After Twitter, Fidelity slashed the value of its Reddit equity stake by 41% since its investment in August 2021.
The news is huge for Reddit, given that Fidelity was the platform’s biggest investor in its funding round in 2021. At that time, the asset manager spent $28.2 million on Reddit shares. Now, the investor’s stake in Reddit reportedly dropped to $16.6 million on April 28.
The news follows Fidelity’s announcement involving its Twitter markdown. According to the investor, Twitter is now just worth 33% of the $44 billion price that Tesla CEO Elon Musk paid for the company’s acquisition. The Twitter investor first marked down the value of its equity stake in November, and further reductions followed in December and February. According to Bloomberg, this latest markdown removes $850 million from Musk’s $187 billion-worth wealth.
In related news, Reddit’s new API pricing structure threatens to shut down third-party apps, including the famous Apollo app. In his recent post, app developer Christian Selig shared that the new policy could cost him up to $20 million annually. Selig said he asked Reddit if they could be “flexible” with the pricing, but the company stood firm in its decision. This caused disappointment among fans, who now call the company “greedy.”
