Everything you said is accurate and can be summed up as “investors should have no faith in Huffman at the helm”, which is enough to tank a growth stock like Reddit is supposed to be.
Quite honestly, as someone who has done deep value investment analysis for fifteen years, I’ve never seen a company purposely do anything as self destructive as what Reddit did, particularly before going public as part of it’s IPO roadshow phase. These guys are amateurs and it shows.
- their software stack was relatively simple and easy to maintain
- their moderators were volunteers who worked for free & loved their job (as opposed to FB who are hiring them for 30/hour)
- their expenditures were very low for a company of that scale.
- third-party developers built great apps for free and boosted the site, and this was when Reddit team didn't have the resources to build a proper app of their own (they ended up acquiring Alien Blue, one of the favorite apps of that time and adopted it as their mobile client)
They had a huge presence for minimal expenditure, and they let it all go with more & more short-sighted decisions. Quite sad to see something just decay like this.
Hi, out of curiosity: could you share some of that deep value investment analysis - even if it is outdated - or even better, perhaps some of the methodology or heuristics?
Quite honestly, as someone who has done deep value investment analysis for fifteen years, I’ve never seen a company purposely do anything as self destructive as what Reddit did, particularly before going public as part of it’s IPO roadshow phase. These guys are amateurs and it shows.