I hate being “that guy”, but social media is in a pretty dark place. I don’t want to be negative. I don’t want to “hate” on something just because it’s trendy. I genuinely want good ideas to thrive and find success.

There’s success, and then there’s “SUCCESS ®™ ©”.

As we approach a long-delayed IPO, if investors reward Reddit with a healthy stock price, I can’t see any positive outcome for the communities that rely on Reddit.

I tried writing a newsier version of this article, sticking just to the facts, and abbreviating some of my emotional baggage tied to this website. That article failed. The story of social media is intrinsically tied to the relationships we build on those platforms, and that’s a personal and emotional aspect that can’t be ignored.

Facebook was a living school yearbook. Twitter was a plucky “town square”. Reddit was a community center with rooms for all kinds of little clubs. Over the last couple years, it seems each of these services has turned against their users.

This is the part of the editorial where we highlight the word “enshittification”, and acknowledge the excellent commentary and analysis by Cory Doctorow, but even this word is locked in a spiral of numbing outrage. It’s easy to lob this word like a hand grenade, feel like we’ve accomplished “commentary”, and then return to the platforms that are causing this frustration out of some kind of apathy, momentum, or obligation.

It doesn’t matter that there is a (sometimes) functional website located at “twitter dot com”. Twitter as a platform for sharing ideas, and watching news in the moment it happens, has been dead for a while now. It died before its owner tried to rebrand it as a stupid single letter.

Less dramatically, but following a similar trend, Reddit’s current trajectory should be more publicly concerning.

Reddit is about to open the doors to investors, and I’m not sure why now is the right time to make this play. In a world of monetizing consumer data, a community of communities would surely be an attractive investment opportunity. Examining the company’s recent history, and seeing a swath of failed initiatives and frustrated users, should be giving investors pause. I am not qualified to offer financial advice, but for the better part of 20 years, this site has failed to monetize its platform and users.

Some might be reassured by the recent announcement that Google will be licensing Reddit’s community data to train AI and LLMs. Google will be paying roughly $60 million a year for the access.

That’s not a lot.

Reddit reported $90 million in losses over 2023. Even if the Google licensing deal had been added on to last year’s earnings, Reddit would still have been in the red.

Of course, Google is only one company. If others also licensed this data and paid for API access, then surely Reddit would be profitable quickly. On its surface, Reddit’s move in 2023 to block 3^rd party apps and charge for API access starts to look like a wise strategy.

The value of Reddit’s data has never been tested as a monetizable commodity.

We don’t know what the licensing deal with Google looks like, but Google’s current push for AI services would lead us to believe that every investment in AI training is working towards some kind of product to sell. An online AI tool with the collective “wisdom” of Reddit is not a replicate-able business model at scale.

There is no “disruption” in this strategy. It feels more like a team of people looking at the last potential revenue sources for a big bucket of data.

We’re already witnessing a consolidation around AI talent. Engineers and developers are increasingly resistant to jumping on start ups or smaller projects. Precious few companies have the resources to invest in GPUs, data centers, pay for electricity, get sweetheart zoning deals and tax breaks, and operate at a pace where $60 million a year for pet gifs and five year old tech support archives makes sense.

There’s a concerning sentiment, if Google already has that data, and is using it in their AI products, won’t everyone using Google’s products also already have that data?

This aggressively narrows the list of other potential suitors. We know researchers won’t pay anywhere near that tier for access to publish on social media trends in scientific journals. We’ve already seen that research plummet for Twitter, following Twitter’s more restrictive changes to API use.

If Reddit had more exciting plans to monetize, wouldn’t we have seen them by now?

I struggle to imagine what Reddit might do with the potential investment they’re hoping to land. Estimates are now placing Reddit around a $6 billion valuation, and the company is looking to raise around $750 million.

What can Reddit do with $750 million that they haven’t been able to do over the last twenty years?

Due to its notoriety, I won’t be surprised if it reaches that goal. I’ll be disappointed, but not surprised. If this plan succeeds though, what is already a contentious relationship with volunteers, moderators, and users will almost certainly get worse.

These last two years, we’ve seen Reddit executives largely ignore or dismiss the concerns of their volunteers, and Reddit is only possible due to the enormous amount of work it receives for free. We might scoff at Reddit’s CEO getting a compensation package worth $190 million this year, but that’s largely in stock awards. The rest of the operation is fairly lean.

Reddit is already bad at supporting those volunteers. When this IPO launches, satisfying investors will become the primary focus.

This cycle usually plays out over a longer period of time, but every generation of social media seems to accelerate the worst aspects of doing business online. From a pet project that attracts users, to a platform experimenting with advertising, to a husk that exists to squeeze users and advertisers for investor returns. Reddit had an “old school” internet vibe which was charmingly simple. I believe we’re going to see the last stage arrive aggressively fast following the public offering.

I understand users and moderators continuing to support the platform. It’s not out of any love for the platform, but the bubble of a community they built within the walls of that platform. No one wants to throw that work away and lose connections to other like-minded folks. This is deeply meaningful work to the moderators, even when it’s acknowledged their efforts are being exploited.

I’ll never understand advertisers working in this system though. Increasingly, ads are becoming a “pain point” in online services. We have algorithms that should be tactically efficient at pairing consumers with appropriate products, but instead, these platforms wield ads as a “necessary evil”.

Reddit already offers a “premium” subscription tier that promotes ad-free browsing. What advertiser actually believes that their ads are being appropriately targeted to potential customers, if the platform is aggressively marketing a way for consumers to pay to disable ads?

“Are you ANNOYED by these advertisements in your feed? Here’s how you can disable them!”

I don’t like this feeling.

I don’t like WANTING an IPO to fail. An IPO used to be an exciting event. A hallmark. One of our nerdy little services hit the BIG TIME, and we could all benefit from that recognition. Increasingly, an IPO now feels like a death sentence for the philosophy of the service we enjoyed.

I don’t like knowing that in the short term, Reddit will likely reach its goals, and that will validate a terrible business model. I cringe at the idea of all the emboldened “tech bros” that will cluck along about how “the market is speaking”, celebrating some short term bump, while the long term outlook on social media crumbles.

Above all though, I just miss the funky little website we had, where it was fun to hang out.

I wish we could get that back.