Reddit acquired Tik-Tok like app, Dubsmash, both companies confirmed on Sunday.
“Both Reddit and Dubsmash share a deep-rooted respect for how communities come together. Dubsmash elevates under-represented creators, while Reddit fosters a sense of community and belonging across thousands of different topics and passions.” Reddit CEO Steve Huffman said.
Dubsmash was launched in November 2014 in Germany. It immediately gained the top position. It raised $20.2 million from various investors like Eniac Ventures, Heartcore Capital, Index Ventures, Lowercase Capital and Sunstone Capital.
The company claims to generate more than 1 billion video views monthly.
Reddit claimed that Dubsmash is a welcoming platform for creators and users who are under-represented in social media.
The workforce of Dubsmash will also be acquired by Reddit for further growth.
Impact of Acquiring Dubsmash on Reddit
- This acquisition will lead to Reddit’s added feature in the app where the content creators or users will get to make new videos. It is yet not clear if it will be available for all platforms or not.
- It is notable that about 25 per cent of Black teens in the US use Dubsmash while females on the platform represent 70 per cent of total users. This acquisition will also lead to a boon in the content creation.
- It will develop the sense of belonging and community development.
Reddit was founded in 2005 in San Francisco. It was acquired by Condé Nast in 2006. In 2011, the site spun out of Condé Nast, whose parent Advance Publications retains a stake in Reddit. Last year Reddit raised $300 million in funding from investors including Tencent, Sequoia Capital, Fidelity and Andreessen Horowitz, with that valuing the company at around $3 billion.
Reddit has about 700 employees total. Dubsmash’s 12 employees, including co-founders Suchit Dash, Jonas Drüppel and Tim Specht, are joining Reddit.
Financial terms of the deal are not yet disclosed by either of the companies.