Discord reveals that $100 million was earned, sources say at a cost of up to $7B - Tech Backbone

 

Discord reveals that $100 million was earned, sources say at a cost of up to $7B 

- Tech Backbone

In our socially-distant lives, the field of virtual interactions appears to have a central location, and today it seems like one of the businesses collecting some of the spoils is even collecting some funding from it. Discord, the gamers' wildly popular chat and communication platform and, increasingly, many others, has confirmed to us today that it has raised $100 million more in funding as it reaches 140 million active monthly users, twice the number it had a year ago.

 

"Among so many incredible and diverse communities that have made Discord their place to hang out we are humbled and honoured by the growth we have seen," said co-founder and CEO Jason Citron in a statement. "As we look to 2021, both our free service and our Nitro subscribers are excited about what we have in store and plan to use this funding to help make Discord even better." 

This round is led by Greenoaks Money, and we've checked with sources that Index Ventures is also participating.

"Neil Mehta, founder and managing partner at Greenoaks Capital, said in a statement, "Discord is the perfect place to gather with your communities, whether to play video games, share recipes, or work on a project. We assume that, alongside constant progress in the ways people communicate, Discord will expand and develop, eventually linking billions of people around the world. We feel honoured to maintain our long-term friendship with Jason, Stan and the whole team at Discord.

Earlier today, we announced that according to paperwork submitted by the firm and revealed by Prime Unicorn Index, the company was in the process of raising up to $140 million in a Series H round at a value that may be as high as $7 billion.

At the end of this post, we have the documents attached. We have asked to see if the round is still available, considering the difference between how much it reveals today and how much it files to raise.

The analysis from the analysts seems to validate our own findings from a few weeks earlier. By the end of November, sources had reported to us that the group had earned up to 7 billion in valuations.

We are still trying to validate whether this is indeed the valuation of this round.

For a while this new funding was speculated, and some described it as a "pre-IPO round for the private-backed startup. Discord's most recent price per share in the documentation is $280.2487, with the Series G valued at $144.1809, notes Prime Unicorn.

Greylock, IVP, Spark Capital, Tencent and Benchmark, among others, were former investors in the business. The overall sum earned by the start-up will stand at $420 million with an additional $140 million.

The fundraiser, and the scale of it is a testament to the rise of Discord itself, not just to how interactive networking technologies prove to be an integral part of our lives these days.

Originally, Discord made its name as a chat channel that could exist alongside popular online games in a simple way, a byproduct, perhaps, of how it first came into being. As part of their Hammer & Chisel gaming studio, Discord was started by Jason Citron and Stanislav Vishnevskiy as a way for them and their teams to convey strategy and other knowledge to each other when playing games (their own games, games of others, all games).

It went on to get a lot of attention on Twitch and with e-sports teams, places where it could be highly interesting for players and viewers to have a way to focus on what is happening.

But just as there is mass-market, though casual, appeal for the biggest games and gameplay, so will the channels that players use to connect. The rise of Discord has accelerated in recent years, with monthly active users with 800,000 downloads a day doubling to 140 million this year.

In addition to recently, virally popular games like Among Us this is partially due to Discord's use; but also because it is used for more than just games.

Earlier this year the firm had already earned $100 million on a $3.5 billion valuation, and Citron and Vishnevskiy noticed at the time that the network had already outgrown its gaming origins or at least found room for something more than:

"It turns out that it was no longer just about video games for many of you," they noted, describing Discord as a place designed to hang out and talk in the comfort of your own communities and friends... a place to have real conversations and spend quality time with individuals, whether catching up, learning something or sharing ideas."

The growth has not been without its teething pains within "communities." Discord has on its website a high profile, continuing battle with unsavoury forces such as white supremacism. The firm believes that this is on the wane, and that the forum is now a home for organisers of Black Lives Matter, fewer politicised influencers on social media, and more. Some are not so sure, so maybe it's a topic that needs to be discussed, like it is on every media network, not a finished storey and will continue to be addressed.

"[Discord] offers a shared experience for you and your friends instead of throwing raw content at you like Facebook," said Danny Rimer of Index Investments, which led the $100 million round earlier this year. "We will come to appreciate that what Slack has done for professional conversation is done by Discord for social conversation."

Prime Unicorn states that the Series H terms provide a pari passu liquidation preference with all other preferred, and conventional convertible meaning that if there are remaining proceeds, they will not participate with common stock."