Social communications platform Discord is now preparing to enter the public markets with guidance from Goldman Sachs and JPMorgan, according to sources close to the matter. The San Francisco-based company, founded in 2015, has not confirmed a specific timeline, but people familiar with the discussions say Discord could begin trading by the end of this year.
Although Discord originally explored a direct listing, its current plan appears to favor a more traditional approach to going public. The shift marks a significant development for a platform whose popularity soared during the global pandemic. This surge in demand bolstered Discord’s user base beyond its original niche of gamers and programmers.
The company’s financial growth supports the move, with annualized revenue reportedly quadrupling to more than $600 million between 2020 and 2024.
Discord’s revenue model relies on both user subscriptions and advertising partnerships with video game companies. A subscription service called Nitro, costing $3 to $10 per month, offers premium features such as custom emojis and larger file upload sizes.
Video game developers also pay for the platform’s advertising services. Last week, Discord launched its Social SDK, which integrates its social features into games like Marvel Strike Force, a title developed by Scopely Inc.
In recent years, however, Discord has faced regulatory scrutiny in several countries, including bans in Russia and Turkey. In the US, the app has also come under criticism for occasionally serving as a meeting space for extremist groups.
Despite these concerns, Discord’s track record of attracting prominent investors remains intact, having raised $1.1 billion so far. Its backers include Index Ventures, Greylock Partners, Benchmark, Accel, and Spark Capital.
In 2021, the company rejected a $12 billion acquisition offer from Microsoft and later secured a valuation of $14.7 billion in a subsequent financing round.
Information for this story was found via Bloomberg and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
