The Reddit Story
Can you name Reddit’s CEO?
Did you guess Alexis Ohanian? You would be wrong. The famous husband of Serena Williams has cultivated a larger internet personality than the other co-founder of Reddit who is the actual CEO.
That would be Steve Huffman. The same Steve who coded the entire site in Lisp in a few weeks, after receiving a scathing email from Paul Graham as part of YC’s first batch (when it was still run out in Boston, not Silicon Valley).
Indeed, after Ellen Pao’s resignation in 2015, Steve has stepped into the CEO role and shepherded Reddit to a tremendous rise. Before the stock market’s sour turn at the start of the year, the company was set to IPO at something like a $15B valuation.
It didn’t seem like a ludicrous valuation, either. Over the course of its 17-year history, Reddit has grown to become a top 10 site in the world. It is estimated to have over half a billion monthly active users.
That makes it bigger than Twitter, Snapchat, Pinterest, and Netflix.
For being such a huge site, and one of the most important sites in tech, surprisingly little has been written about Reddit’s history. Just like no one can name the CEO, hardly anyone knows it was owned by Conde Nast for six years of its life.
That doesn’t mean the story isn’t great. It’s actually a crazy story - one filled with apocryphal lessons about product growth. I’ve spent the last few weeks using the Wayback Machine to dig it up. So, let’s dive in.
Chapter 1: Getting Paul Graham’s Support
As a college student at the University of Virginia, Alexis Ohanian was equally high-achieving and sharp tongued. He answered a first year college professor’s question of why he was there with, “I want to make the world suck less.”
A History and Commerce major, Alexis was planning for a career in law. Things were going well in that direction.
But one day, his junior year, Alexis got fed up with an LSAT practice test. He left, opting to eat out at Waffle House. There he had his “Waffle House Epiphany.” He wanted to make a dent in the universe.
One of his buddies, Steve Huffman, agreed. A computer science major, Steve was constantly coming up with software product ideas. Alexis realized building one of these ideas was a much better path to making a dent in the universe.
Their junior year, Steve shared with Alexis a problem he felt strongly about: ordering food through his phone
He had the idea at the gas station Sheetz. He had already ordered food through a touchscreen without human service. But he couldn’t order through his phone. This frustrated him, because he want to order while pumping gas to save time. He shared his frustration with Alexis, and Alexis’ response was, “we should totally build that.”
The duo hired a lawyer and got to building Reddit. Alexis had the company incorporated, and Steve got to coding. Steve was reading the programming book, “On Lisp,” by Paul Graham (the founder of Y Combinator), as he planned to build the site in Lisp.
In spring break of their senior year, Paul was coming to Harvard to speak. Steve was excited and wanted to go. He wanted his copy of “On Lisp” signed. Alexis had never heard of Paul. He wanted to go to Mexico to party with the rest of his friends. But, he supported his co-founder and followed him to Cambridge, MA. The duo hopped on a train going north, the opposite direction of the rest of their classmates going south to party.
Paul Graham’s talk was, “How to Start a Startup” (a talk he has updated and still gives.) It came at the perfect time for the college duo just having started a startup. After the talk, Alexis was helping Steve get his book signed.
But Alexis was also inspired by the talk. So he said to Paul, “It would be great if we could buy you a drink to talk to you about the startup we just started. We’ve come all the way from Virginia,” at which point he was cut off by Paul. “You’ve come all the way from Virginia?” he asked. Upon seeing them nod, he agreed to dinner.
Chapter 2: Launching Fast
At dinner, Paul liked the idea. He told the duo they should apply to a new investment vehicle he was starting, Y Combinator. The two agreed.
They prepped the presentation and waited for Y Combinator to start.
Months later, they took another train up to Boston to pitch Y Combinator. They give the pitch. They competed with the rest. They thought they would be shoo-ins. They had talked to Paul.
They were not. That night, Alexis and Steve got the call that they were not going to be accepted. They were shocked and dejected. They got drunk and decided to go home.
The next day, they hopped on a track back to Virginia. While they were on the train, Paul called them. He said if they got off the train right then, and came right back, Y Combinator would fund the pair.
The catch? It would be a different idea. It was an amazing ask from Paul. And the young college students did it. Alexis and Steve got off at the next stop, to head right back.
When they finally got to Boston, Paul explained himself further. “Don’t do mobile phones,” he said. At the time, there were no app stores. So, distribution was very tough. Instead, he suggested the duo build a web app.
The three began talking about what web app to build. They realized that content was being built by such a broad array of surfaces, that the internet needed a new front page. In the discussion, Paul crystallized it, “you guys need to build the front page of the web.”
The idea was to cross del.icio.us, with its social bookmarking features, with Slashdot, which “actually had good content,” according to Steve. It would be a community driven news website, with the fate of the content decided by anonymous user votes.
After graduation, the two moved into an apartment in Cambridge, MA. With the $12,000 from Y Combinator, they set out to build the front page of the internet. They had been working on it for two weeks when Paul sent them a scathing email. He questioned why they hadn’t launched yet.
A week later, in June, Steve wrote back that the basic service was up and running. Without any notice, a few days later, Paul published his next essay.
He explained his hypothesis that it cost less to start a startup than most thought. In it was a link to Reddit as an example of a product that had already launched. He mentioned the team had worked “ridiculously hard.” That got Reddit its first 1,000 visit day. By force of will, Reddit was started.
In the early days, to seed content, Alexis and Steve were the top posters themselves. They built fake accounts to give users the impression the site was bigger than it was. They were doing things “that didn’t scale.”
They wouldn’t need to do so for long. By August, they no longer had to seed content. The site was growing on its own.
This capture from the Wayback Machine highlights the state of Reddit. It was a quirky site with lowercase tab menu text: eg, ‘hottest’ instead of ‘Hottest’.
Subreddits did not yet exist. The login box took up 15% of the real estate, and there were not embedded pictures or videos.
A few months after launch, Steve and Alexis were soon joined by another Y Combinator graduate, Aaron Swartz. A prodigious programmer, he helped the duo accelerate feature releases.
One of those features was comments, which was released after a contentious debate. The comments section quickly became an integral part of Reddit.
Chapter 3: Subreddits
At the end of 2005, a Yahoo executieve invited the founders to Silicon Valley for a meeting. He asked them about their traffic, to which the duo replied truthfully. In turn, the executive said:
You are a rounding error compared to Yahoo.
The duo felt punched in the mouth, but used the harsh words as motivation. Alexis printed out, “You are a rounding error” and pinned it on the wall.
It became fuel for the team to release new features. One of those was Subreddits, which the team released in October 2006,. It would prove to be a turning point for Reddit. r/science and r/programming became particularly popular.
Chapter 4: Conde Nast
Perhaps because of the inadequacy the team felt with comments like the Yahoo exec’s, and perhaps because Alexis’s mom was dying of cancer, the duo began acquisition talks in mid-2006. The talks culminated in a sale to Conde Nast just weeks after the launch of Subreddits. It was for $10M. As Alex put it:
I thought I was getting away with something, because, for 16 months of work, I was getting more money than my parents had made their entire working lives.
Remarkably, the duo stayed at the company for three years. This ensured the nascent website kept growing at a tremendous pace.
But, it was not all easy. Reddit had to outgrow some of the team. Aaron blogged complaining about the new corporate environment. In January 2007, he was fired (he tragically committed suicide in 2013).
Despite the corporate environment, Steve and Alexis stayed on. They actually felt they were given tremendous latitude, with just quarterly check-ins.
In 2008, the company released the ability for anyone to create a subreddit. This led to an explosion of new subreddits and news about them.
Despite the growth in Subreddits, the company’s fate was not yet clear. In early 2008, TechCrunch wrote a piece saying, “it is not easy being No. 2.”
Digg seemed to be winning the war for the front page of the internet. While Digg had millions of unique monthly visitors, Reddit was still toiling below one million.
It’s especially not easy being No. 2 as a founder in a corporate parent. In January 2009, Steve and Alexis left Reddit.
But the team did not give up. The chairman of Conde Nast, Steven Newhouse, understood technology businesses. Conde Nast tried its best to leave Reddit alone and let the company pay attention to its community. Steve held quarterly meetings with the company, but more or less, left it to grow on its own.
And, grow it did. The same month Alexis and Steve left Reddit, the Ask Me Anything Subreddit was created. It was an instant hit, with famous people participating regularly. Meanwhile, the company moved from physical servers to Amazon Web Services and relaunched its mobile experience to fit the changing times.
From a product point of view, the company was singing. It was also pushing forward on monetization. In 2009, the company launched sponsored content and a self-serve ads platform. Then in 2010, it launched Reddit Gold, a premium subscription without ads.
This deep-dive was a bit too long for email. Get the rest of the story:
Process Goldilocks as PM
Too much process is hell. Too little is chaos.
10 process spectrums for PMs to strike the right heavy/light balance:
Process is like salt. Too much and the dish tastes bad. Too little and you can’t taste anything.
As a PM, you must advocate for just the right amount of process. That’s why you need to understand the spectrum at these 10 points, as it relates to PM work involved.
1. Quarterly planning
Heavy: Begin as soon as the last one ends, Validate with specs for eng & design effort, Have analytics impact size, Get everyone’s input
Light: Do in a few weeks, Product estimates for effort & impact, Small working group validates
2. Sprint planning
Heavy: Product triages tickets, Team grooms backlog with analytics, Team story points, Team plans sprint
Light: Product shares strategy, Product trusts engineers to prioritize, Eng manager story points and plans sprint, Eng build
3. Creating JIRAs
Heavy: Long form, Product triages & creates, Eng accepts
Light: Few required fields, Eng manager triages, Eng creates based on breaking down tasks, Eng drives
4. Designing
Heavy: Product creates mock & goes through all flows and edge cases, Design builds visuals, Product coordinates eng questions
Light: Design creates mock, Design and eng go through flows, Design builds, Design and eng self coordinate
5. Driving Execution
Heavy: Product writes detailed PRD, Design creates usability prototype, Product drives user tests, UAT & readout
Light: Team decides on feature, Design creates, Eng drives tests, Analytics drives readout
6. Running UATs
Heavy: Product identifies cases in PRD, writes UAT cases & runs UAT, Engineering makes fixes
Light: Eng identifies cases, Design validates, Eng builds to design, Eng writes tests
7. Launching
Heavy: Product gets okay from cross-functional stakeholders, publishes date, switches feature flags, checks with analytics to ramp
Light: XFN stakeholders involved, Product shares date, Eng switches flags, Analytics checks numbers
8. Running Experiments
Heavy: Product creates experimental design, creates hypothesis, justifies resources for experiment, drives analytics spec
Light: Team always runs experiments, Team hypothesizes, Analytics creates spec & success criteria
9. Measuring Results
Heavy: Product defines success criteria, references dashboard for numbers, and justifies deep dive to analytics, Analytics delivers
Light: Team defines success, Product has dash, Analytics drives deep dive, Analytics sends results
10. Post-Mortems
Heavy: Product identifies need, schedules and runs meeting, takes notes, sends out
Light: Eng identifies need, Eng schedules & runs meeting, Team takes notes, Eng sends out
Most companies with a “proof of work” culture for PMs lean on the heavy side for all 10. It’s a recipe for turning PMs into delivery managers.
It doesn’t have to be that way. Places like Meta lean light for all 10.
Flex to heavier or lighter as needed to drive success. The processes matter less than the outcomes they drive.
Great piece AG, thanks for this.