Reddit’s CEO Becomes a Billionaire: Steve Huffman’s 20-Year Journey from Startup to Profitable Giant

After nearly two decades of losses, Reddit has finally turned the corner—achieving its first quarterly profit a year ago and now delivering its strongest earnings report to date. The company announced on Thursday, October 30, a net profit of $163 million, marking five consecutive profitable quarters since its IPO 18 months ago.

The market responded enthusiastically: Reddit’s stock closed at $208.95 on Friday, up 7.5% from the previous day and 75% year-over-year. This pushed the net worth of co-founder and CEO Steve Huffman to $1.2 billion.

“Q3 results were strong,” Huffman said during Thursday’s earnings call, praising Reddit as a platform “created by humans, for humans” while taking a subtle dig at AI spam—low-quality AI-generated content cluttering the internet: “What makes Reddit unique is that we don’t want to be a copy of other products. Instead, we focus on being the best version of ourselves and what the internet needs most: a place where users can connect on any topic and access authentic, useful information.”

I. The Rise of a Trusted Information Hub

Reliable recommendations from real users have become a scarce resource today.

As bots and ad-driven content flood the web, Reddit has emerged as a more trustworthy source of information. Its popularity has surged in recent years, with daily active users nearly doubling since the summer of 2023. Reddit links now appear more frequently in Google search results—organic search traffic to the platform has jumped over 560% compared to two years ago, according to data from digital marketing firm Semrush.

It may seem surprising that Huffman joins the billionaire ranks so late, given that social media giants like Facebook, Twitter (now X), and Linkedin minted billionaires back in the early 2000s. After all, Reddit was the world’s seventh most visited website in September 2025, ahead of LinkedIn, TikTok, and Netflix, per Similarweb data. The reason lies in Huffman’s decision to sell his founding stake in Reddit back in 2006, when the company was still a startup.

Founded in June 2005, the company was sold to Condé Nast for $10 million about a year later by Huffman and his co-founder Alexis Ohanian—now a venture capitalist married to tennis star Serena Williams. The pair have admitted the sum felt like a fortune at the time. Lacking a monetization plan and struggling to manage the platform’s explosive growth with just a handful of employees, they saw the acquisition as a lifeline. While it solved their immediate problems, it cost them billions in long-term wealth: by 2014, the company was valued at $500 million.

Ohanian rejoined Reddit’s board in 2014 but left in 2020. He has stated he repurchased some shares during his tenure, but his wealth likely stems primarily from his investments in numerous startups. Huffman, however, now appears to be Reddit’s largest individual shareholder. That’s because Reddit lured him back in 2015 to address a series of operational crises.

Since then, his CEO compensation package has allowed him to accumulate 3.1 million shares, accounting for approximately 2.3% of the company. According to Forbes estimates, his wealth also includes Reddit stock options, plus $190 million in cash and other investments. Huffman declined to comment for this report.

II. Building a Profitable Business from the Ground Up

While generous equity incentives are common among billionaire CEOs—Tesla investors recently considered approving a $1 trillion compensation package for Elon Musk—it’s rare for an executive to amass such a substantial stake starting nearly from scratch.

In its 2024 IPO filing, the company explained that it significantly boosted compensation for Huffman and COO Jen Wong in 2023 after the original package “failed to achieve the intended incentive effects”—with Huffman’s pay soaring to $193.2 million.

He has certainly earned it. When Huffman took over as CEO in 2015, Reddit was in deep trouble. Its content moderation was overly lax, and some subreddit communities were rife with toxic speech and harassment. After Reddit fired a popular employee who served as the main liaison between the company and volunteer moderators, moderators protested by shutting down their subreddits—an event known as the “Great Reddit Blackout.” A week later, Huffman was brought in to take charge.

“At the time, Reddit had been around for 10 years with a ‘we don’t ban anything’ ethos,” he admitted recently on The Best One Yet podcast. “Breaking that tradition could only be done by a founder, because the management team was so scared to act. They told me: they were afraid any change would destroy Reddit.”

Huffman first implemented the platform’s first content policy, explicitly banning spam, cyberbullying, incitement to violence, and illegal activities. His team quickly banned a range of subreddits, including communities distributing child sexual abuse material and racist forums advocating for a “normal society free of the Black plague.” They also introduced a “quarantine” mechanism for legal but highly offensive content, requiring users to opt in to view such subreddits (e.g., r/PicsOfDeadKids, a forum featuring photos of deceased children, which was fully banned years later—a common fate for quarantined communities). The move aimed to improve the user experience while making the platform more attractive to advertisers (Reddit does not run ads on quarantined content).

Huffman and his team early on identified advertising as Reddit’s best initial monetization strategy, in part because ad revenue would allow them to keep the platform free. “He built the company’s advertising business from the ground up,” said Malik Ahmed Khan, an analyst at Morningstar.

One challenge was helping brands target ads effectively without undermining Reddit’s core anonymous nature. Unlike platforms like Meta and Google, which allow advertisers to run personalized ads based on demographic data and broader cross-site tracking, Reddit requires brands to rely on contextual cues. For example, if a user joins a parenting subreddit or upvotes pregnancy-related topics, the system may serve them ads for baby products.

So far, this approach has worked. Ad revenue reached $549 million last quarter, accounting for 94% of total revenue. When Huffman rejoined the company, total sales were only about $12 million to $15 million.

New challenges lie ahead. Reddit is at the center of several hot-button debates today, from the ethics of using user data to train AI models, to balancing free speech with content moderation, to the viability of text-based content in an increasingly video-focused online culture.

Huffman seems unfazed. “No matter what you’re going through, someone on Reddit has been there, done that, and shared their story,” he said during the earnings call. “Reddit’s best marketing is its own content.”

III. From Startup Dream to Crisis Leader

Huffman grew up in a small town in Virginia, not far from Washington, D.C., in a divorced family. He has said that starting and running his own business “always seemed within reach,” thanks in part to his father and stepfather—one a former engineer at General Motors with a bold entrepreneurial imagination, the other a former CMO at Unisys with a sharp financial mind. He learned to code at a young age, a hobby that led him to study computer science at the University of Virginia, where he met Ohanian. Before graduating senior year, the pair knew they wanted to start a business—they just needed a solid idea.

Huffman’s first concept was a mobile app for ordering food. While commonplace today, the era of mobile applications hadn’t yet begun. Their proposal, “My Mobile Menu,” was rejected by Y Combinator, the then-nascent startup accelerator. However, the pair left a strong impression on Paul Graham, Y Combinator’s co-founder, who asked them to submit a new idea. The second time, they succeeded. With a $12,000 grant, they spent weeks designing Reddit and launched it shortly after graduation. Huffman was just 21 years old.

Reddit then experienced snowballing user growth, and the pair worked 16-hour days before eventually selling the company to Condé Nast. Huffman served as interim CEO until he left in 2009, later co-founding Hipmunk, a travel search engine. Travel expense management company Concur acquired Hipmunk in 2016 and shut it down in 2020. Meanwhile, Condé Nast spun off Reddit again and brought in external funding, including from future OpenAI co-founder Sam Altman. However, the company struggled with monetization. That’s when Huffman made his comeback.

In addition to building ad revenue, Huffman’s early projects included redesigning the website and launching a mobile app. When he returned, Reddit had just 12 million daily active users—today, that number has grown to 116 million. Historically dominated by U.S. users, Reddit recently launched translation support for 30 languages, allowing global users to browse and post easily in non-native languages. This has driven a 31% increase in international daily active users over the past year.

IV. Monetizing AI and the Future of Reddit

Today, Reddit’s second-largest revenue stream comes from licensing its platform content for training AI models. The platform previously offered its application programming interface (API) for free, allowing developers to access on-site data. But starting in 2023, Reddit began charging for API access, cracked down on unlicensed bots scraping website data, and sued several AI companies—including search engine Perplexity—for allegedly scraping data without permission.

A handful of companies have already paid for access. Huffman signed licensing deals with Google and OpenAI last year, reportedly worth $60 million and $70 million respectively. Reddit’s vast library of real-time, human-generated content has proven highly valuable: according to data from AI analytics platform Profound, between August 2024 and June 2025, Reddit was the most cited source for Google’s AI Overview feature and the second most cited source for ChatGPT.

Given Reddit’s importance to AI models, these fees may seem relatively low. Alphabet, Google’s parent company (valued at $3.4 trillion), is expected to invest over $90 billion in AI infrastructure this year—meaning Google’s reported $60 million payment to Reddit accounts for just 0.07% of that.

“That price is just a starting bid,” said Colin Sebastian, a senior research analyst at Baird. “As Reddit gains more leverage in negotiations and the value of its content to AI models becomes clearer, I expect subsequent deals could be higher.”

However, a risk remains: while Reddit provides data to AI, it may also erode its own irreplaceability. As a hedge, Huffman launched “Reddit Answers” last December. He later told investors he hopes to make the platform people’s “go-to search engine.” When users submit a query on Reddit Answers, they receive an AI-curated list of results drawn from real user recommendations, complete with links to the original comments.

Huffman acknowledged that the rise of AI has temporarily impacted Google-driven search traffic to Reddit, but he remains optimistic about the future. “I think part of why Reddit is able to walk this tightrope is that language models actually need it to survive,” said Baird’s Sebastian. “The reality is these models can’t rely solely on synthetic data—they need a steady stream of human-generated content, which is hard to find. So Google and OpenAI have an almost perverse incentive to keep Reddit’s ecosystem alive and thriving.”

To experience the user experience firsthand, Huffman spends a significant amount of time on Reddit himself. He has posted thousands of comments and hosts “Ask Me Anything” (AMA) sessions. His most recent activity before the earnings report was on October 3, when he replied with a smiley face to a user who happily shared that they had bought 117 shares of Reddit during its IPO and the stock had since risen over 500%.

Original article:

https://www.forbes.com/sites/mon ... unding-the-company/

Would you like me to create a **one-page English executive summary** of this article, highlighting key milestones, financials, and strategic moves for quick reference?

Reddit’s CEO Becomes a Billionaire: Steve Huffman’s 20-Year Journey from Startup to Profitable Giant

After nearly two decades of losses, Reddit has finally turned the corner—achieving its first quarterly profit a year ago and now delivering its strongest earnings report to date. The company announced on Thursday, October 30, a net profit of $163 million, marking five consecutive profitable quarters since its IPO 18 months ago.

The market responded enthusiastically: Reddit’s stock closed at $208.95 on Friday, up 7.5% from the previous day and 75% year-over-year. This pushed the net worth of co-founder and CEO Steve Huffman to $1.2 billion.

“Q3 results were strong,” Huffman said during Thursday’s earnings call, praising Reddit as a platform “created by humans, for humans” while taking a subtle dig at AI spam—low-quality AI-generated content cluttering the internet: “What makes Reddit unique is that we don’t want to be a copy of other products. Instead, we focus on being the best version of ourselves and what the internet needs most: a place where users can connect on any topic and access authentic, useful information.”

I. The Rise of a Trusted Information Hub

Reliable recommendations from real users have become a scarce resource today.

As bots and ad-driven content flood the web, Reddit has emerged as a more trustworthy source of information. Its popularity has surged in recent years, with daily active users nearly doubling since the summer of 2023. Reddit links now appear more frequently in Google search results—organic search traffic to the platform has jumped over 560% compared to two years ago, according to data from digital marketing firm Semrush.

It may seem surprising that Huffman joins the billionaire ranks so late, given that social media giants like Facebook, Twitter (now X), and Linkedin minted billionaires back in the early 2000s. After all, Reddit was the world’s seventh most visited website in September 2025, ahead of LinkedIn, TikTok, and Netflix, per Similarweb data. The reason lies in Huffman’s decision to sell his founding stake in Reddit back in 2006, when the company was still a startup.

Founded in June 2005, the company was sold to Condé Nast for $10 million about a year later by Huffman and his co-founder Alexis Ohanian—now a venture capitalist married to tennis star Serena Williams. The pair have admitted the sum felt like a fortune at the time. Lacking a monetization plan and struggling to manage the platform’s explosive growth with just a handful of employees, they saw the acquisition as a lifeline. While it solved their immediate problems, it cost them billions in long-term wealth: by 2014, the company was valued at $500 million.

Ohanian rejoined Reddit’s board in 2014 but left in 2020. He has stated he repurchased some shares during his tenure, but his wealth likely stems primarily from his investments in numerous startups. Huffman, however, now appears to be Reddit’s largest individual shareholder. That’s because Reddit lured him back in 2015 to address a series of operational crises.

Since then, his CEO compensation package has allowed him to accumulate 3.1 million shares, accounting for approximately 2.3% of the company. According to Forbes estimates, his wealth also includes Reddit stock options, plus $190 million in cash and other investments. Huffman declined to comment for this report.

II. Building a Profitable Business from the Ground Up

While generous equity incentives are common among billionaire CEOs—Tesla investors recently considered approving a $1 trillion compensation package for Elon Musk—it’s rare for an executive to amass such a substantial stake starting nearly from scratch.

In its 2024 IPO filing, the company explained that it significantly boosted compensation for Huffman and COO Jen Wong in 2023 after the original package “failed to achieve the intended incentive effects”—with Huffman’s pay soaring to $193.2 million.

He has certainly earned it. When Huffman took over as CEO in 2015, Reddit was in deep trouble. Its content moderation was overly lax, and some subreddit communities were rife with toxic speech and harassment. After Reddit fired a popular employee who served as the main liaison between the company and volunteer moderators, moderators protested by shutting down their subreddits—an event known as the “Great Reddit Blackout.” A week later, Huffman was brought in to take charge.

“At the time, Reddit had been around for 10 years with a ‘we don’t ban anything’ ethos,” he admitted recently on The Best One Yet podcast. “Breaking that tradition could only be done by a founder, because the management team was so scared to act. They told me: they were afraid any change would destroy Reddit.”

Huffman first implemented the platform’s first content policy, explicitly banning spam, cyberbullying, incitement to violence, and illegal activities. His team quickly banned a range of subreddits, including communities distributing child sexual abuse material and racist forums advocating for a “normal society free of the Black plague.” They also introduced a “quarantine” mechanism for legal but highly offensive content, requiring users to opt in to view such subreddits (e.g., r/PicsOfDeadKids, a forum featuring photos of deceased children, which was fully banned years later—a common fate for quarantined communities). The move aimed to improve the user experience while making the platform more attractive to advertisers (Reddit does not run ads on quarantined content).

Huffman and his team early on identified advertising as Reddit’s best initial monetization strategy, in part because ad revenue would allow them to keep the platform free. “He built the company’s advertising business from the ground up,” said Malik Ahmed Khan, an analyst at Morningstar.

One challenge was helping brands target ads effectively without undermining Reddit’s core anonymous nature. Unlike platforms like Meta and Google, which allow advertisers to run personalized ads based on demographic data and broader cross-site tracking, Reddit requires brands to rely on contextual cues. For example, if a user joins a parenting subreddit or upvotes pregnancy-related topics, the system may serve them ads for baby products.

So far, this approach has worked. Ad revenue reached $549 million last quarter, accounting for 94% of total revenue. When Huffman rejoined the company, total sales were only about $12 million to $15 million.

New challenges lie ahead. Reddit is at the center of several hot-button debates today, from the ethics of using user data to train AI models, to balancing free speech with content moderation, to the viability of text-based content in an increasingly video-focused online culture.

Huffman seems unfazed. “No matter what you’re going through, someone on Reddit has been there, done that, and shared their story,” he said during the earnings call. “Reddit’s best marketing is its own content.”

III. From Startup Dream to Crisis Leader

Huffman grew up in a small town in Virginia, not far from Washington, D.C., in a divorced family. He has said that starting and running his own business “always seemed within reach,” thanks in part to his father and stepfather—one a former engineer at General Motors with a bold entrepreneurial imagination, the other a former CMO at Unisys with a sharp financial mind. He learned to code at a young age, a hobby that led him to study computer science at the University of Virginia, where he met Ohanian. Before graduating senior year, the pair knew they wanted to start a business—they just needed a solid idea.

Huffman’s first concept was a mobile app for ordering food. While commonplace today, the era of mobile applications hadn’t yet begun. Their proposal, “My Mobile Menu,” was rejected by Y Combinator, the then-nascent startup accelerator. However, the pair left a strong impression on Paul Graham, Y Combinator’s co-founder, who asked them to submit a new idea. The second time, they succeeded. With a $12,000 grant, they spent weeks designing Reddit and launched it shortly after graduation. Huffman was just 21 years old.

Reddit then experienced snowballing user growth, and the pair worked 16-hour days before eventually selling the company to Condé Nast. Huffman served as interim CEO until he left in 2009, later co-founding Hipmunk, a travel search engine. Travel expense management company Concur acquired Hipmunk in 2016 and shut it down in 2020. Meanwhile, Condé Nast spun off Reddit again and brought in external funding, including from future OpenAI co-founder Sam Altman. However, the company struggled with monetization. That’s when Huffman made his comeback.

In addition to building ad revenue, Huffman’s early projects included redesigning the website and launching a mobile app. When he returned, Reddit had just 12 million daily active users—today, that number has grown to 116 million. Historically dominated by U.S. users, Reddit recently launched translation support for 30 languages, allowing global users to browse and post easily in non-native languages. This has driven a 31% increase in international daily active users over the past year.

IV. Monetizing AI and the Future of Reddit

Today, Reddit’s second-largest revenue stream comes from licensing its platform content for training AI models. The platform previously offered its application programming interface (API) for free, allowing developers to access on-site data. But starting in 2023, Reddit began charging for API access, cracked down on unlicensed bots scraping website data, and sued several AI companies—including search engine Perplexity—for allegedly scraping data without permission.

A handful of companies have already paid for access. Huffman signed licensing deals with Google and OpenAI last year, reportedly worth $60 million and $70 million respectively. Reddit’s vast library of real-time, human-generated content has proven highly valuable: according to data from AI analytics platform Profound, between August 2024 and June 2025, Reddit was the most cited source for Google’s AI Overview feature and the second most cited source for ChatGPT.

Given Reddit’s importance to AI models, these fees may seem relatively low. Alphabet, Google’s parent company (valued at $3.4 trillion), is expected to invest over $90 billion in AI infrastructure this year—meaning Google’s reported $60 million payment to Reddit accounts for just 0.07% of that.

“That price is just a starting bid,” said Colin Sebastian, a senior research analyst at Baird. “As Reddit gains more leverage in negotiations and the value of its content to AI models becomes clearer, I expect subsequent deals could be higher.”

However, a risk remains: while Reddit provides data to AI, it may also erode its own irreplaceability. As a hedge, Huffman launched “Reddit Answers” last December. He later told investors he hopes to make the platform people’s “go-to search engine.” When users submit a query on Reddit Answers, they receive an AI-curated list of results drawn from real user recommendations, complete with links to the original comments.

Huffman acknowledged that the rise of AI has temporarily impacted Google-driven search traffic to Reddit, but he remains optimistic about the future. “I think part of why Reddit is able to walk this tightrope is that language models actually need it to survive,” said Baird’s Sebastian. “The reality is these models can’t rely solely on synthetic data—they need a steady stream of human-generated content, which is hard to find. So Google and OpenAI have an almost perverse incentive to keep Reddit’s ecosystem alive and thriving.”

To experience the user experience firsthand, Huffman spends a significant amount of time on Reddit himself. He has posted thousands of comments and hosts “Ask Me Anything” (AMA) sessions. His most recent activity before the earnings report was on October 3, when he replied with a smiley face to a user who happily shared that they had bought 117 shares of Reddit during its IPO and the stock had since risen over 500%.

Original article:

https://www.forbes.com/sites/mon ... unding-the-company/

Would you like me to create a **one-page English executive summary** of this article, highlighting key milestones, financials, and strategic moves for quick reference?