Discord was started in 2015 as an online destination for gamers to chat, but now has become a mainstream channel for all kinds of communities to connect and hangout online.
MAUs. The app now has around 150M monthly active users (MAUs) up from around 56M in 2019, due at least in some part to people flocking online during the pandemic.
Revenue. Discord generated an impressive $130M in revenue in 2020, a significant boost from 2019 revenue of $45M. That’s great growth and all, but at this scale, the challenge for the company is continuing the trajectory and also making a profit.
Ad-free business model. Despite the massive growth, Discord has remained true to its core ideal of not monetizing its users’ data, pursuing an ad-free business model instead. Here is a deeper dive into how that business model works, courtesy of CB Insights reporting.
1. Subscriptions
This is where the meat of the $130M came from – although not explicitly disclosed, estimates are that Discord has around 1M paying users. Discord communities are built around ‘servers’ which have text and voice channels that let users connect and share content. These are free to use, but premium users get perks. They have two subscription options:
Nitro, the premium subscription package, is available at $9.99 per month or $99.99 per year. You get:
- custom and animated emojis
- a custom tag and an animated avatar
- two server Boosts and 30% off when buying extra Boosts
- a special badge to show how long users have been supporting Discord
- upload size of 100 MB per file
- high-resolution screenshare and Go Live streaming
Nitro Classic is the cheaper option at $4.99 per month or $49.99 per year where you get Nitro minus a server Boost.
2. Everything else
- Distribution fees from game stores
Discord gets 10% off of the sales of titles sold through verified servers.
- Tickets for virtual events
In a new feature being tested, users can sell tickets for virtual events. No decision has been made on Discord’s share of those ticket sales.
- Stickers and merchandise
Animated stickers that cost between $1.50 and $2.25 started selling in October 2020. Paying users get a 33% discount on all sticker purchases.
It will be an interesting experiment to watch and see if a business that is not built on cashing in on users’ data can scale to the size of the incumbent big tech companies that do.
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