#400 Reddit Founder: “I Wish I Still Owned Reddit Now” – with Steve Huffman

Many founders I interviewed on Mixergy told me about how their companies virtually disappeared after they sold them. But 4 years after selling Reddit to Conde Nast, Steve Huffman is so proud of how much its grown that he’d be happy to still own it.
I asked him to teach me how he grew his community, why some Y Combinator-backed founders, like him, succeed while others don’t get any traction and why he never resented his co-founder for getting so much attention.
I also asked Steve about Hipmunk, the travel site he launched which replaces the spreadsheet-like search results that most travel sites use with a more useful design.
Steve Huffman graduated from the University of Virginia with a degree in Computer Science in 2005. Immediately after leaving Virginia, he founded reddit.com with his college roommate, Alexis Ohanian.

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Walker Corporate Law – Scott Edward Walker is the lawyer entrepreneurs turn to when they want to raise money or sell their companies, but if you’re just getting started, his firm will help you launch properly. Watch this video to learn about him.

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Three messages before we get started.

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Here’s the program.

Andrew Warner: Hey, everyone. My name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious startup. And the goal here is to interview successful entrepreneurs about how they built their business, and today I’ve got with me a guy who I’ve talked about in several different interviews and I finally get to have the man here to talk to him directly in person.

So, with seed funding from YCombinator in 2005, today’s guest, Steve Huffman, co-founded Reddit, the social news site with over eight million monthly visitors. He sold it to Conde Nast in 2007 for an undisclosed amount. He’s back with a second startup which is also funded by YCombinator, HipMunk, which makes it easy to find flights based on your schedule.

I want to know why his company, why Reddit made it. I want to find out today in this interview about why other startups failed. I know that Steve’s been around the YCombinator community for a long time. I want to get his insight about why certain startups there failed, and I want to find out what he’s up to now. So, Steve, welcome to Mixergy.

Steve: Hey, thanks for having me.

Andrew: Cool. I had Alexis on here, your co-founder. He talked about Reddit. I had Paul Graham. We talked about you and Reddit. It’s so good to meet you in person, sort of, via Skype.

Steve: Great. Well, thanks. I’ll see if I can live up to those two.

Andrew: What’s going on now with Reddit and Digg? What big mistake is Digg making? I’m hearing from people who are now at the top of Digg who are saying they’re hardly getting any traffic. What’s the big mistake that they’re making?

Steve: I think Digg seems to be catering to the wrong crowd, either they’re acquiescing to investor pressure or just trying to change their product too much. Maybe they’re trying to compete with Twitter too hard. But what they’re not focusing on is what they had. What made them valuable was their community and their users who were powering that site. And they seem to be neglecting them, and the users are upset about that. That’s why they’re behaving so unruly or leaving. It’s left Digg in kind of a sorry state for the past few months.

Andrew: So, my question is then, the next question’s got to be why didn’t you guys crush Digg? You and Alexis and the whole founding community of Reddit was always in there. Even while Kevin Rose would travel the world and try different tea, you guys were on top of your program, growing your community. Why didn’t Reddit crush Digg?

Steve: Well, Reddit is crushing Digg now. I think they’re almost twice as large as Digg.

Andrew: In what way is Reddit now twice as large as Digg?

Steve: In traffic.

Andrew: Okay.

Steve: Uniques per month and page views per month. It’s my understanding. I don’t have direct access to Reddit numbers anymore, but from what the Reddit folks are saying, that seems to be the case. Why didn’t we crush them earlier like before Digg did us a favor and totally imploded on their own? It’s a good question. There’s a lot of reasons for that.

Digg, first of all, they launched before us. They had a pretty good start. They launched with a lot of PR, and they were very good at riding the PR wave of social news. They get a lot of credit for inventing that business, and they were very good at riding that wave of PR and taking advantage of it.

Reddit, we kind of played it cool. We were building a site for ourselves. We didn’t receive a whole lot of PR as we grew. It was mostly word of mouth and kind of a slow and steady growth.

Andrew: So, we lost the connection, and you were saying something.

Steve: Okay. What frustrated us a little bit was that we were always put in this position that if we were mentioned at all, we were always mentioned as being second fiddle to Digg. But we were also at the same time happy with the way we were growing and really loved our community and proud of the direction the site was going.

So, while things weren’t perfect, we would have loved to have been on top. We were also happy to have Digg be number one and take a lot of the heat for the cheating stories and gaming stories and all of that, and let us just kind of grow quietly.

Andrew: Those were all the stories about how people were cheating and gaming Digg and Ping for higher ranking. Is that what you mean?

Steve: Exactly.

Andrew: Okay. By the way, I pulled up on Compete.com, which is what made me drop the Internet connection, traffic numbers for both sites. It looks like Digg, according to Compete, has 6.8 million visitors a month versus . . . actually, you know what? I can’t tell what’s what any more because Reddit did release their numbers, and it showed that Compete’s data was inaccurate and it showed that no one really had it right.

Steve: Yeah. So, I can only speak for Reddit’s numbers, and they had nine million uniques last month.

Andrew: Right.

Steve: I wouldn’t put a whole lot of stock in Compete’s Digg numbers either. So, it’s hard to say here or there.

Andrew: Okay. All right. Screw that. I can’t figure out what Digg is doing from day to day, and I don’t think that seeing what’s Compete’s telling you is going to be useful. What is going to be more useful is how did you then grow the community? For a long time, people thought that you guys were copycats, that Digg was getting all the attention on the cover of “Business Week.” How do you grow community under that kind of environment?

Steve: Well, we did get called copycats, but I don’t think we were copycats at all.

Andrew: No, you weren’t. I had Alexis on here. He talked about how the idea for Reddit came about. No question in my mind that you guys were not copycats. But how do you grow a community the way that you guys do? You have an incredible community. I’d like to be able to do that.

Steve: It was all word of mouth. All of our users came organically, so we have a lot of genuine users. And Reddit can be a little off putting at first, either from the tone of the headlines or the comments or the design of the site. It doesn’t appeal to everybody. And so, the users who stick around stick around for the right reasons. They really like the content, or they like the way things work, or they appreciated what we were trying to build, which is just a simple, easy to use thing for consuming large amounts of content. And so, in that regard every user we had was really valuable. [interference]

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