpenAI and his influential role in the tech startup ecosystem, holds a 7.6% share in Reddit. This positions him as one of the largest shareholders, trailing only behind Advance Magazine Publishers, the parent company of Condé Nast, and the Chinese internet titan Tencent. Despite his significant holdings, Altman, like other insiders, faces a six-month lockup period, limiting his ability to sell shares immediately.

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Before rising to prominence with OpenAI, Altman had already made a name for himself as a savvy investor and former president of the startup accelerator Y Combinator. His portfolio boasts investments in major tech companies like Airbnb, Uber, and Stripe. However, Reddit remains one of his most lucrative bets. Altman’s relationship with Reddit extended to serving on its board until January 2022, showcasing his deep ties to the platform.

Altman’s initial investment in Reddit came in 2014 when he led a $50 million Series B funding round. His enthusiasm for the platform was evident, as he described Reddit as a transformative space for dialogue and discovery. The subsequent investments in 2021, although made at higher share prices, are yet to fully mature in value. Nevertheless, the returns on his early investment have been significantly magnified by the IPO’s success.

This financial boon for Altman occurs amidst a backdrop of his nuanced position at OpenAI, where he has stated he does not seek monetary gain. With no equity in OpenAI and a modest compensation package, Altman’s earnings from Reddit stand out as a significant part of his financial landscape. His return to OpenAI’s board, following a brief dismissal last year, adds another layer to his complex career in tech leadership and investment.

Reddit’s IPO not only benefits Altman but also signals a vibrant future for the platform. Despite trading below its peak private market valuation, Reddit’s public offering has drawn attention to its potential for growth and innovation in the social media space. As Reddit begins its journey on the NYSE, stakeholders like Altman watch closely, hopeful for the platform’s continued success and impact.

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