So, is Spez finally beginning to realize just how badly Reddit shat the bed here then? Ha, good luck to them, their insanity just spawned eventual competitors and made a LOT of their userbase realize many things about Reddit that they weren't happy with at all.
Enjoy watching your site and it's IPO slowly collapse then. Time for something better.
@fivezero Holy shit that is one top heavy company. No wonder they haven't made a profit. I'm done with f u/spez but it will be entertaining to watch him continue to devalue the company. Fidelity downgraded the value and who knows what the Chinese investor Tencen thinks. It will be delicious to watch spez screw up his IPO. Desperation has gripped spez and its getting worse.
@BraBraBra I’ve heard people say that. I’m aware that there have been previous reductions in value. My experience is that investors have the best access to a company’s information, often in real time in a situation like this, so I think the investors are baking in any user loss and loss of revenue even if they are not publicly admitting it.
It shows how bots were there all the time posting adverts and paid posts anyway. One of the reasons to limit API is other companies were using them to advertise (hidden as a comment or post) without paying the piper.
He's a CEO precisely because he does things like this. CEOs are selected for maximum profitability at the detriment of literally everything else. That's also why psychopathy is way more widespread among CEOs than the general population.
Reddit could slim down management as moves toward an IPO
Thomas Maxwell
Reddit is preparing for an IPO amid controversy surrounding changes to its API.
Reddit employees say the company has a bloated leadership structure with too many managers.
Staffers were told earlier this year that they'd need to do "less but better."
As Reddit prepares for an initial public offering that could come by the end of 2023, it's looking to flatten its management structure, and employees say the company has become bloated with executive- and director-level employees.
Reddit filed for IPO in December 2021, when demand for new tech stocks was at a fever pitch. It said it surpassed $100 million in advertising revenue in the second quarter of 2021. It has also made large investments in artificial intelligence, acquiring the machine-learning startup Spell in June 2022 to help customize ad placements.
Since then, demand for tech stocks has dropped. Reddit laid off 90 employees in early June as it aims to reach profitability. Its revenue growth has slowed, The Information reported.
To prepare for the intense scrutiny of the public markets, Reddit is whipping itself into shape; managers told employees in product earlier this year that the goal was to do "less but better." Part of the mandate could include slimming down middle management.
Reddit is also examining areas of its business where it could squeeze costs. It recently announced a controversial decision to charge for access to its API, or application programming interface, which enables developers to build tools that connect to Reddit. It argued that it couldn't support third-party apps that use Reddit's content but don't provide any money in return.
Insider spoke with five current and former Reddit employees, who requested anonymity as they were not authorized to speak to the press or had signed nondisclosure agreements to receive severance. They described some leadership moves and road-map changes that caused what one employee described as "thrash."
The 18-year-old social-media company has long had a culture of "trying to do too many things and doing them really poorly and not finishing them at all," the same employee said. Internally, they said, the company would now focus on "having a simplified product plan and sticking to it."
A Reddit representative declined to comment on this story and pointed to a blog post about the company's acquisition of Spell.
A flattening at Reddit
Reddit executives presented a distribution of managers to direct reports during its last quarterly leadership summit in May in New York City. The distribution showed that many managers oversee four to six people. Managers who attended the summit told employees that leadership suggested the company would in the second half of the year consolidate teams with managers overseeing fewer than six employees, two employees said.
Employees say this could mean more managers may leave through managed exits.
Reddit is not the only tech company flattening its leadership structure. Meta CEO Mark Zuckerberg said earlier this year that the company would reduce its number of product managers and directors to make it more efficient. Meta had given managers the option to be demoted, with the expectation that many would choose to leave. Shopify has also tried to flatten its organization.
Lost trust in leadership
Reddit employees said they lost trust in leadership after a series of missteps. For example, they said they were repeatedly told before the company conducted layoffs in June that layoffs wouldn't happen.
Product road maps changed in May as the company focused on the API changes and on boosting content creation by users.
The recent change to charge for access to Reddit's API also led to protests from moderators. While many employees supported the API changes, they said Reddit's moderators deserved credit for helping grow the site. A former employee who left in April argued that company leadership should have invested more in supporting moderators and that building tools for Reddit's moderator community "has never been a priority" for leadership.
"Reddit has long had staff who have worked hard to provide a better mod experience, but the will to improve this has never come from the top, and Reddit has yet to fund them to the extent they need to," one employee said.
Illustration of a Reddit logo on a mobile phone with a laptop behind it
Reddit.
Getty Images
On top of that, Reddit hasn't been able to fully integrate Spell's technology since its acquisition, two employees familiar with the matter said. One employee described Reddit's CEO, Steve Huffman, as having pushed through the acquisition despite opposition from vice presidents and directors, as well as bringing its founders as vice presidents and directors "despite Reddit not needing more of either."
Leadership shake-ups
Reddit had some leadership changes earlier this year. Jack Hanlon, who was the vice president of feeds, AI, search, and data, parted ways with the company in March, he and the company confirmed. Hanlon led product and engineering for several areas of the company, including machine learning and data science.
In May, Reddit's head of data science, Jose Lobez, was replaced by Tyler Otto, who'd joined Reddit from Hipmunk, a travel website Huffman founded.
Three employees described Lobez's departure as a surprise, as he was well liked within the data-science organization. "He basically grew the data-science organization himself — a big cultural figure internally," one said. They described Lopez as "pretty open both with reports and about the org as a whole," adding that he "helped deal with interorganization disputes pretty well."
On top of that, Reddit hasn't been able to fully integrate Spell's technology since its acquisition, two employees familiar with the matter said. One employee described Reddit's CEO, Steve Huffman, as having pushed through the acquisition despite opposition from vice presidents and directors, as well as bringing its founders as vice presidents and directors "despite Reddit not needing more of either."
Spez's hatred for 3ed party apps being successful and LLMs scraping reddit data is clearly based on his failures and jealousy of other people succeeding.
I would love to see reddit succeed, but at the end of the day they have chosen to close of valuable user created information to the internet and declared they they alone possess the right to sell the stuff you freely contribute.
They are shitbags and the company deserves to burn. Bring back forums.
I wonder if there’s any data available on how much content was generated from 3rd party apps. in my experience, reddit was accessed solely through an app (rip baconreader). am I wrong in thinking that the users are the product and advertisers the customer?
You’re not wrong and this article really drove this home for me.
Especially how leadership really didn’t care about moderators having the tools they need to do the job they volunteered for.
They don’t care about the quality of the site, just that people keep posting so they can package up all that sweet sweet data for advertisers.
Think about all the little niche communities. I’m sure Reddit can link your username to your real identity internally. Imagine the profiles they can build and sell.
They don’t even care if you stop posting, it’s all there.
am I wrong in thinking that the users are the product and advertisers the customer?
I think there was/is a monetization route through the use of user data (probably why they’re pushing their app so much) as well as using all the data for things like language AI modeling.
But on that last one it seems like the biggest players such as openAI and Microsoft already scraped their site freely. Not sure if they’ve missed a big chunk of that opportunity by now
I have developed the impression, and it’s mostly just my hunch not so much evidence based - spez and co are kind of kicking themselves for being oblivious to the AI training rush and failing to monetize on it. Probably didn’t even realize it was happening until we all did via crazy headlines showing up in news about what AI could do. That kind of thing may lead to kneejerk decisions on api access
If Reddit leadership was oblivious, their heads were under a rock. Various GPT iterations have been training on different subreddits and posting to places like r/SubredditSimulator for years and have even been reported on in the media well before ChatGPT came out. Here is one report on it from 4 years ago:
While third party app users probably had a larger proportion of contributors, Reddit is big enough to still have plenty of content. Moderators are more interesting and it remains to be seen over time if an erosion of quality moderation happens which would make Reddit even shittier. Especially since Reddit seems to keep fumbling when it comes to providing good first party mod tools, see the whole r/Blind fiasco.
am I wrong in thinking that the users are the product and the advertisers the customer?
As long as profitability is the goal then you are correct.
At least ChatGPT is a more polite than the toxic, racist & sexist shit that remains on Reddit. Scrolled through /r/all this morning and was appalled by some of the toxic comments in the various submissions. I also noticed some sockpuppets somehow spewing the same bullshit opinion about certain topics, using the literal same type of phrasing too, just in different comment chains and with different accounts.
Honestly, probably better for my blood pressure to stay away from most of it.
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