The Prof G Pod with Scott Galloway - First Time Founders with Ed Elson – The Story of Reddit

Episode Date: May 4, 2025

Live from YPO’s Global Entrepreneurship Summit, Ed sits down with Reddit co-founder and CEO Steve Huffman. They discuss the company’s IPO journey, his unique approach to investor relations, and how Reddit navigates the complex world of content moderation. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Support for this episode comes exclusively from Mercury, a fintech used by over 200,000 companies to simplify their finances. We talk a lot on this show about the journey from great idea to profitable product. Later in this episode, we'll hear from first-time founder alum and CEO of Rogo, Gabe Stengel, about how Mercury was the banking solution he needed in the early days of his company. Mercury can simplify your finances, so you can focus on more exciting things like scaling your business. Learn more at mercury.com. It takes just minutes to get started.

Mercury, banking that does more. Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group, Column NA, and Evolve Bank and Trust, members FDIC. members FDIC. Thank you, brother. Hey, how's it going? Good to see everyone. Thank you all for being here.

And thank you to YPO for putting this on. I think we're recording right now. So just so you all know, this is a live podcast recording as we speak. It's really great to be here. I want to thank the Global Entrepreneurship Summit for putting this on. Thank you to the Palace Hotel for making this all possible. I'm just going to bust right into it because I have one hour and I want to get as much as I can out of the man who's about to walk on the stage here. And we're going to start with just a little introduction, which is something we usually do on this podcast. So in 2005, my next guest had a simple idea to create an online bulletin board where anyone could share links, ideas and conversations. He was 21 years old at the time.

And within a year, he sold his idea to Conde Nast for $10 million. What happened over the next two decades defied all expectations. After leaving for several years he was brought back to the company and under his leadership this once scrappy website transformed into a behemoth going from $12 million in revenue to a billion dollars in revenue. It's now a vast ecosystem of more than 100,000 active communities, covering everything from breaking news and niche hobbies to pop culture and global markets.

And now with nearly 400 million weekly active users and more than 22 billion posts and comments today, this is no longer just a website, this is a cornerstone of our digital age. So please join me in welcoming the co-founder and CEO of Reddit, Steve Huffman. Thanks Steve. All right. So I just got to tell you before we get into this,

I'm a huge fan of Reddit these days. I got into Reddit probably five years ago during the pandemic. I've just got to tell you before we get into this, I'm a huge fan of Reddit these days. And I got into Reddit probably five years ago during the pandemic. I was living in my mom's basement. I was actually a senior in college at the time and I had nothing to do, but go on Google and look at Wikipedia pages and just get interested

in very weird, nerdy things. And I found Reddit and it became almost like an escape for me. It was honestly a really big part of my life at the time. And I mention that because I think Reddit is the same for millions of people around the world. It's a place to socialize, but I think for many it's also in a lot of ways an escape. So I wanna thank you for creating Reddit, and

I wanna thank you for being here. Thank you. I just want to thank you for solidifying the stereotype that our users are all joining us from their mom's basements. Well, I got out of her basement. I'm still a power user. We'll have to start somewhere. Okay. Thanks for having me here today, folks. So this is going to be a regular first-time founders episode, as usual, but we've also

collected some questions for you that we gathered on Reddit. So I'll be doing a regular interview, but we'll also sprinkle in some of those questions as well. And I want to start at the beginning. The year is 2005. You're a senior at the University of Virginia. You're studying computer science. You and your roommate, Alexis Ohanian,

have this idea not to start an online message platform, but to start a food delivery app, which is strange. So tell us the story of Reddit. How did we get here? So, yeah, this was early 2000s. I had had this idea of people ordering food from their cell phones, which I think would later become a good idea. You know, DoorDash and what have you.

But back then, there were some pretty big limitations on it. One is not everybody had cell phones. Two, cell phones didn't really run software. And three, restaurants weren't on the internet. Nevertheless, so something we pursued and that led us to Y Combinator. And so Y Combinator had kind of, during this beginning part of the story, became. YC didn't exist at the beginning. A few weeks later, after we met Paul and the team, YC did exist. We applied with the food idea, but we were ultimately rejected.

But Paul and the YC team, so this is Paul Graham, and the Y Combinator team invited us back to basically figure out what else we could work on. They liked us, but not that idea. And so that something else would end up becoming Reddit. And so I think it was a good call on YC, I hope. One, on not doing a food thing and two, on bringing us back. It seemed to have worked out for everybody. But I think it goes to show that, you know, ideas are not necessarily the hardest part in getting things off the ground. I think great teams can bring, can do a lot with many ideas and not great teams can, you know, ruin the best of ideas.

It's really hard to tell in the beginning what's a good idea and what's a bad idea. The food one is a great example because we could argue both sides of it. I don't know if it's a good idea eventually. I don't know if it's a good idea then. I don't know if we would have been able to get that one off the ground then. Yeah. You mentioned Paul there and for those who don't know,

Paul Graham is the founder of Y Combinator, a legend in Silicon Valley. It is so interesting that you went to Paul and you had this idea. He said no, but then he said, but come back and let's do something else. What do you think Paul saw in you and how influential was he in starting this company? One part of that story though is before Paul said no,

he said, why don't you come pitch the food idea? Because he had given a talk at Harvard called How to Start a Startup. And so after that talk, we met Paul and pitched him on the food idea, and he really liked it. And then he started Y Combinator, and he invited us to interview,

and then he said no. So there's a little bit of a journey there. When we had come back to brainstorm new ideas, the start of the conversation, there's two sides to it. So Paul is a big fan of a website at the time called Delicious. Delicious is no longer around. But back in that era, it was a website for bookmarking.

So a website for bookmarking other websites. Delicious was a neat product. It also, among other things, invented the idea of the hashtag as a like organizational thing. But the problem with Delicious is you bookmark things that are boring, that you want to come back to later.

So it's like things, I can't finish reading in one sitting or I want a reference later. And so Delicious had this side effect or had this page called Delicious Popular that would show the most commonly, things most commonly bookmarked. And so it's really interesting dynamic of interesting links on the Internet that were too boring or long to read in one sitting. And so Paul is like, well, what if there's something like Delicious but the content was good?

Right. That was half the idea for Reddit. And the other half of the idea was from Slash. And so I was a big Slash.user. Slash. is still around. You can go to Slashdot.org. The website is a list of links, basically, headlines to tech news, but what was really magical about Slashdot

was the community that lived in the discussion about the news. And the news was really just the prompts for conversations. And so it's really these two ideas, this kind of like bookmarking, user-powered dynamic platform with a community that lives in the conversation about these things. And so that really was the genesis of what would turn into Reddit. And that really still is the core of Reddit today, which is communities of people having conversations

about things on the internet. So you start the company, around 12 months go by, things are going well. And I don't think people realize this, but you sell the company. And I would call that an extremely early exit. You stick around for a few years, but take us through your decision

to sell. Why did you sell the company so early on? Paul started a company in the bubble called ViaWeb. ViaWeb pioneered e-commerce. Their company got bought by Yahoo. It became Yahoo's store. And so it was one of the first kind of big e-commerce plays on the internet. And Paul would write essays talking about startups and evangelizing startups as a path to creating wealth. And so that was kind of the spirit of Paul and the spirit of Y Combinator is you start a company, you know, your advantage is you can, you're young, you can work really hard, you don't have any preconceived notions about what product should or shouldn't exist.

And the end of the story is, and you sell your company to a bigger company. Yeah. And so that was just kind of the prophecy. And so in YC, we started this thing, Reddit, and then Conde Nast, also known as Advance, I'll use those words interchangeably, but Advance is the technical name of the parent company,

offered to buy us. And so we thought we were just fulfilling the prophecy. And when we ultimately, when the offer came in, I was still 21. I didn't know what success looked like. The advice I'd give to founders now is never sell a winner. But Reddit didn't feel like a winner to me. I think if we went back and looked at our numbers,

it would be, there'd be signs of that. Like we were growing and we didn't know why. That's a great sign, right? If you have so much product market fit, you don't know why your product is working. But we didn't really know that at the time. At the time, it felt like we were dysfunctional internally. We didn't really know what to do.

We didn't really know how to fundraise. There's just so much, I think, ignorance in Naivete that when a company came and offered us real money for this thing, we're like, we would be really silly not to take it. Right. And I think we would have been silly not to take it. Right. And I think we would have been silly not to take it. We didn't know what we were doing yet.

And so our time at Advance, Advance is still our largest shareholder. Our time at Advance for the next three years after that acquisition, I think actually gave Reddit and we as individuals time to mature a bit, which in hindsight, I think worked out really well. Yeah. So you stick around for a while, you end up leaving in 2009. Then during those six years,

Reddit is growing and growing and growing. Then things start to get a little bit controversial around the company. There are issues with content moderation, issues with censorship. While you're gone, some members of the core members of the team were fired. The then CEO, Ellen Pau, was under a lot of scrutiny. And then you come back in 2015. Give us a sense of what happened in those six years and tell us the story of returning to the company as CEO.

So during that time, so this is basically 2010 to 2015, I had left to start a different company, completely different company called Hitmonk. We were doing travel search. Couldn't be more different. Reddit spun out from advance, which basically meant Reddit became an independent company again, had some cash on its balance sheet, had stock that can pay employees with. It was one of the big challenges I had during the acquisition years was we couldn't recruit with stock.

So we're recruiting against other tech companies, but basically to be an employee without equity. So that was really difficult. So they realized that, and so they gave Reddit its own cap table again. Reddit grew, continued to grow. Reddit brought in a couple external CEOs, and then Reddits started to be

tested on the content policy side. Now, in the early days, so call it that first Reddit era, the first five years or so, our content policy was we don't take things down. This was the founding principle of Reddit, which was we didn't want to be the gatekeepers. We didn't want to be the deciders of what

people can say on the Internet. That was the reason we started Reddit is the alternative was news or even platforms like Slashdot where there were editors. So there were gatekeepers and we're like, we're not the gatekeepers. Now that was in relatively easy position to take because we didn't have much to take down. So more difficult decisions about which content should be allowed or not, they weren't really on our radar.

Most of this stuff was like there's like swear words, some edgy content, and lots of stuff critical of Reddit. But the content challenges we'd face later around, you know, just kind of call it generally bad behavior, weren't really an issue for us. And then that time when I was gone, it became an issue. And the challenge the company faced is, and I learned this when I came back to the company in 2015, and I was talking to folks, I was like, why aren't you doing anything? And they're like, well, we don't know what to do.

Or rather, it was like, we're afraid if we do anything, we're going to break Reddit. We don't know how Reddit works. We don't know why Reddit works. And if we make any change, we're afraid we're going to break it. And it was really challenging culturally.

Because Reddit was in the press for all of the wrong reasons. So this is like 2015, in the press for all of the wrong reasons. So this is like 2015, in the press for all of the wrong reasons, as being like a bad player on the internet. And it was really demoralizing for the team. There was about 70 employees at the time. They were really demoralized, they wouldn't wear their swag, recruiting was really tough. We would actually call people and they would

laugh at us sometimes or get offended. Like how dare you suggest that I'd work at Reddit. I remember asking the employees at the time, it's like if this is so difficult and you're so unhappy, why are you here? They'd say, well, because I love Reddit, and I know Reddit's really special. Reddit's played a really important role

in my life. Some of them would say I met my spouse, who by the way also works here on Reddit. And I would say, well, that's why I'm here too, because we knew it was really special. And though we are in the press for all of the wrong reasons, it was still a minority of the content on Reddit, but it happened to be the stuff that was on the front page

and getting picked up on. And it was like, you know, the other 99% of Reddit was really amazing. I think really showing off the best of people and the best of humanity. And so, well, I said, look, it's not, if we change, we'll die. It's, if we don't change, we will die. By the way, we're dying.

That's why I'm here. This thing is dying. And it would be a real shame if it died. So we need to make some changes. And so that's when we created our content policy. Content policy was basically non-existent. Created the content policy, wrote the first version of the rules, created the safety team,

started enforcing those things. And it was a process that we had to go through publicly and with the community of drawing the line, figuring out where the line is, figuring out how to articulate it. And look, it's a journey we're still on, but I think it's a, I think us being able to navigate that, I think in a very human,

authentic way, has allowed Reddit to grow into what it is today. Yeah, I mean, that was 10 years ago, it was doing 12 million in revenue, fast forward to today, a billion dollars in revenue, sitting at around a $20 billion market cap today, you just IPO, we'll get to that, and we'll get to the content moderation as well, which is important. But if you had to give us a few of the main changes that you made in this past decade,

when you came in to today, what would you say are the biggest changes that you made that had the biggest positive effect on the company? There are a lot. The big ones, I think are true, are relevant to any company. Maybe all of these are relevant to any company. The biggest one is we have to use some common sense. And so this is back to the story I was just telling, which is it's not change and die, it's change or die. And asking the question of what is this platform for?

What experiences do we want people to have on it? And what do we need to do to get to the best version of ourselves? And you have to be willing, I think, to throw out things that you once believed, and you have to be willing, I think, to throw out things that you once believed. And you have to be willing to evolve and grow and look at the world through the lens of reality, not the lens that we maybe had when we started the company, you know, whenever that was 10 years prior. And that's still something I tell the company.

It's like you have to have common sense, you have to use good judgment, and you have to think about like, is this product good? Is this a place people want to be? What is the difference between where we are and where we want to be? And you have to be willing to change things to get there. That's the biggest one.

It's just common sense and being practical. Another big change for Reddit was we weren't running as a business. We were really idealistic and I think in many ways the idealism has been very good, but we're also idealistic about not being a business, which is not a great way to run a sustainable business. So we had to figure out, okay, what is our business model?

Ended up being ads. And how are we gonna do this in a way that fits with, you know, what we want this platform to be, fits with our values and so forth. And then there was a kind of similar minded things, which is like the company just wasn't, they were so afraid to make changes and to ship and that wrapped up in some of that idealism was also like not working very hard.

You know, and it's just like, look, we have to work really, really hard. We're in a competitive space. What we do is really important. We want to be successful. I think what Reddit provides people, this sense of community and belonging is really important. If we don't work really hard and work really smart and make this thing successful both from a user's point of view and business point of view, then we don't get to do this and we'll never achieve our mission. All of these high-minded things we love about Reddit, the way it enriches people's lives and provides

people a glimpse of into humanity you wouldn't otherwise see, and now serves as a knowledge force, they won't exist if we don't build the foundation. Do you think this is still a problem today in tech? I say that because I kind of think it might be where tech companies are too idealistic, they don't think of themselves as businesses, they think their mission is something larger than that,

and it detracts from the ability to grow as a company because people are too interested in the idealism versus essentially the revenue in the bottom line. Is that something that you notice in Silicon Valley today still? There are shades of that. I think there's nothing wrong. And I don't think they're really in conflict

of having a big mission. For us, it's to empower communities and make their knowledge accessible to everyone. There's nothing wrong with having a big, inspiring mission. Not only nothing wrong, it's, in my opinion, required. That doesn't come at the expense of building a business. Building a business is required to achieve the mission. To do anything at world scale, you need world scale resources. And so you can't fundraise your way

to doing something world scale indefinitely. Maybe there's some AI companies proving to the contrary in the short term, but at some point you have to be self-sustaining. Yes. The other thing that I've seen though in the Bay Area broadly is, it's almost an entitlement of, I work at these companies,

but I don't have to work very hard and I'm here for myself. And almost sometimes taking, I think, taking ideas from other successful companies and perverting them. So here's one that I used to see a lot, is Apple had this philosophy of it's done when it's done. Externally, I don't know about internal, I've never worked at Apple. Externally, you know, they wouldn't have deadlines, they would build these beautiful artisanal, you know, best in the world products and

ship them when they're ready. Great, right? And they'd hit after hit after hit after hit. But then I would hear this from engineers were like, I'm like, when is this going to be done? Right? And they had hit after hit after hit after hit. But then I would hear this from engineers for like, I'm like, when is this going to be done? And they'll say, well, it'll be done when it's ready. Okay. But like, when is it going to be done? Well, it'll be done when it's ready. But then the version I get isn't

this artisanal world-class product. It's like late and shitty. And I'm so I'm like, you're not Apple. Like, I don't know what Apple's doing over there, but we're not Apple. You're not Apple. I'm not Apple. Like, so, and so I remember having versions of that,

you know, that conversation. And I did this as an engineer too. I was like, well, don't rush me, I'm the artist, you know, it'll be done when it's done. Now it's more like, okay, what can we do in a week? Exactly. Let's get this thing rolling. And so that's part of honestly,

I think not just the company's maturation, but my maturation along with it and our team's maturation, you know, over that story as well. But I've just seen so many startups with that mentality over the years. We'll be right back. This is Advertiser Content from Mercury. You may remember my conversation last year with my friend and first-time founder, Gabe Stengel, the CEO of Rogo. I caught up with Gabe again recently to talk about the early days of his startup. When I started the company, I didn't know a lot about what we were doing.

I don't think you knew anything. I knew very, very little. Tell us a little bit about your company for people who don't remember, Rogo. We're a generative AI platform for financial firms like investment banks, hedge funds, private equity firms. We want to help replace the grunt work and make the senior work smarter and faster and better all around. Did you always want to be an entrepreneur?

I loved the act of taking a vision and pulling it into real life. And I was opportunistic about when it was the right time to do that. And you know, when GPT-3 came out, I was an investment banking analyst and I just thought this is going to transform what we're doing. And it was just the idea pulled me, the vision pulled me. And when you're starting a company and all of a sudden someone comes out of nowhere and offers for us, it was two million dollars.

The first thing you have to figure out is where do I, where do I put this money? And Mercury was just the obvious, easy, simple, fast choice. When you're a startup, you have a very simple hit list. I need to store my money, I wanna get the most out of it so that it's working for me and I don't have to worry about what's going on and I need to be able money. I want to get the most out of it so that it's working for me and I don't have to worry about what's going on. And I need to be able to pay my bills, wire people money, do payroll. And it nailed all of those things.

And it was, hey, this is the toolbox you need, Gabe. Don't worry about anything else. Just get started. See how Mercury can simplify your finances. Check out the demo and get started in minutes at mercury.com. Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group, Column NA, and Evolve Bank and Trust, members FDIC. We're back with first time founders. Let's talk about the IPO. So Reddit went public in March of last year. The issuance price was $34 a share. It's now sitting at around $100 a share. So it's been a pretty good year for you. It was this morning.

It was this morning. I'm much more. Things are changing. Last I checked, you're at around 100. What have been some of the main learnings about going public? What are the biggest differences between running a private company What have been some of the main learnings about going public? What are the biggest differences between running a private company versus now today running

a public company? The biggest differences are really obvious. We have a public share price. We have certain requirements that we have to live up to in terms of disclosures and transparency and so forth. And we have now a massive shareholder base versus having just a handful of private institutional investors. Now, because of all of those requirements, we are a better business, for sure. I think the public company quarterly rhythm of saying what you're going to do, doing it, hitting your numbers, closing the quarter, doing the audit, no fuck-ups, doing the board meeting, the

earnings call, and then for us, we do some extra stuff. We basically do a whole nother earnings cycle with our user base. That rhythm and talking to our investors and talking to our retail investors, our user investors has without a doubt made us a substantially better company. It just raises the bar. And I think we make better decisions now, we communicate, we articulate our strategy better, we work harder.

And I don't know whether it's the sense of duty to our shareholders, to our user shareholders, the fear of failure, the desire to succeed. It's actually all of these things. But they've all, I think, created an environment where we're doing the best work that we've done. And then, as I've said, almost every day for the last 10 years since I returned to Reddit,

we can be so much better. We can be so much better. And I think we have a duty to our users, to our employees, to our shareholders to be as good as we can be. And so, yeah, there are aspects of it that can be more challenging, like turbulent market times like today. For those who are listening on the podcast, on the audio,

the tariffs just went into effect. Today is liberation day. We're liberating Americans from their wealth. Yeah. But honestly, I'd rather have the up-to-date mark than when we're a private company, you don't really know your valuation

and you have no liquidity and you can't use it. So, I think, yes, there's some burdens that come along with it, but I think that the environment and the requirements and the high standards have been really good for us. You mentioned you do the second earnings call. I find this so interesting, I'm obsessed with this. You have this very strange approach to investor relations,

which I love. You do your regular earnings call, but then after the regular earnings call, you go on to Reddit and you do a second earnings call, which is basically an AMA, like an ask me anything. And you'll take questions from all the users of Reddit and they'll ask you everything about the company, which to me is the way that we should be doing

investor relations today. I find the regular earnings call is boring, it's uninteresting, I don't care, the analyst questions are uninteresting to me. I think what you're doing is engaging with the user base in a very different way. Why did you decide to do that? And just take us through your approach to investor relations

more generally. Let me just zoom out for a second and talk about Reddit. Reddit is a user-powered platform. Our users have created everything that's interesting about Reddit. We technically, we built a very simple platform for creating communities, submitting posts, and ranking those posts through voting and having conversations in the form of comments. What our users have done is

created, you know, thousands of communities for every topic imaginable, whatever you're into, whatever you're going through. I think it's truly special. It's the most human place on the Internet. Our users feel, rightly so, a deep sense of ownership over what they've created in Reddit. Their communities are their home

online and sometimes much more than that. And so I wanted that sense of ownership to be actual ownership. And so one of the reasons we went public is I thought being public actually fits the spirit of Reddit. Right? Transparency and public ownership. Like those are really important concepts to Reddit. And so we wanted our users to be, or have the opportunity to be owners, shareholders. So throughout the entire IPO process

from including our user base in the IPO, as in we made it accessible to every user of the platform to buy Reddit stock at the IPO price. Not the first trade price, but the price that we've sold stock to, to the bankers and professional investors, we also sold to our users. So that means they, every user who took advantage of that got to enjoy the pop, which is not usually the case in an IPO. Usually retail comes in after the pop,

which is why the pop feels so unfair. So we said we wanna bring them in at the pop and we wanna give them as much information as we can, the same way we would to the professional investors so that they can make smart decisions there or make the best decisions for themselves. So we did that in the IPO process and we continue to do it every quarter now. So we do our earnings, we do our investor callbacks, and then we go onto the platform and we we solicit questions from the community, every earnings, and then we answer as many of those questions as we can.

So I, our CFO Drew and our COO Jen, we try to do it in one take. We'll do a 30-minute to an hour, one take, we'll just rip through as many user questions as we can and giving them the most fulsome answer that we can. Their questions, I do think yes, are a little more interesting than what we get on the earnings calls. I think both are valuable though.

So we get a lot of the technical quarter to quarter. What's your revenue? What's your traffic? What's the next quarter going to look like calls on the earnings calls? Then from our users, they're like, why'd you fuck up this feature? What are you doing next? Blah, blah, blah. It's super interesting stuff. I really enjoy doing it.

I love talking about Reddit. And we're seeing traction in that community pick up. So we've been doing it a year. And we'll just keep doing that. I think it's the right thing to do, and it's a lot of fun. We had a listener question about the subject from user Occam's Racer. They say, what lessons did you learn from including Reddit members in the IPO and would

you do it again? Sounds like the answer is yes. The easy answer is would we do it again? Yes. My only regret is I wanted to get more users in the stock. And one of the parts of the IPO process, and I don't know the right way to fix this, I'll just tell you our experience,

was there's one thing you can't say in an IPO process, as part of management of a company, is you can't sell the stock, you can't be out there pitchy. And so our only communication with the user base was basically through our prospectus, which is like a 200-page document describing everything there is about Reddit. But I wish there was a way for us to have communicated more on their level of why we

think this is important, why they should be in the stock, why we think this is an awesome opportunity to invest at the IPO, even explaining the dynamics of how the pricing works and how the pop works. You can't do that just legally, but I wish we could have done more because I think a lot of people, I think a lot more users would have invested and would have done very well if we could have been more successful in that. And you're very limited in what you can say from our communications from comms. Like you really can't talk to the press during that time as either. And so you're kind of at the mercy of what like the press or investor press thinks of you.

And they were really hard on us. Right. They were framing Reddit as a terrible business. And so it scared a lot of people out of participating. And that was just a bummer because we knew the business was doing great. We tried to make that as clear as we could in a prospectus. We knew we were gonna price it low

because we wanted the price to go up, which happened, but you definitely can't say that. So it's just like, I have some sadness around that. I wish we could have gotten more users in. But I understand why, but it's just, it's a missed opportunity. Let's talk about content moderation, censorship, free speech, these are sort of the issues

of the day right now. There's been a huge amount of debate over this. Probably all kind of started when Elon bought Twitter. I mean, the idea was to make free speech available and legal again. That was at least the stated intention. And then just this year after Trump was elected, we saw a shift from Zuckerberg, who decided to move his content moderation policies in a different direction, and he decided to get rid of content moderators at the company and move to a more community-based moderation system.

You are sort of at the epicenter of all of this. And actually, Reddit is a lot closer to the community moderated end of things versus having a centralized system of removing content. So give us your views on content moderation today, free speech. Where do you stand on the issues, and how does Reddit fit into this conversation? Okay. So let's just go a little bit further back in time. Okay.

Because there is a history of the internet prior to when Elon bought Twitter. And there is a history of free speech in this country that's a little bit older than three years ago. Free speech in the First Amendment is literally the founding law of the land. It's something I think sometimes Americans take for granted as being one of the only countries on earth that actually has free speech in the Constitution and definitely the only country that enforces it the way that we do. I think it's really, really important. And we take a lot of how Reddit works, we take from the United States, but the whole platform is a democratic

platform. And we believe in free expression and free expression and free association. And we also believe in this democratic idea of empowering our users. That is the founding principle of Reddit is we don't get that we don't decide what people say and do. We create a platform where users self-organize and kind of are free to express themselves. Now there's a big difference between Reddit and the United States which is Reddit is a we're not a country we're a community platform and ultimately we're building a community where people have to want to be.

You don't broadly get a choice of which country you live in, not at the internet scale, at least. And so, you know, we start with the idea of free speech and free expression. And now we've put some constraints on Reddit that are expressed in our content policy. Now every word in our content policy is a lesson that we learn the hard way. It's fairly straightforward, right? No hate, harassment, bullying, no inciting or glorifying violence, no spam, nothing illegal, no involuntary sexualization, nothing involving kids. Those rules are all very important to us, but we want Reddit to be a place where people

can express themselves and have debate and dissent and even protest on Reddit, which happens from time to time. Now, our model starts, though, not with the centralized moderation. It starts with community moderation. And so every piece of content on Reddit is created by users. And every piece of content is voted up or down by users. Nothing on Reddit becomes popular

without a community of people making it popular through voting. And within the context of a community, users can also downvote things. And so if somebody's behaving badly or being an asshole, whether or not, like being an asshole is not against our rules, they'll probably just get downvoted. In most communities, they'll get downvoted. Not all. And that's kind of the point, is the communities can set the tone of conversation for themselves. And I think one of the things that makes Reddit a really truly special place is because we let people be people. And one of the lessons I've learned just about humanity is people want nice things. They want to have nice experiences. And so

in communities, groups of people within Reddit, off of Reddit, online, offline, they'll create these experiences for themselves. You know, just even think of like a room like this, right? For the listening audience, I'm in a room with about 200 people. I can technically say whatever I want, but there's like rules of decorum that we kind of informally agree to for how I'll conduct myself and how you'll conduct yourselves. And I think those rules of decorum, those come from communities and they're really, really important. And so we see that on Reddit.

And then outside of the user voting, we have moderators. Now when we say moderator, it's not an employee of Reddit, it's a user who creates a community on Reddit and becomes a moderator. And so they have complete control over their communities. And so the way we think about Reddit, it's like a federalist system. We have our site-wide, platform-wide rules. Those are like federal laws. And then our communities have their own rules

written for themselves. Those are like state laws. And the community rules can be as strict as they like. And some are quite strict. Some are not. And the community rules can be as strict as they like. And you know, some are quite strict, some are not. Far and away the most common user written rule for communities on Reddit is be nice or be civil. It's not really a practical platform wide rule, we'd never be able to enforce it any

more than it is a practical law. But it is kind of a rule we have in society broadly. And it's a rule that you see on Reddit all the time and the communities enforce it for themselves. And it's really, really powerful. Now we've been doing this on Reddit for 20 years. That's five presidential elections and, you know, five transitions. The political wind blows this way and that way. But what you haven't seen is Reddit rushing to one direction or the other.

I think the only sane way to live is to make decisions from your own values and own principles. And so there's been a steady, I think, change and evolution on Reddit of how we moderate, of how the systems work, of what our own rules are, of what the community rules are. But they come from our own needs, and they've served us very well. So we're not done evolving. It always kind of comes and goes and the temperature raises and lowers. But I think starting with our communities, starting with our users, and starting with our own common sense and basic human decency has gotten us to where we are today, and I'm proud of where we are today. We'll be right back. You can upload bills to pay them, create invoices with a few clicks, track what you're owed, and send money quickly and easily, all from the same sleek and intuitive product.

Visit Mercury.com to apply in minutes. Mercury, banking that does more. Mercury is a financial technology company, not a bank. Banking service is provided by Choice Financial Group, Column NA, and Evolve Bank and Trust, members FDIC. We're back with first-time founders. I want to talk about the future of Reddit. And I'm going to start with a question from a user. This is from David949.

When is Reddit going to have its own AI? For example, you could ask a question, and an LLM responds with data trained from within Reddit. So much of Reddit is people asking the same questions over and over again without searching through the past. That exists. It's called Reddit Answers. You can use it today. I think you have to be logged in.

You can go to reddit.com slash answers. So you can go in the app, it's down in the bottom. Ask it any question and it will give you an answer from Reddit. And it's a cool little product. We built it in like 90 days, almost as a tech demo, just to get it out there, to answer the question of how deep is the Reddit Corpus, and how useful is it to answering subjective questions? And the answer of how deep is the Reddit Corpus and how useful is it to answering

subjective questions? And the answer is extremely deep. It's 20 years of people talking about everything and it's really, really useful. So whatever it is, you know, whether it's like what's, you know, what are fun things to do in San Francisco, what's the best pizza in New York? Like what's the best backpack for traveling?

Whatever it is. It's great for travel. What should I do in Thailand or this or that? You'll get an answer fully from Reddit content. And I think it's unlike any other products in existence on the internet. And because it's from Reddit, it's kind of live. It's constantly up to date and fresh with whatever people are talking about right now.

So the answer is we have that. And a lot of what we're doing this year is investing more in that, making that product more cohesive into the Reddit product, you know, just generally improving it because we really whipped it together and bolted it on. And so now we're going to go back through and do a really nice job on it. Yeah. The way I would put it, you're basically sitting on one of the most gigantic treasure troves of data that kind of exists today. And I just want to go through some other stats about Reddit. So Reddit is the sixth most searched term on Google in 2024, after news and before map. More than a hundred million people use the platform every day. It is the ninth most visited website in the world ahead of Amazon, ahead of TikTok, and ahead of Netflix. But then I look at the company and you look at the revenue

and you look at the market cap and compared to those companies, compared to Amazon, compared to Netflix, it does pale in comparison. And this is a question that we got from actually a lot of Redditors, which is what is the plan to monetize Reddit? Is there a future, is there a world in which Reddit, given its size, given its influence, can compete both from a revenue perspective

and evaluation perspective as the biggest companies in the world, the Amazons, the Googles? Sure. Look, I think it's very simple. The market cap follows the revenue, the revenue follows the users, and so we think about how do we grow. Reddit is, I think has universal appeal.

It's communities. Literally, everybody in this room, if you're not a Reddit user, you have a home on Reddit. Whatever you're into, whatever you're thinking about buying, whatever you're going through, and what I mean going through, I mean whether it's parenting, relationships, jobs, you know, I joke but it's not a joke. Everybody's got a rash. Everybody's got a thing they're going through. It's on Reddit. You can talk about it on Reddit without fear that's going to come back to your real-world identity.

I think we're one of the few platforms that literally everybody on the Internet can enjoy. Our job is to reveal that. Make it so when you open the app for the first time, you actually find your home. You know, we were talking about moderation before, making sure you're not scared away in your first session. You know, that's the community platform,

the community that people wanna be on idea. Growing internationally, so, you know, translation is one of our big efforts there. Today, we're a platform with about 100 million daily visitors. We think about how do we get to a billion? Well, I can tell you very succinctly. We have about 50 in the US, 50 outside the US. I think we can double or triple in the US.

We have about 50 million Americans visit Reddit every day. We have about 170 Americans visit Reddit every week. And so you can see the potential right there. We're only about 50% international, but our peers are 80 to 95% international. We would expect to be in that range as well. So I think we should be able to double or triple in the US.

And I think we should be able to 10 to 20X outside the US in users, and then revenue and market cap will follow that. And the revenue comes from advertising mostly, or is there a world where, you know where you're selling the data that you have, maybe to be used in AI? I know there's this content partnership with OpenAI that you guys have, or maybe subscription.

Ads is a primary business model. Ads is great because it scales and it's also universal. Every company's customers are on Reddit, and so Ads is really, really powerful from that point of view. We have first-party targeting, where people express their interests on Reddit. All of your hobbies, again, whatever you're thinking about doing, purchasing, whatever.

So ads, it's a great fit. That'll be our primary business model, I'm sure, for forever. But we also do data licensing. So we've got a couple of big customers there at Google OpenAI, a lot of smaller customers there as well. And then subscriptions as an opportunity as well. We have that business today, but it's fairly small. I think there's a lot more we can do there.

We've talked a lot about Reddit, the company. I'd love to talk about you as a founder as we wrap up here. You've built one of the great companies of our time. You serve hundreds of millions of people. You oversee thousands of employees. Put simply, you are a good leader, clearly. And so I'd love to know, in your view, what does it take to be a great leader? And so I'd love to know, in your view,

what does it take to be a great leader? For anyone who's running an organization, whether it's a company, a nonprofit, whatever it is, what are some of the key strategies and principles it takes to lead well? Thank you, it's very kind of you to say I won't dispute the premise, because we only have a minute.

But I'll tell you that the things that I think about, hopefully they're helpful to you. I think the most important thing is just being honest. Like what are you trying to do? Why do you want to do it? What does it take to get there? What's going well? What's not going well? What are your hopes? What are your dreams?

What are your fears? So I think it's very basic human stuff. I think that sort of mentality works at every scale, whether I'm doing a public conversation like this or I'm talking to the whole company internally or just talking to a team or an individual. Just being straightforward about what we're trying to do and why, and not sugarcoating things, I think is really important. I think vulnerability builds trust, and then trust is what builds cohesive teams,

and then you need, of course, cohesive teams to do things. And so I think it's easy to say, I think sometimes it's hard to do. The other thing that I think is really important is just being present, right? Showing up and working and caring and being a part of the team, you know, at every scale. So I think it's, let's call it trust and showing up, trust and presence. You've also had to make some really hard decisions as the leader of this company,

considering all of the controversy that you've talked about over the years. Do you have any principles for decision making? Yes. How to make tough decisions? Oh my God, I could talk for a whole hour about making decisions. So principles, yes, I think in principles. So principles, yes, I think in principles. So at Reddit, we have our mission, we have company values, we have five of those,

we have platform values, we have five of those, we have privacy principles, we have various product service areas, various principles for them. These are basically enumerated rules for what we will and won't do and how we should do things. And then when we make decisions, you know, I have a whole kind of process for making decisions and a whole presentation I read it for how to make decisions, but the very short

version is first take your decision, try to escalate it to a value or a principle, and then make the decision using that value or principle. The thing about values is they exist for one reason, which is to make hard decisions. So if you're not using your values to make hard decisions, then they're not your values. They're just things you wrote. They're idealistic things you wrote.

They're idealistic things you wrote that you later ignored when you needed them. And so, yeah, I can give you one of the top my head is we have a value called default open, which is both internally and externally, we try to share when we can. Like, why are we doing something? What's the data like what's the reasoning behind this? And this this comes up all the time internally at work We try to share as much information as we can with the whole company being a public company That is one drawback as we as we Within the quarter. There's some things we can't share But

Within the company and externally we try to share our. One of the bees in my bonnets is when we'll make a post for a product feature and we try to frame a company problem as a user problem. That drives me nuts. I hate when we do it. You know, it's like, and companies do this all the time. They're making some change in the best interest of the company and you're trying to convince the user it's in the best interest of them. Okay, what's an example? You come to Reddit from Google on mobile web, and we're like, download the app. We used to be much more aggressive about that. Then we used to say, I think,

like download the app, it's a better experience. Just like technically true. But what we should say is like download the app, it gives us more app users, which is more valuable to the company. Because users can tell when you're kind of bullshitting them and they get really mad. Honestly, I think if we ever do cross-promo again,

it will say, download the app, it's better for our business. Yes. I bet it would actually users would understand. 100 percent. Like if they just like that sort of thing, it's just like just tell them the truth of why you're doing this.

And it's not always to their benefit. Sometimes it's your benefit. It'd be better if it was to their benefit. So why don't you start there. Exactly. Solve the user problems. But if you're going to solve a company problem, just tell the users we're solving a company problem.

You know why we sell ads to make money. You know why we make money to keep this thing online. So that's, I think, an example of, for example, our default open value. And when we violate that value, it's not great. You've built a great team at Reddit. I've met many of them before we spoke. I'm someone who believes that great companies are basically a result of having great talent

and a great team. Everything else to me is sort of downstream of that. As we wrap up here, what are your views on team building and what is your strategy for building and retaining great talent? Okay, I think you're exactly right. Great companies are built by great people, full style. So, the way we attract talent is through

all of the stuff we've been talking about. We have a mission that gets people excited and inspired. We have a product that is really fun. We have a company culture, I think, as a result that feels both important and fun. And we try to be straightforward about these things. Like what's the challenge? What's the opportunities? What do we get if we're successful? And I tell people, look, you can come to Reddit,

you can work on this really fun product. We get to do things at world scale. We still have the opportunity to grow 10, 20X. And if we are successful in that sort of growth and achieving our mission, we can look at our work and be really proud of what we've done. And I think people find that really inspiring and that's what they're selecting when they join Reddit.

And what we don't believe in are, again, never trying to coerce people to join Reddit, never trying to trick them to join Reddit. I don't believe in golden handcuffs. It's a free market. We want people at Reddit who want to be at Reddit. So the inverse is also true. We do our very best to retain our best people.

But when it's time to go, because they want to pursue a different opportunity, or my favorite reason people leave is to start their own thing. We say thank you for your service. How can we be of help? Hope to see you again someday. We have had a lot of people leave and come back. Including you.

Including me, right? So I wanted to start my own company again, and preferred Reddit. Actually, that cycle has happened for a lot of employees. So again, we just try to be very straightforward. What are we doing? Why are we doing it? Why is it important? And if that's important to you, then I think you'll really love working at Reddit.

And final fast question, and then I'm gonna let you go. Many young entrepreneurs listen to this podcast. If you were to give one piece of advice to a founder who's just starting up today, what would it be? I think the cliche piece of advice here is really good, which is there's no substitute for hard work. Take your idea, you don't know if it's good or bad.

You think it's good, everybody else thinks it's bad, which is always gonna be the case, and work really, really hard on it and see if you can turn it into something If you don't work really really hard on it, it will not work And if you work really really hard on it and it doesn't work maybe try to do something else So I think that's one of the only variables that you can definitely control is showing up every day Giving a damn and working really, really hard on it and hopefully finding people along the way who will have the same mentality.

Steve Huffman is the co-founder and CEO of Reddit. Steve, really appreciate your time. My pleasure. Thanks, folks. Thank you. And now I've got to read the credits. This episode was produced by Claire Miller, who is over there. Thank you Claire. And engineered by Benjamin Spencer. Drew Burrows is our technical director. Alison Weiss is our associate producer.

And Dan Cholen is our intern. Thank you for listening to First Time Founders from the Vox Media Podcast Network. Thank you to YPO for hosting us. Thank you all for coming. It's been really great. Thanks again to Mercury for their support. If you're a digital native and a startup founder then Mercury was built with you in mind. With Mercury you can get an instant

snapshot of your financial health, you can upload bills to pay them, create invoices with a few clicks, track what you're owed and send money quickly and easily, all from the same sleek and intuitive product. Visit Mercury.com to apply in minutes. Mercury – banking that does more. Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group, column NA, and Evolve Bank and Trust, members FDIC.