The social media platform Discord is grabbing the spotlight in 2021 as the company is in talks with Microsoft for a sale value of $10 billion.
Discord claims to have more than 140 million users on a monthly basis, which generated 100 million in revenue last year. According to Wall Street Journal, the valuation of the company has doubled last December to $7 billion. According to Crunchbase, it has raised a total of $480 million from investors including Greenoaks Capital.
Discord was founded by Jason Citron and Stan Vishnevskiy, programmers and entrepreneurs in 2015 as a platform for video gamers to chat while playing. The free service creates a gamer-friendly environment for users to broadcast video games and offers communication via text, video, and voice. The pandemic has accelerated the popularity of Discord as more gamers were looking for safe ways to communicate and socialize. More recently, Discord has become a communication hub for communities including the Black Lives Matter movement, book clubs, homework help, and more.
Unlike other social media generating revenue from advertisements such as Twitter Inc., Discord generates revenue through subscription services called Nitro. Members can customize tags next to their usernames, stream higher quality video and upload larger files for only $10 a month.
Discord’s biggest selling point to Microsoft is its varied communities that have attracted users from all age groups. Microsoft, which had an interest in buying TikTok and Pinterest Inc last year, is looking to add assets that build thriving communities of users. Moreover, there’s the probability that Microsoft may seek to integrate Discord with Xbox Game Pass as a video-game subscription service.
However, according to someone familiar with the matter, Discord could be better off by going public than selling itself.
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