By Zoe Kramer

While Discord used to appeal only to a niche community, nowadays there’s a good chance you might have heard of it. 

While Discord is still used predominantly by the gaming community it was initially designed for, it has also been used by other groups with common interests, like study groups and even hiking groups. Especially during the pandemic, Discord is appealing in that it offers text, video and voice chats for those who can’t meet in person.

And this widespread appeal hasn’t gone unnoticed. Microsoft was recently in talks to potentially buy Discord for a reported $10 billion (roughly £7.28 billion). Ultimately, the deal fell through and Discord chose to move forward as a standalone company. But what could bring Microsoft to offer such a staggering price in the first place? Well, Discord is doing something that Microsoft has tried before, but they’re doing it better. 

From their attempted purchase of TikTok last year to their failed video game streaming platform Mixer, it’s clear what Microsoft wanted. They wanted a social media aspect to integrate into their Xbox platform. And now, they might have to find it elsewhere.

So how did we get here, and what caused Discord to attain such a high value? It starts with the debut of the app in 2015. Discord was founded by CEO Jason Citron and Stanislav Vishnevsky and is based out of San Francisco. It wasn’t Citron’s first company, though. He had previously sold a mobile gaming platform, OpenFeint, for $104 million. 

Both companies benefited from the fact that gaming is becoming less of a basement hobby and more of a mainstream form of media. Some even make it their job, with competitive e-sports as well as streaming. This might explain why Discord grew exponentially, with 9 million daily users only two years after its launch and now with a reported 140 million monthly active users.

Still, it’s remarkable that Discord has been valued so highly, because its interface involves no ads. Almost every other social platform has adopted ads in some form: it balances out the revenue lost from allowing people to join for free.

Discord only makes money from its premium service, Nitro. This creates an odd disparity. While Discord is not profitable at present, it has still reported a 188% increase in sales year on year. In other words, while it’s not profitable now, in a few years it could be.

“We believe that people's data is their data and that people should feel comfortable and safe to have conversations and that their data is not going to be used against them in any way that is improper,” Citron said in an interview with NPR.

This attitude might be part of the reason why Discord’s ever-growing user base is so loyal. They don’t feel as though they’re being used for their information, or for ad revenue. And for that reason, they’re likely here to stay. After all, Discord is always continuing to add features, such as the new Stage Channels, which allows someone to broadcast their audio, kind of like their own radio show. 

Discord is not afraid to innovate, and even without the Microsoft purchase, it’s certainly not going away any time soon.