Reddit, the popular online discussion platform, is aiming for a valuation of up to $6.5 billion in its upcoming initial public offering (IPO), according to sources familiar with the matter. This valuation is a step down from the $10 billion mark the company achieved in a 2021 funding round, reflecting a more conservative approach amid changing market conditions.

The company is reportedly considering a price range of $31 to $34 per share for the IPO. The offering will include both new shares issued by Reddit and existing shares held by investors and employees. This strategy allows Reddit to raise fresh capital while providing an exit or partial exit for existing stakeholders.

Reddit’s decision to lower its valuation expectations comes at a time when the company is focusing on narrowing its net losses, which were reported to be $90.8 million, and boosting its revenue, which grew approximately 21% in 2023. These financial dynamics are crucial as Reddit prepares to go public, nearly two decades after its inception.

The platform, known for its diverse and vibrant communities, allows users to vote on content, contributing to its distinctive user-driven content curation model. However, despite its significant user engagement and cultural impact, Reddit has historically lagged behind other social media giants like Facebook and Twitter (now X) in terms of commercial success.

Reddit’s IPO is poised to be a significant event, testing the market’s appetite for a platform that has played a unique role in the digital content and community space. As the company moves forward with its public offering, investors and industry observers will be closely watching how Reddit’s valuation and market performance evolve in the context of broader trends in the tech and social media sectors.