Conception of Reddit and how Y Combinator literally “gave the idea” to the founders
Initial traction, metrics and how they reached there
No real sharp point of Product Market Fit in Reddit’s journey
Did you know that the idea for Reddit was not conceived by its cofounders?
Did you know that almost all of Reddit was just porn shortly after its first year?
Did you know that it did not have any traffic for the first month of its launch?
Well, I didn’t. And here is my attempt at retelling Reddit’s early history in as brief as I can.
What’s Product Stories?
- “Best product people are historians of their industry” – Jeff Morris Jr
“Product Stories” is my attempt to write about origin stories of some popular products and cover some of the less covered aspects of startup products like their metrics when they had just started, how long did it take to finally take off, how fast or slow were they in launching v1 of their product, initial target market and how they stumbled upon it, their failed experiments, etc.
How The Idea Was Born?
This product story starts with a “rejection”. Reddit was officially started when Paul Graham rejected Alexis and Steve’s idea for investment as part of Y Combinator’s first batch. Instead, he showed them Slashdot (a social news website then) and asked them to build something similar and he would give them $10k for the summer to work on it.
This part of Reddit’s journey is interesting because often in the non-startup world, the idea is romanticized a lot; and in the startup world, it’s almost the opposite. In the startup world, people often believe ideas are dime a dozen, it’s the execution that matters.
While both being true, I feel the ability to pick and recognize great ideas does not get enough credit (not for investors but founders). I wonder what would have happened if Alexis and Steve would have stuck to their original idea of “food ordering app” and worked on it a couple of years only to realize it was early.
Probably they would have been too burnt to start another company then. Lots of startup journeys end up this way because of the founder’s chose the wrong market for them. Luckily for both of them, they had Paul Graham guide them to the right market/idea.
Even though the idea was a copy of an existing product, they did not blindly copy it. They took the idea from Slashdot/Delicious but realized early on that it would be the recommendation system (the upvote/downvote mechanism in their case) that would be key.
The lesson here, it’s okay to copy as long as it’s mindfully done.
Especially since building a consumer tech company is catching lightning in a bottle and if you try to be original all the time in all your features, you might be in for a tough ride. It’s easier to copy things that work and try to deliver the most value to your user with your use case. Another case in point, Instagram taking “Stories” feature from Snapchat, and then using to enable the next wave of content creation on Instagram.
Idea To MVP: No Users After The First Month Of Launch
They built the prototype and launched it within 20 days. 20 days is really fast even by today’s standards (when a lot of standard libraries exist and development time has drastically reduced).
To do it back in 2005 is really a splendid task. One really needs to internalise the “Launch fast and iterate” philosophy of building products in order to do that. Apparently, Paul Graham used to mail them twice a day “checking in” for progress, which made them push harder to launch (fine line for an investor, but alright!). Reddit would be a classic example of “launch fast and iterate” model of building products.
This is what it looked like after the first 5 minutes of launch:
Notice that there were no subreddits and no commenting. But they did have Karma points (Reddit’s gamification mechanism where users get points for submitting content to the site) from the very beginning.
Often products launch gamification as an afterthought to increase their retention/engagement, but here is an example of a successful company that did it from the start. I am sure it helped in building “the community” that eventually became their differentiator.
Reddit now has subreddits as a way to group content/people, threads, upvoting/downvoting on comments, moderator control features, karma points, Reddit Gold and so many more features. But they started it all with just a mechanism to submit links and earn Karma points.
Another point to note is that they did not have any major traffic for a month after launch. (crazy by today’s standards but it was 2005. Simpler times!)
Chicken And Egg Problem For Marketplace Startups
Almost every marketplace startup (which has stakeholders on both sides of the value chain) faces this problem. Why would people post favourite links to Reddit if there are no readers? And why would readers come if there are no good links posted?
Reddit solved this problem the way most startups nowadays do. Solving for demand first and seeding the supply side. They themselves posted links in Reddit’s initial days. But the interesting strategy they used was – they used different usernames to submit the links, in order to give an illusion to the users that there were already a lot of users submitting links.
This strategy has become commonplace nowadays with almost every marketplace startup using it, but the founders should get credit for thinking out of the box, back then in the day.
They got their first couple of hundred users after a month of releasing it when Paul Graham posted Reddit’s link on his blog. But the first couple of hundred users that Reddit got, were not just any users. They were all the internet’s power users.
Reddit reached 1mn monthly readers(MAU) and 70,000 daily readers(DAU) 16 months after it was launched (7% DAU/MAU; which is terrible considering today’s standards for a consumer startup but thankfully Reddit persevered).
This is interesting as when Reddit was started, metrics such as DAU/MAU were not very popular. Retention was not the most important thing every consumer founder looked at. Analytics tools for measuring these metrics also did not exist. This ignorance I think turned out to be bliss for Reddit as well some of the other less instantly viral products of the time.
Too much focus on metrics in the early days of a startup leads to a lot of self-doubt in founders. Partly because founders compare their crappy metrics (which are always crappy as it is early days of their product) with metrics of successful products. It might more productive to look at subjective user feedback instead of chasing metrics during the early days. There is still merit in looking at metrics and being aware of it, but optimizing too much of them early on might not be the best strategy for all.
MVP To PMF: No Sharp Point Of PMF
The most interesting thing about Reddit’s journey is that – at no sharp point can you say that they hit a Product Market Fit and everything changed post that. It has always been a relatively slow and steady growth for them. Reddit had only a couple of hundred users within the first 2 months.
Maybe they had the so-called PMF from Day 1 or they never really cared for PMF. They believed their product was what users wanted and kept on building for them not caring much for whether they are pre-PMF or post-PMF.
I believe a lot of startups go through unnecessary self-doubt (and thereafter distracting experiments; often killing startups) thinking that they have not reached PMF while all they needed to do was keep on working for their users.
That said, Instagram in comparison got 1 million users within 2 months.
Snapchat had 127 users after 6 months of founders working on it, but in Dec 2011 when they find their right audience (i.e. high schools in North Carolina and Silicon Valley) they go from 2000 users to 20,000 users in a month. 100k a couple of months later.
Reddit was neither an instant hit or found a sharp turning point in its journey. It has always been steady.
Another important aspect of Reddit’s early history is the growth of different genres inside it.
While it was initially built around solving for the founder’s problem of going through various news websites to find popular trending news, it quickly expanded to other forms of content discovery.
Founders’ earlier thought of using “tags” as a system of segmenting and organizing content (like Delicious was already doing) but Huffman was completely against it as he thought they were very subjective. What might be considered “politics” by one person might be tagged as “left-wing liberal bullshit” by another. That’s when they came up with “subreddit” as a way of categorizing. They ended up grouping users instead of content.
Reddit And Porn
NSFW was one of the major early subreddits that was started. It still contributes around 10% of Reddit but back then it may have been the reason for Reddit’s continuous growth. Another example of “Do things that don’t scale”?
“NSFW subreddit” is interesting as it was not a subreddit that users themselves started. It was a deliberate action taken by the founders. They realised that while it might not be something Reddit stands for (at that time which was social news), they still chose to go ahead with it.
This may have been because those were very early days of Reddit and they would have been happy with whatever users came as long as it was growing. Which I believe is fine. Sometimes founders become too idealistic in their vision that they don’t try out anything which deviates even slightly from their vision (thanks for all the gyaan of “focus on the vision”).
Sometimes at the early stage, you got to whatever it takes to get users and figure out the rest later. Its a fine line and everyone would have different definitions of where they draw the line but can sometimes do wonders. Even if it does not lead to anything meaningful for the product, it might just give enough confidence to the founder to persevere longer.
You can see the chart of various subreddit’s submissions over the years:
Reddit vs The Competition
Reddit was not the first social news company that was started. Yes, back then Reddit was called a social news site. It is now called a community / social network.
While the inspiration of Reddit came from the utility of Slashdot (news for nerds community) and Delicious, it grew continuously while others failed.
Every one of them had different reasons for their failure (which can be all individual subsequent posts).
In the case of Delicious, one of the major reasons turned out to be that Delicious was being used more as a utility for bookmarking webpages, which meant its content was generally longer reads which people saved for later (as opposed to current and trending topics on Reddit).
Digg died because of different reasons but one of the major ones being self-promotion on Digg. On Reddit, self-promotion—say, posting your own personal blog and voting it up from multiple user accounts you’d created—was considered spamming. On Digg, however, there were loopholes often gamed by users, networks of friends, and newsrooms.
4chan still exists but it has evolved into more for toxic communities which somehow Reddit has been able to handle in spite of so many unfortunate instances.
Reddit was also self-policing with users themselves downvoting as they considered themselves a part of the community.
AMA And Reddit TV
AMA(ask me anything) has become one of the most talked-about features of Reddit over time with even Barack Obama doing an AMA. AMA was one of the first subreddits that was started and was organically evolving as users made it into a Q&A community.
The initial success of AMA inspired Alexis (Reddit co-founder) to build a separate video Q&A platform as opposed to textual AMAs that were already happening. He dedicated quite a lot of time building it but it never took off. One of the reasons was the cumbersome process as it took sometimes 8 weeks to edit a video Q&A session.
Another reason for its failure was the fact that it was something Alexis was doing without getting his co-founder and the entire team on board. While sometimes its easier to get things done faster alone but in the long run if the whole team is onboard it leads to amazing things. It’s better to do the hard thing of convincing everyone in your team early on than trying to do everything on your own (easier to get started but becomes difficult later on).
The failure of Reddit video Q&A product is another reminder that consumer startups are hard and it is extremely difficult for even previously successful ones to recreate their magic.