A Reddit Redo
On Sunday, Alexis Ohanian (Reddit co-founder) and husband of tennis superstar Serena Williams, took the time to reminisce about Reddit’s past and its $10 million sale back in 2006. Compared to the $3 billion valuation given by internet company Tencent in 2019, it makes sense why Mr. Ohanian still reflects on this business decision.
Alexis shared his thoughts on Twitter and said: “… on Halloween 2006, we sold @reddit to Conde Nast… the deal was months in the making and I wish I’d had more advisors around the table giving me more perspective on the sale…” As fellow Invstrs, the concept of looking back and analyzing past mistakes is one much too common. As they say, “Hindsight is always 20/20”.
By taking a closer look at Mr. Ohanian’s life back in 2006, his decision to sell Reddit for such a price was practical and understandable. First of all, Reddit wasn’t something he had spent a lifetime creating. The $10 million dollar offer came after 16 months’ worth of work. Ohanian had this to say on the topic “I thought I was getting away with something because for 16 months’ worth of work, I was getting more money than my parents had made their entire working lives.” A very understandable thought process for a man who graduated from college just 1-year earlier.
With the many internal and external factors at play during this time in his life, the one that “weighed on him the most” was his mother’s health. According to Alexis himself,
“She was diagnosed with terminal brain cancer just a couple months into founding the company, so the idea of rewarding her life-long unflagging confidence in me with a $10 million exit was tremendously appealing.”
Business is already hard enough. When you account for the difficulty in our personal lives, it’s brutal. An important lesson to be learned from Mr. Ohanian is that people must seek guidance during these tough times. Sure, you can train your mind to have the proper perspective overtime but there is no shame in asking other credible people about what they think you should do. Sometimes, the people on the outside are the ones with the clearest view.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
