Reddit was started in 2005 outside of Boston, and is now headquartered in San Francisco. Its cofounders, Alexis Ohanian and Steve Huffman, built the platform within three weeks – they envisioned it as the “front page of the internet.” Less than two years after founding Reddit, they sold it to Conde Nast for an estimated $10-20M. Reddit is now majority-owned by Conde Nast’s parent company, Advance Publication, and was recently valued at $500M.
The crowdsourced platform essentially works like an online bulletin board. Registered users post comments and direct links on any imaginable topic, which are organized into subreddit (including world news, gaming, and ‘aww’), which Reddit refers to as “a platform for creating communities”, promising that “almost every subreddit is user-run, with practically no involvement from Reddit employees.”
With only 70 paid employees, it’s baffling to think about all the content that is created, but this is exactly where Reddit found its sweet spot. Its content (the bread and butter of their business) almost entirely relies on a volunteer user base of people who submit the most random comments I’ve ever come across (here’s an example: 5 ways to celebrate national cat day). But collecting sleuths of random people’s tangential comments is not enough to truly create value; Reddit takes crowdsourcing one step further by allowing registered users to up or down vote submissions, in essence curating vast amounts of information and allowing the most valued content to bubble to the top, without spending any money on it.
Reddit has 36M user accounts and over 200M monthly unique visitors to the platform. According to a 2013 survey, “6% of all American internet users had visited Reddit, [and] 15% of all men aged 18 to 29 used it.” To incentivize its users to participate in the crowdsourcing process, Reddit uses a point system of “karma” points that users can collect by submitting comments and links. It was difficult to find clear instructions of how this works online, so I took to Reddit as a newly minted redditor (for the purpose of research of course) and leveraged the community to find the answer. According to fellow redditor ‘lazydictionary’, the point system is “nothing except an ego booster. It has next to no use or purpose. Except having a low or negative karma rating in specific subreddits limits how often you can post there.”
Reddit also takes an innovative approach to managing the crowds on the 800K+ subreddits that have been created since its founding (note about 9,300 of these communities are currently active). It relies on its unpaid users to manage subreddits as moderators. Each subreddit apparently has its own set of rules and can have its own look and feel, depending on how sophisticated the moderators are in using CSS.
But Reddit also puts its paid labor to use in managing the crowds. Site administrators ensure that Reddit’s universal laws are adhered to across all subreddit communities, by “disallowing things like excessive self-promotion, posting personal information, and deliberate disruption or manipulation of other Reddit communities.” This is one of the platform’s great contradictions: it promotes free speech based on user generated content but at the same time it has to find ways to filter out the dark side of the internet that would make its shareholder cringe.