Founding Reddit

Steve Huffman and Alexis Ohanian, two college roommates from the University of Virginia, co-founded Reddit with a vision to make a difference. Initially, they attempted to create a food ordering app, which ultimately failed. Their original concept involved ordering food via SMS—a novel idea for its time.

Often, unexpected events lead to significant outcomes. For Huffman and Ohanian, this moment came during their senior year when they attended Paul Graham’s lecture on startup creation. Graham, who had previously sold his company to Yahoo, had not yet established Y Combinator.

The duo managed to pique Graham's interest, leading to a lunch meeting where they pitched their startup concept. Although he found the SMS ordering idea intriguing, Graham encouraged them to pivot towards web applications.

After facing rejection from investors, they returned to the drawing board. However, Graham believed in their potential and promised to fund them if they could present a viable web app idea.

Birth of Reddit

After numerous brainstorming sessions, Huffman and Ohanian devised a revolutionary concept: a platform where users could share stories and vote for their favorites, ultimately creating what they termed "the front page of the internet." They drew inspiration from Delicious and Slashdot, merging ideas to create a unique user experience.

The Y Combinator team embraced this new vision, accepting Reddit into their inaugural accelerator program. Following a brief three-week coding sprint, Reddit went live in June 2005, but they faced a significant challenge: no one knew about it. Competing against Digg, which had launched six months earlier, Reddit struggled to gain traction.

To generate buzz, Huffman and Ohanian adopted a “fake it till you make it” approach, creating numerous fake accounts to post links and simulate user activity. This tactic paid off.

Several platform design choices also facilitated Reddit's early growth:

• No Comments: Initially lacking a comments section made it easier to generate engagement without the hassle of managing discussions.
• No Categories: The absence of categories reduced barriers for users, encouraging them to post more freely.
• No Email Requirement: Unlike many platforms, Reddit didn’t require an email for registration. Users only needed a username and password, making entry seamless.
• Minimal Censorship: Huffman notes that the lack of strict content moderation (barring overtly racist posts) distinguished Reddit from its competitors, allowing users to discuss a wide array of topics, including adult content.

Growth

Reddit leveraged its connections to ignite its growth. A mention from Paul Graham in a blog post brought in their first 1,000 visitors, predominantly attracting a tech-savvy audience.

A pivotal moment occurred when Huffman and Ohanian logged in to find a link submitted by a user they didn’t recognize—an indication that real users were engaging with the platform.

Six months later, they partnered with Aaron Swartz, a gifted programmer who was developing Infogami. Together, they formed Not A Bug to help both Reddit and Infogami grow. However, as Reddit continued to thrive, the partnership strained, leading Huffman and Ohanian to focus solely on Reddit.

Reddit's user base grew to 500,000 monthly visitors, but challenges arose. After 16 months, Conde Nast, the parent company of prominent publications, acquired Reddit for nearly $20 million.

Alexis Ohanian, who later became known for his marriage to Serena Williams and his investment ventures, reflected on the pressures they faced during this period, which influenced their decision-making.

The Turning Point

A significant turning point for Reddit came when Digg made a critical misstep. In August 2010, Digg launched version 4, which faced backlash for its stringent content moderation and redesign that alienated users. This blunder opened the door for Reddit to capture dissatisfied Digg users.

Pillars of Growth

Reddit's unique structure has allowed it to retain users effectively. Here are the key factors contributing to its success:

1. Community: Each subreddit functions as a distinct community, allowing users to tailor their experience according to their interests. This fosters discussion and encourages regular engagement.
2. Consistency: Despite gradual improvements, Reddit has maintained a consistent user experience, appealing to its tech-savvy audience.
3. Seizing Opportunities: When Digg v4 launched, Reddit was ready to welcome new users, even creating a banner to greet them. By addressing competitors' shortcomings, Reddit effectively positioned itself as an alternative.

Where is Reddit Now?

Since its inception in 2005, Reddit's growth has been unstoppable. It has raised $1.3 billion in funding and is gearing up for an initial public offering.

With Steve Huffman as CEO, both he and Ohanian remain involved in Reddit's evolution. Despite challenges in monetizing its vast audience—reportedly generating $305 million in revenue in 2021 compared to Pinterest's $2.1 billion—Reddit shows no signs of slowing down. The company aims to simplify user onboarding and explore new markets.