Reddit CEO Talks About Site Being ‘In The Red’
On Wednesday, reddit announced some changes to its list of default subreddits. These are the ones the site shows on its front page to new and logged out users, and those who haven’t bothered to personalize their own homepages.
As part of the change, reddit decided to eliminate popular subreddits r/atheism and r/politics from the list because they were deemed not to be “up to snuff”.
As the conversation unfolded on reddit, CEO Yishan Wong made some comments on the site about its own monetization.
“I guess I’ll make a statement about our revenue plans vs our community activity,” began Wong. “1/ We didn’t make the frontpage changes for any revenue-related or mainstreaming reason. We made them because (as has actually been discussed in this very subreddit quite often) the default subreddits all evolve in different ways and the community itself begins to find one or more of those subreddits more or less valuable/desirable. (I think you all know what I’m talking about; this will be the only paragraph where I talk a bit sideways, because I don’t want to shit on people) Similarly, other emerging subreddits begin to show a lot of promise so in the interests of adding more fresh material, we’ve added them to the defaults.”
He continued, “1a/ There is a minor point that sometimes taking a subreddit out of the defaults and removing the pressures of the limelight can allow it to incubate and improve, but that wasn’t a reason in our decisions; it’s just something that occurred to me today.”
Wong then proceeded to outline reddit’s revnue channels, which consist of advertising, reddit gold and the redditgifts Marketplace, which he said is “actually turning out to be promising.”
“It’s still nascent, but gift exchanges are quite popular and (again in reddit fashion) we heavily curate the merchants who are allowed in the marketplace,” Wong said. “We’ll see how it develops.”
He went on to note that none of these require the modification or editorialization of the front page or reddit, and that any changes made are with the interests of users in mind.
“A note about short-term vs long-term money,” said Wong. “It turns out that you have to plan for BOTH the short-term and the long-term. If you don’t eat in the short-term, you die and never make it to the long-term. If you do everything short-term, you have no long-term future. So we need to make enough money this year to pay the bills and fund next year’s growth, and we also need to put into place the cornerstones of future growth at the same time. It’s a balancing act.”
He concluded that set of comments by directing conspiracy theorists to an Amazon affiliate link for tinfoil.
Hours later, Wong left another comment on the subject saying that reddit is “still in the red,” and is “trying to finish the year at break-even (or slightly above, to have a margin of error) though.”
Wong said they’re thinking about posting a public graph that would be updated regularly showing revenue vs. expenses on a quarterly/monthly basis so people can see how far/close reddit is to be profitable.
“There is a common misconception that we are ‘part of a billion-dollar conglomerate’ and/or ‘already very profitable, so why keep giving them money’ that is kind of frustrating for us: reddit was given its freedom when we were spun out, so the price of freedom is paying our own way and no one else is paying the bills – a graph like that might help make things more clear,” Wong said.
He went on to note that AdBlock hasn’t been much an issue in monetizing reddit, as only a small number of people run it and block reddit ads.
You can see all of Wong’s comments here.[via: Business Insider, Image: Yishan Wong]