Reddit hit 1M users in 1 year. The key was listening to users—& not doing what they said. | Reddit CTO & Founding Engineer Chris Slowe

Reddit won users fast but took a decade to monetise

Reddit found product market fit almost at once with a bare front page of links and voting, and grew by word of mouth while staying tiny inside Condé Nast. Comments, subreddits and moderation tools arrived in layers, while revenue stayed an afterthought for roughly a decade. Slowe's later stories from Hipmunk and Reddit show how economics and team size became the harder problems.

Takeaways

• Reddit had product market fit almost immediately. The first version was only a front page of links with submission and voting, and no comments. It grew almost entirely by word of mouth and reached about a million monthly uniques in late 2006, doubling every three to six months.
• Features and community tools came in layers. Comments arrived in December 2005 and subreddits around 2007 and 2008. A simple ranking algorithm based on age and votes was open source from about 2008 to 2017, and moderation tools let communities build their own culture.
• Pseudonymity keeps users authentic and engaged. Slowe says pseudo-anonymity makes authenticity the norm because there is no reason to become an influencer. Support communities also keep users engaged. Google played a large role in growth only in the last five to ten years.
• Condé Nast bought Reddit and kept it small. Condé Nast acquired Reddit on October 31, 2006, pitching that it could monetise the content Reddit attracted. Advertising was a side thought. Reddit had no more than ten employees until 2011, and a 2008 company-wide freeze blocked hiring.
• Revenue came slowly and late. Revenue was trivial five years in. Reddit Gold launched in 2010 and raised about $100,000 in its first week. Serious focus on revenue began around 2015 and 2016, when rival ad platforms from the early 2010s left catch-up work.
• Hipmunk solved user problems but struggled economically. Hipmunk sorted flights by an agony score, but flights earn only a few dollars a ticket, so it moved into hotels. A small product could not win the bulk discounts large players enjoy, and Google Flights followed Google's purchase of ITA.
• Startups need experienced managers around Series B. Slowe says startups hit an adolescence phase around Series B and roughly 50 people, when products stop sticking and teams grow. They usually need to hire a real manager who has been a director before.

Early Y Combinator batch

• Slowe joined the first batch, which had only ten startups. Steve Huffman coaxed him into becoming Reddit's first employee about two months later.
• FlameOut, the batch's first company, broke up within three or four weeks over a dispute about equity.