Reddit is acquiring Memorable AI, a startup that uses synthetic artificial intelligence to help marketers create better ads, in its first acquisition since its IPO in March.
Memorable AI has developed technology to help advertisers find the most effective text, images, and videos to use in their sponsored posts, and Reddit hopes the acquisition will improve the quality of ads on its service.
“This acquisition allows Reddit to accelerate our work optimizing, creating, and managing ads to deliver even better results for advertisers,” Reddit chief executive Jen Wong said in a press release.
Memorable AI, based in New York, was founded in 2021 and uses AI to help marketers predict how often an ad will lead to a direct action, like downloading an app or visiting a website. Memorable AI Employees Will Join Reddit’s Ad Team Reddit did not disclose the financial terms of the deal, Reddit Acquires Generative AI.
Reddit has invested heavily in its advertising business and artificial intelligence tools. The company launched its first ads nearly two decades ago, shortly after Reddit was founded, but only began investing heavily in ad technology in 2018. Since then, the company has added a number of new advertising features, including shopping ads and video ads.
The social media site generates about 98% of its revenue from advertising and reported revenue of $804 million last year. Ads on Reddit appear in a number of places, including on the main news feed, in discussion forums called subreddits, and under user posts.
Reddit has also struck deals with artificial intelligence companies. It has signed $203 million in data licensing deals with companies including OpenAI and Alphabet' Google, to help train their AI models. In May, Reddit announced a deal with to ChatGPT, and to help the social media company add new AI features to its forums.
Reddit has previously acquired AI companies Spell, MeanCloud, and Spiketrap, startups that have helped the social media site improve content recommendations and ad placement..
