(Worth noting that the vast majority of markdown in the value of Reddit and Discord holdings by Fidelity predominantly occurred last year.)
Oh, that means there’s more room to move down.
this post was submitted on 30 Jun 2023
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Reddit Migration
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We must go lower!
Gotta pump those numbers --up-- down
We need to bring WSB in this. If anyone can crash those numbers it's them.
Omg, yes
Two tildes (~~) on each side does a strikethrough.
~~test comment please ignore~~
~~I refuse to do any such thing~~
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Yes! Just like how Tumblr went from $1 billion to $1 million. Let’s do it for Reddit! ⬇️
Rookie numbers
Still overvalued.
Right? How the hell is a company that has never managed to turn a profit worth more than $0?
because none of these numbers are tethered to reality
Mark Hanna: Number one rule of Wall Street. Nobody - and I don't care if you're Warren Buffet or if you're Jimmy Buffet - nobody knows if a stock is going to go up, down, sideways or in circles. You know what a fugazi is?
Jordan Belfort: Fugayzi, it's a fake.
Mark Hanna: Fugayzi, fugazi. It's a whazy. It's a woozie. It's fairy dust. It doesn't exist. It's never landed. It is no matter. It's not on the elemental chart. It's not fucking real.
If you buy a house with a loan and pay it back, you haven't turned a profit either - but you do now own a house that has a theoretical value. That's basically how these things work, investing everything on growing the company in the hopes that some day what they have built can start creating profit, or be sold to someone who thinks they can.
I get that, but who would want to buy a company that's never been profitable? It smacks of a scam. "Hey, bro! Buy my company! It never managed to make any money for me, but it'll be highly profitable for you!" Sounds like the company founder is looking to pull a fast one and laugh all the way to the bank while their investor is left holding the bag.
The only way I can see this working is if the idea is to build a large user base by offering a good user experience, i.e. not monetizing the platform very much, just enough so that it barely pays for its own operating costs. Then you sell that user base to someone else for the express purpose of shoving tons of ads down everyone's throat. In that case it's still a fast one, only in this scenario the users are the victims. But even then I'm skeptical. If that's the plan, why sell the company instead of enshittifying your platform yourself?
only in this scenario the users are the victims
Have you heard of ~~our lord and savior~~ enshittification?
why sell the company instead of enshittifying your platform yourself?
Because it's a lot easier to find someone who thinks they can do it than it is to actually successfully do it yourself - as we are currently seeing with how wonderfully incompetent Spez is with Reddit.
When Yahoo bought Tumblr for $1.1 billion in 2013 - only to sell it for $3 million in 2019 - was Tumblr bringing in millions and millions of profit? No. But Yahoo thought that they would be able to make it.
Elon Musk paid $44 billion for Twitter, it hasn't turned any profit either (and never will enough for him to get his moneys worth, but that's just because Musk is an idiot).
But yeah, quite often it does feel like a scam. Or kinda like... gambling? You hope someone will pay a lot for your company, while they hope they can make it turn wildly profitable, both may or may not come true.
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Profits don't matter under capitalism, it's only stock money. Trying to profit is a death sentence in the tech space, as we're all seeing right now. This system doesn't work for the 21st century
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So imagine that you have a lemon tree that grows the finest lemons in the neighbourhood. You know that with those lemons you could make the meanest lemonade and make a ton of money selling that. The problem is that in order to do that, you need to buy a juice press, a bunch of sugar and maybe throw together a dashing lemonade stand that will draw attention to your business.
The issue is that you don't have any money to buy those things and even if you know you will get rich down the line, the whole project is a dud if you can't even build your lemonade stand.
Enter Mr. Money Bag. I have a whole €1,000 just sitting there in my wallet not doing anything. I would really like that many to become bigger so I look for a way to do that. I have however seen your lemon tree and the awesome lemons it produces. With those lemons I absolutely believe that you can make the greatest lemonade the world have ever seen and I believe the only thing you need to do that is more money.
So I agree to give you those €1,000 in order to build your lemonade stand and in return I will take some of the money that you make from selling the lemonade. It will however take a few weeks for you to do that and until that is done the materials will probably cost more than what you're making from the lemonade.
That's OK for me, though. I wasn't doing anything with that money anyway and as long as I trust that you can still make a bunch of money when it's finished, I'm fine with it. In fact, I decide to give you another €100 to put up a sign in order for more people to find your business quicker.
So everything is tugging along and now you're actually making more money than you spend, so you give me an amazing €1.200; €100 more than I spent! You also get some money, which is awesome because now you can buy yourself that rocking NiN T-shirt you've always wanted. Now this is great, except I still don't actually need that money, not right now at least. So I tell you to keep that money in the company and build an additional even better lemonade stand which will make us twice the amount of money in a few weeks.
Currently, your company haven't made a single cent, but that's fine because your business is sound and everything is tugging along exactly as planned.
Eventually, I decide that I actually want to buy a new high end TV so I actually need some money that I can spend right now. I know that in about ten weeks this company will have made at least €20,000 that it can either invest in further expansion or give back to the owners. So I go to my buddies Greg and Lisa who definitely have that amount of money and tell them that they can buy this company for €20,000. Greg also owns a carpentry which he can use for building even more lemonade stands and Lisa is really good at making signs so with them the company might even make €40,000 in the same time.
So Greg and Lisa together buy my part of the company for €20,000. I get to watch Eurovision on my new 70 inch TV, and Greg and Lisa will together make €40,000 in a few weeks so everyone is happy.
Then after a few months, someone realises that your lemon tree can really only grow a basket of lemons a year and you can't actually grow enough to make the money you hoped for. Everybody panics, the company's value plummets and eventually closes down.
Greg and Lisa are mad because they didn't make the money they hoped for (they did however get back €5,000 from selling the lemonade stands to a neighbor who was about to start an apple juice business). You're also disappointed, but at least you still have your NiN t-shirt. Your gardener goes to jail for some reason, though.
Well it depends on why the company has never managed to turn a profit. A great example is Amazon. I think it existed for like 15 years before it first turned a profit because it was aggressively growing and spending all of their income to try to grow more.
As for Reddit, they are not growing like Amazon did. However, capturing a large user base is worth something because they may be able to monetize those users eventually. Investors view simply having a large user base as pretty valuable.
Is there a reason discord is also being devalued? I haven't heard of anything negative going on there and they seem to be doing fine.
Recent data breach, and users being unhappy with the username rollout.
It also just generally feels bloated nowadays... I just want to chat
Agree, personally. Nitro ads are getting more intrusive too. I understand they have to monetize somehow, but I wish it were handled based on server population rather than blanket spread to all clients. I don’t participate in any huge servers because notification suppression sucks in Discord. The servers I do use are mostly sub 50 users, and as such don’t consume anywhere near as many resources as some of these mega servers out there.
for real! I have a lower tier of nitro but the phrasing around all the higher-tier stuff says "try nitro :)" as if they don't already have their pound of flesh.
notification suppression sucks in Discord
How so? I'm part of several large servers and they're all no notifications.
Because it’s basically all or nothing. And even then, Admins can do notification blasts that override user settings. I want more granular control so I can basically subscribe to specific content in specific channels I interact with rather than broad notification settings.
Don't know if maybe you don't know when the settings but you can change it to just @mentions with suppress @everyone. You could also do that for individual channels within each discord.
For instance I have probably 100 servers that I belong to. But I only have three channels within each of the servers that I want all notifications. Everything else is set to just direct mentions with @everyone suppressed.
Not sure if you knew what but if you did, sorry for the rehash. If not, hope it helped. I know what it's like to be completely annoyed by beep beeping on your computer 😠
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But... You can? You can do settings per channel, and I'm not aware of any thing admins can do to overwrite notification settings, I have huge servers that I haven't gotten a notification for in years.
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It's so sad when apps stray from their lane and just become bloated messes. I'm looking at you too Postman...
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Tech startups of all kinds are being devalued the last 12 months. The tech sector was always heavily based in speculation and so as the markets recoil, the tech sector was going to feel it the hardest. People have been predicting that for years, literally.
The reddit devaluation falls in line with all that, not really the migration at all. Guys I hate to be the bearer of bad news but Fidelity's valuation experts don't give one shit about the happiness of the users, and only give half a shit about the number of them -- which, that number comes from reddit themselves on a "trust me bro" basis, like the user counts of any service. Let me even go one step further: the louder you complain about reddit, the more important you make reddit look, the more valuable you make reddit to investors. You have to re-frame your thinking when considering markets like this: users are not customers, they're products. "Look at the reaction of all those users" is what this migration boils down to, to those valuation experts.
On the exact same note you can bet on the rising popularity of any given celebrity by the number of their detractors. See a new starlet getting hated on by everyone on Twitter? They're going to sell more albums because of it. Every time.
Edit: Just like the trolls, your best bet to change the landscape of social media is to ignore the bad actors, including the social medias themselves. Don't engage with them and don't advertise for them by talking about them. Kbin's second largest magazine is RedditMigration. You're defining this place by the continued existence of reddit. Guys: Move. On. Let it die.
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I still have 14,000 free coins in my account - maybe soon the valuation will drop low enough that I can buy the company with them, like in that Star Trek TNG episode where Data wins so much money that he buys the casino.
it's almost like not listening to your users doesn't end well
4.5 billion still sounds well to me...
Rumor has it that Reddit wants to IPO at $15 billion. Hard to do that when you were worth $10 last year and are worth $4.5 this year.
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A fifty percent drop isn’t a good sign
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I doubt it is related to migration. It is too soon to have any data on that affect and by numbers it is not much of affect either. The only cost factor of migration that can be done before next quarter release would be increased costs in future dur to moderation, but even that would be very subjective. This is probably due to increased interest rate scenario as feds have said they will bring inflation to 2% so there will be more increase. Hence lowering of cost and spend by companies on advertising and marketing.
It's not related to the migration. The article said the lower valuation is as of May 31, before all the backlash on reddit began.
Oh no. I wonder what happened /s
Reddit has very little intrinsic value. Its value comes from its userbase and isn't Reddit's to own.
Thoughts and prayers
😂😂😂 get fucked Spez
It's almost like loudly announcing contempt for your userbase is not good for a website where virtually 100% of their value is derived from the loyalty of their users
Let’s be honest, 10 billion valuation was from august 2021 when cash was floating around everywhere.
Of course it’s not worth it anymore, I’m not sure at all it’s related to the protest but more too the current economic state
We did it, exxitors!
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