You’ll want an entire lot of karma or moderator expertise on Reddit if you’d like the prospect to purchase into the corporate’s inventory at its IPO worth forward of its public debut.
Reddit’s IPO paperwork, which the corporate filed publicly on Thursday, outlines six tiers that the corporate will use to find out which of its largest customers could have an opportunity to purchase its inventory by its directed share program. The submitting confirms an earlier report from The Wall Street Journal that the corporate plans to promote inventory early to pick Redditors at its IPO worth along with bigger cash managers — an uncommon transfer.
The first tier consists of “certain users and moderators identified by us who have meaningfully contributed to Reddit community programs,” Reddit’s S-1 submitting with the SEC reads. The submitting does not say what number of shares will probably be reserved for Redditors.
From there, Redditors will qualify for various teams based mostly on their karma — a measure of how a lot a person’s posts and different actions on Reddit contribute to its message boards — or what they’ve contributed as a moderator.
Here’s the whole breakdown of these tiers:
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Tier 1, for “certain users and moderators identified by us who have meaningfully contributed to Reddit community programs”
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Tier 2, for customers with at the very least 200,000 karma or moderators with at the very least 5,000 moderator actions of their previous
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Tier 3, for customers with at the very least 100,000 karma or moderators with at the very least 2,500 moderator actions
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Tier 4, for customers with at the very least 50,000 karma or moderators with at the very least 1,000 moderator actions of their previous
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Tier 5, for customers with at the very least 25,000 karma or moderators with at the very least 500 moderator actions of their previous
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Tier 6, for “all other eligible users and moderators,” in response to the IPO submitting
But qualifying for one in every of these tiers does not promise anybody Reddit inventory: If demand is nice sufficient, Reddit will put eligible customers on a waitlist, in response to the submitting.
The program is open to Reddit customers and moderators who’re US residents, at the very least 18 years of age, and who opened their account “on or before January 1, 2024,” the submitting reads.
Up to 75,000 Redditors could have entry to the directed share program in March, the Journal reported Wednesday.
Offering inventory to customers is an uncommon technique within the IPO world. But Reddit is not the primary firm to do it. Stock buying and selling app Robinhood let its customers purchase as much as 35% of its shares early in 2021.
Are you among the many Redditors with sufficient karma or moderator actions to get in early on its IPO? Reach out to this reporter at abitter@insider.com