Reddit Co-Founder Alexis Ohanian Steps Aside, Focuses on Initialized Capital
Full text:<p>Reddit Co-Founder Alexis Ohanian announced on Wednesday he will step down from daily duties at the internet company and focus his attention on Initialized Capital, the early stage venture capital firm that he co-founded and is known for investments such as Coinbase and Instacart. He will continue to sit on Reddit’s board.<p>Mr. Ohanian, 34, said the timing of his decision reflected a number of personal and professional factors, including his marriage last year to tennis superstar Serena Williams and the birth of their daughter, Alexis Jr. Mr. Ohanian said the decision also reflected his confidence in Reddit’s renewed growth, and his desire to focus his professional energy on investment opportunities in emerging technologies such as blockchain.<p>“I had a pretty productive last year, personally, when it came to getting married, as well as having a baby,” Mr. Ohanian told CIO Journal. “I came back from parental leave at the start of January, and really started thinking about where I wanted to be, what I wanted to be doing.”<p>Reddit was in stronger shape, he said, claiming that it boosted revenue fivefold during the last three-plus years since he had re-engaged with the company. Reddit, which has been ranked as the fourth most popular U.S. internet site, raised $200 million last year and was in good hands with co-founder Steve Huffman as CEO, he said. The company, launched in 2005 and backed by Y Combinator, says it was valued in last year’s funding at $1.8 billion.<p>This year will see a continuation of the company’s strategy to make Reddit more welcoming, according to Mr. Huffman. That includes an updated website, scheduled to launch in the first quarter, as well as initiatives to personalize the site for individual users, and to improve its chat functionality. “We’re basically rebuilding the entire product,” Mr. Huffman said. “We have a long way to go there.”<p>Mr. Ohanian has said that the future of social media lies in more authentic communication. At a time of growing concern about social media standards, the values of free expression and community can be at odds, though. “Our goal for Reddit is to create a platform where people can express themselves authentically and also to build a space where everyone can find their home — we evolve our policy regularly to maintain the balance between those two values,” Mr. Ohanian said.<p>The decision also reflected early-stage investment opportunities for Initialized, which he co-founded in 2011 with Palantir Technologies veteran Garry Tan. Initialized said it has more than $250 million under management, and that its portfolio is worth more than $20 billion. Its investments include Coinbase, Instacart, Zenefits, Opendoor, Soylent and Cruise Automation, now part of General Motors Co.<p>Startups today are in the early stages of building the infrastructure for the next wave of applications, many of which likely will run on decentralized networks rather than a central server, according to Mr. Tan. He compared the opportunity to early years of the internet, when basic infrastructure was being built. “The big thing now is the people creating the infrastructure are getting to share in the spoils,” due to the rise of cryptocurrencies, Mr. Tan said.<p>“I want to have a chance to invest, often the first check, in companies that are going to create the new internet,” Mr. Ohanian said.<p>Given its early stage focus, Initialized eschews investment theses and focuses on fundamentals such as vetting software, products and founders, according to Mr. Ohanian.<p>“There are clearly things around security and privacy and identity that are going to be dramatically changed through technology, just because it’s now possible,” Mr. Ohanian said.<p>One opportunity, he said, is that people may have direct control over the currency in their possession, without having to rely on a third party to store it. He views distributed exchanges as a way to make that possible.<p>He also said that such changes in trading and ownership will extend to other kinds of digital assets.<p>“Crypto Kitties is probably the best-known example right now,” he said, referring to the blockchain-based game. “I know it seems silly. But it’s a demonstration of the fact that you can create a digital thing of which only one can exist and be able to prove that it exists. Where people end up taking this and what it ends up being, that I can’t predict. But the means of exchanging those seems like an obvious next step.”<p>The ability to establish authorship opens up new opportunities, according to Mr. Ohanian. “This idea that you can identify ownership or authorship is interesting. We don’t have any really good solutions for this,” he said. “I take a photo, it could end up in a million places on the internet tomorrow, with everyone else taking credit for having shot it. It would have been nice to have had that at the beginning of the dot-com boom. We weren’t capable of having that. But we actually can have it now.”