Alexis Ohanian Launched Reddit In 2005, Now He Owns Competitor Digg: Should RDDT Stock Investors Be Worried?

The idea for Reddit (NYSE:RDDT) came to entrepreneur and investor Alexis Ohanian more than two decades ago while at a Waffle House restaurant. Fast forward to 2026, and Ohanian is now taking his former company head on with the relaunch of Digg. Digg Vs. Reddit Ohanian's Reddit was once a main competitor of Digg, a company that didn't have the lasting success, but hopes to come back strong with its relaunch. Now co-owned by Ohanian's Seven Seven Six and Digg co-founder Kevin Rose, Digg is hoping to be the internet community in ways similar to Reddit. Rose and Ohanian acquired Digg in a March 2025 leveraged buyout, with the relaunched platform entering public beta this week after an early-access launch, TechCrunch reported. Digg hopes to capitalize on utilizing AI for good and not being overrun with AI bots and spam. "Handmade by human hands using machines," a tagline for the company reads. Ahead of the public beta launch, Digg started 21 generalized communities and gained around 67,000 users through an invite-only phase. In public beta mode, users will now be able to sign up and join communities or create their own communities on any topic. Community managers for topics will set rules and provide public moderation logs, helping to fulfill Digg's goal of being transparent. Digg also offers a public algorithm. "Just crossed 1,000 new communities in 4hrs," Rose tweeted after the official launch. The post could suggest a strong initial interest in Digg's relaunch, which could be bad news for Reddit. Trouble For Reddit Stock? Reddit shares fell Thursday, but it was likely due to an analyst note and not the Digg launch. RBC Capital said there could be upside for Reddit, but competition is tightening. That competition likely refers to other social media communities and doesn't take into account the launch of Digg. Reddit ended the third quarter with 116 million daily active unique users, with the company saying that 444 million people visit the site weekly. Those large numbers likely include a mix of loyal users, those who like the style of the site and connecting with people who have similar interests. Digg could win over consumers by being the new kid on the block and focusing on things that may not have worked for Reddit in the past or are not working for the company now. While Ohanian hasn't led Reddit for many years, he likely has the inside scoop on what worked and didn't work for the company. Similarly, Rose watched Digg have early success before fading away. Combine those two figures with a team of people betting on AI and communities, and Reddit investors should be on watch. Reddit has beaten analyst estimates for revenue and earnings per share in each quarter since going public in March 2024 and shares continue to trade significantly ahead of their IPO price of $34. RDDT Stock Price Reddit stock closed Thursday down 9.36% to $228.75 versus a 52-week trading range of $79.75 to $282.95. Photo: Shutterstock