That's a successful company by any standard.
> That's a successful company by any standard.
Simply being "valued" at some dollar amount doesn't actually mean success. Revenue and positive net profit mean success...
I think you're conflating "impressive" and "successful." I would say that based on the numbers you've given, Reddit is an impressive company (it's hard to get any company to that level of private investment and internet fame!), but it's not necessarily a successful company yet.
Being that Reddit's valuation is solely attributable to private investment and not revenue generation (so far), the only sound way to judge whether or not it is a financially successful company is based on its potential return to investors.
By the standards of most VCs in tech, a $500M exit is suboptimal, which will result in either a modest return or just getting their money back. This is not good for a firm's "batting average" when they're trying to beat the SPY with a ten year fund. They need to cover their losses (which, indutry-wide, represents approximately all of their investments), their staff and business continuity costs, their management and performance fees and still beat the market. Modest returns aren't helpful in that regard.
You also have to consider the likelihood that Reddit will transition into a mature business that can exist profitably on its own, without continually receiving significant infusions of cash. If it can't find a way to navigate out of "tech adolescence" it's not really a successful company. The last numbers I read indicated that Reddit has achieved an annual revenue of $8-10M, which is an annual return of >= 2%. Considering that the S&P's average annual return is about 7%, you could earn $10M on $500M by sticking it into an index fund and literally burning the other $25M you would have generated by doing nothing.
That's why I would say it's a success to everyone but the investors who never got their payday.
Yes, so it would not be a successful venture backed company. Lifestyle businesses are fine if you pay for them. When someone else invests and expects a return you need to provide a return to be successful.