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Discord is one of the leading free chat apps for game users. But have you ever wondered, “how does Discord make its money?” or “how does Discord work?” Anyway, we’ll be talking about them in bits, in this article.
After reading through this article, you will discover how the Discord app makes its money and how it stays at the top of its game. Just hang on!
Discord has over 200 million users. And simply put, in a nutshell, the Discord app makes its money by charging its users for using its updated features on the app. Its large user base attracts investor interest, and the sum of $493.89 million was generated by the company from venture capitalists.
So, let’s explore other things you should know about Discord.
What is Discord?
It doesn’t make so much sense to know how the Discord app makes its money without first having a piece of general knowledge about Discord. Hence, Discord is a free online voice, video, and text app created for gamers.
Discord was founded by Jaton Citron and Stanislav Vishnevskiy. It was established to give game users a platform to connect and interact with themselves without difficulty.
But before the advent of Discord, communication apps like TeamSpeak and Skype were used. However, these apps had their shortcomings which displeased gamers. This in turn prompted the inception of Discord.
Interestingly, Discord proved better than its antecedents and presently serves as an all-in-one messaging app for gamers. With Discord, you get to enjoy seamless interaction without the disruption of pop-up ads.
In addition, interest groups such as entrepreneurship, music, and art are beneficiaries of the Discord app.
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What are The Features of Discord?
While Discord is a free chat app for its users, you can use other available features just by paying a little token. So, let us look at some intriguing features of Discord.
- Various in-game overlays
- List of your friends
- Many channels
- Permanent free communication
- Free video chat
- Convenient for use on both a mobile phone and desktop
- Simple push notifications
- Protection against DDoS and IP attacks
- Several networks
- Client-server encryption
- CPU usage is minimal
- Reduced latency
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How Does Discord Work?
Discord servers host discussions with actual people in online spaces (that matter to them) known as servers. Its users can get into a group through video chat, voice call, or text and possibly connect with people if they share similar hobbies and interests. Minecraft and Fortnite are Discord’s most common servers, with each of them having about 500,000+ users.
How Does Discord Make Money?
How does the Discord app make its money? Well, just like we earlier stated, the Discord app is free to use. And this boosts the rate at which users sign up on the app.
The way any other company would do, Discord had to deduce a means of generating revenue. And this is when they came up with the Nitro package (in 2017). But since then, Discord has introduced other means of making money.
However, all the company’s enterprises haven’t turned out as planned. It formerly had a merchandise store where it sold Discord-branded apparel. Eventually, it was shut down two years after the operation.
It is not unusual for startups to experiment with different revenue models. However, some turn out positively while others do not. But currently, below are some ways the Discord app makes its money:
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1. Discord Nitro
The number one way Discord makes its money is via the Discord Nitro. It is a paid subscription package which Discord offers to its users.
The cost of using this service is $9.99 monthly and $99.99 yearly. But it has a cheaper edition called Nitro Classic. And it costs $4.99 monthly and $49.99 yearly.
With Discord Nitro, you will be given access to a vast game library and other advanced features which will be highlighted below.
- Create your custom emojis
- Animated avatars
- Screen sharing, high-resolution videos, and Discord Go live streaming
- Custom Discord tag
- Upload large files (of up to 100MB). The free version has a limit of 6MB.
- Personal profile
- Special Nitro profile badge
- Two server boosts with a 30% discount
- High-quality screen resolution
Discord earns money from Nitro. Again, you can test Nitro for free (for the first 30 days) and you can cancel at any time.
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2. Game store
Discord inaugurated its game store in 2018. With your Nitro subscription, you can gain access to exclusive games in the game store—the likes of Into the Breach, Dead cells, etc.
Although this model barely lasted, it was wiped out one year after it was launched. Shortly after, Discord swerved into a different model which involves allowing game developers to sell games on their servers.
To begin, developers’ servers must first be examined. After which they will have their server and game(s) promoted on the Discord platform to gain more exposure.
Now, how does Discord make money from game stores? The company earns money when a game is sold on its servers. They earn 10% from each game sale and the other 90% goes to the developer. For example, if a game is sold at $14.99, Discord gets $1.49 while the rest is for the developer.
3. Cosmetic items
This is another way Discord earns money—through the sales of cosmetic items. These items include sticker packs, sound packs, skins, and emojis. The items are majorly used for a more fun user experience.
4. Investments and funds
This is also part of how Discord earns money. Big companies support Discord, and this contributes to the revenue they generate. The money gotten is being used to enhance the platform and user experience as well.
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Discord Funding, Valuation, and Revenue
Crunchbase reportedly has it that Discord has generated a sum of $995.4 million across 16 rounds of investment capital funding. Their recent funding was generated from a secondary market round on March 12, 2022.
The company is funded by noteworthy investors including Arcane Group and Flat Capital (they are the most recent investors), Benchmark, Spark Capital, Index Ventures, General Catalyst, Accel, and Tencent (the creator of PUBG and League of Legends, etc).
Discord recently acquired three organizations—Sentropy Technologies, Ubiquity6, and Blitz App. The company was valued at $7 billion in December 2020. This denotes a 100% expansion from the $3.5 billion valuations that the company acquired in July 2020.
Discord’s Future Revenue Schemes
Even though Discord has made it clear that it provides its users with free messaging and chat services, the company also needs to come up with other techniques to generate revenue in order to stay afloat in the game market.
Hence, these are the expected means of generating revenue for Discord.
1. Game stores
Here, the game store allows developers to sell games on their servers and Discord gets a percentage for every sale. Those who subscribe to Discord Nitro are also entitled to these exclusive benefits.
This way, Discord makes money for the services it renders.
2. Revenue sharing
Discord can generate revenue by coming into partnerships with different gaming companies (for example, Twitch).
Again, gamers can be invited, and then those who were referred may buy games, cosmetic items, or maybe other features. This way, Discord could earn more money.
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3. Gamebridge
With a game bridge, game developers can integrate the application into their game and decrease the burden of coding an in-game application. Gamebridge has the following features:
- Community building
- Audio control settings
- Voice channels automatch players
- Positional audio
- Auto-create durable servers for game worlds.
Granted, the application went into exile a few months after it was launched, but the comeback would be worth it.
Bottom Line
Discord has long been attracted to many gaming companies (for investment) since its inception in 2015. I believe this article has answered your question on “how does Discord make money?”.
FAQs
Yes. Discord is free to use. Although it offers a paid subscription service which includes Discord Nitro. Some non-essential features like animated avatars, emojis, and badges are also not part of the free service
Discord servers do not cost anything—it’s free for every user (including free and paid users). Furthermore, Discord Nitro and Discord Nitro Classic users enjoy the benefits of hosting boosted servers.
As a Discord user, you can choose to stay anonymous by using a username other than your real name or using an impersonal picture as your profile picture. You can also choose not to use a profile picture or set your status to “invisible”.
According to bnnBloomberg, the Discord app is worth $15 billion.
Yes, Discord makes money from several means. The company earns money from its Discord Nitro subscription. Other sources of revenue include money earned from games sold in its games store, server boosting, and money earned from cosmetic items. Asides from these, the application is free to use, except if you want to get the premium features.
References
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