Discord Valuation: Confirms $100M Raise at $7 Billion

The increasing importance of virtual communication in our daily lives continues, and a recent funding announcement highlights a company benefiting from this trend. Discord, the chat and communications platform widely used by gamers and a growing number of other individuals, has confirmed receiving an additional $100 million in funding as it reaches 140 million monthly active users – a doubling of its user base compared to the previous year.

Sources familiar with the matter have verified that this funding round values the company at $7 billion, representing a doubling of its valuation in just six months.

Earlier today, reports indicated the company was seeking up to $140 million in a Series H funding round, potentially reaching a $7 billion valuation, as documented in filings and reported by Prime Unicorn Index. This funding round remains open, and it is understood that Discord may secure an additional $40 million in this phase, though the initial portion has been announced now.

“We are incredibly grateful for the growth we’ve experienced among the many diverse and thriving communities that have chosen Discord as their preferred platform,” stated Jason Citron, co-founder and CEO, in a released statement. “Looking ahead to 2021, we are enthusiastic about our future plans and intend to utilize this funding to further enhance Discord, benefiting both our free users and Nitro subscribers.”

Greenoaks Capital is leading this investment round, with Index Ventures also confirmed as a participating investor.

“Discord provides an exceptional environment for communities to connect, whether for gaming, sharing interests, or collaborative projects,” commented Neil Mehta, founder and managing partner at Greenoaks Capital, in a statement. “We are confident that Discord will continue to evolve alongside the ever-changing landscape of online interaction, ultimately uniting billions of people globally. We are pleased to continue our long-term partnership with Jason, Stan, and the entire Discord team.”

Reports from PrimeUnicorn align with previous reporting from several weeks ago. Sources had previously indicated a potential valuation of up to $7 billion for the company at the end of November.

Confirmation regarding the final valuation for this round is still being sought.

This latest funding round has been the subject of speculation for some time, with some characterizing it as a “pre-IPO round” for the privately held startup. Documentation from Prime Unicorn indicates a recent price per share of $280.2487, compared to $144.1809 in the Series G round.

Past investors in the company include Greylock, IVP, Spark Capital, Tencent, and Benchmark, among others. With this additional $140 million, the total funding raised by the startup will reach $420 million.

The size of this fundraise reflects the continued significance of virtual communication tools in modern life, as well as the substantial growth of Discord itself.

Discord initially gained recognition as a communication platform designed to seamlessly integrate with popular online games – a result of its origins within Jason Citron and Stanislav Vishnevskiy’s Hammer & Chisel gaming studio. It began as a means for their teams to coordinate strategies and details while playing games, both their own creations and those of other developers.

The platform quickly gained traction within the Twitch community and among esports players, providing a valuable space for both participants and viewers to offer real-time commentary on events.

However, like the most popular games and gameplay experiences, the platforms used by gamers can appeal to a broader audience. Discord’s growth has been remarkable in recent years, with monthly active users doubling to 140 million this year, and experiencing 800,000 daily downloads.

This growth is attributable, in part, to the platform’s popularity alongside recently viral games like Among Us, but also to its expanding use cases beyond gaming.

Earlier this year, the company secured $100 million in funding at a $3.5 billion valuation. At that time, Citron and Vishnevskiy acknowledged that the platform had surpassed – or at least expanded beyond – its initial gaming focus:

“We discovered that, for many of you, it was no longer solely about video games,” they explained, describing Discord as “a place to connect and converse comfortably within your own communities and with friends… a space for meaningful conversations and quality time, whether catching up, learning, or exchanging ideas.”

This expansion into broader “communities” has not been without challenges. Discord has faced ongoing scrutiny regarding the presence of undesirable elements, such as white supremacist groups, on its platform. The company asserts that this issue is diminishing and highlights the platform’s role as a hub for Black Lives Matter organizers and other social media influencers. However, some remain skeptical, suggesting that this is an ongoing problem requiring continued attention, similar to other social platforms.

“Discord is consistently present among these groups on the far-right,” Joan Donovan, a lead researcher on media manipulation at the Data & Society Research Institute, stated to Slate some years ago. “It serves as the primary location for organizing doxing and harassment campaigns.”

The swift succession of this $140 million funding round, following the previous round just six months ago, underscores the company and its investors’ ambitious plans to develop more robust and efficient tools not only for gamers but for all internet users – a pursuit that requires significant investment.

Progress in this area is already evident, as demonstrated by the recent expansion of Discord’s screen sharing functionality to iOS and Android devices, beyond desktop platforms (a notable development considering Twitter’s recent acquisition of Squad).

“Unlike Facebook’s approach of delivering raw content, [Discord] fosters a shared experience for you and your friends,” noted Danny Rimer of Index Ventures, who led the $100 million round earlier this year. “We anticipate that Discord will replicate Slack’s success in transforming professional communication within the realm of social conversation.”

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

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Updated with confirmation from Discord