Reddit Strikes $60 Million AI Content Licensing Deal Ahead of IPO

The agreement with an unnamed AI company allows the use of Reddit's user-generated content for AI training, signaling a strategic move as the platform prepares for public trading.

Reddit has entered into a licensing agreement worth approximately $60 million annually with an undisclosed AI company, leveraging its vast user-generated content.
The deal is part of Reddit's strategy to increase revenue and enhance valuation ahead of its expected initial public offering (IPO) next month.
This licensing agreement could serve as a model for future contracts, potentially leading to more lucrative deals for Reddit.
The move comes amid growing interest in AI and follows Reddit's decision last year to start charging for API access, affecting both AI companies and third-party app developers.
Reddit's valuation for the upcoming IPO is set at around $5 billion, half of what it might have achieved in 2021 before a market downturn.