It’s a question that many have asked: how does Discord make money? Seeing as it’s a free service, with no advertisements on it, it really begs the question of how the company could possibly generate revenue. Let’s take a look at how they make money, and how they got to this point in the first place.
Discord promised in 2016 to never run ads. This is the go-to for most free services. Facebook, Twitter, YouTube, and other popular free websites rely on advertisers paying for ad placement in order to maintain revenues. This would have been the easy way out, but we’re sure that everyone is relieved that Discord will never be full of flashing ad banners. Similarly they have stated that they are not in the business of selling user data, mentioning that the “if you’re not paying, then you are the product” sentiment does not apply to their operations. The core features of Discord will always be free, no matter what else the company decides to roll out.
A big part of how Discord is able to operate with little forms of revenue is venture capital. When Discord was still young in 2016, it raised $20 million through Greylock Partners. This money was used to expand their staff. Reports show that in 2017 Discord raised $50 million through Index ventures, and will likely raise more capital in the near future. All in all, Discord has raised $79.3 million in funding.
League of Legends is a success story of monetizing something free. The game can be played to its full potential whether you pay or not. You could pay real-world money to buy additional champions, but none of that made a person better at the game. Other people spent their money on cosmetic items, as most champions have at least half a dozen skins. In a similar move, Discord features plenty of optional cosmetics such as special emojis, sticker packs, and skins. These items can help Discord make money on a free product without offering too unfair of an advantage to those people.
A small point, but worth stating nonetheless. Discord sells t-shirts, hats, and other branded merchandise and presumably makes a bit of money off of selling these items to devoted fans.
The paid option of Discord is called Discord Nitro, and is a small set of extra perks that is mainly aimed at people who want a way to support Discord and contribute to its future. For $4.99 a month or $49.99 a year, you can have access to additional bonus features, as well as the warm fuzzy feeling in your heart of supporting a tool you enjoy using. Currently this subscription comes with an animated avatar, higher quality screen share, custom emojis in any server, animated emojis, a boosted upload limit, and a badge showing how long you’ve supported Discord. Outside of the boosted upload limit, these are all purely cosmetic and are just small rewards for essentially donating. Still, it is a way for loyal fans to help Discord make money if they want to help out.
What Does the Future Hold?
Many critics are worried about Discord’s business model. Like many free online services, the tool often comes before the revenue, and startups rely on venture capital before finally figuring out how to turn a profit. It wasn’t until 2016 that Twitter actually made a profit and it has been around since 2006. So, Discord’s profitability may not be readily apparent, and it could be a bumpy ride as they try to navigate the best ways to make money off of their users. They have grown incredibly fast since starting just a few years ago, so there is a ton of potential!
This post is in no way an advertisement for Discord or a call to help Discord make money. However, if you have been enjoying the free service, want Discord to stay afloat, and have some disposable income to throw at them, you may want to! Ask yourself “if Discord wasn’t free, how much would I be willing to pay for it”. If you do support Discord currently, let us know how in the comments below.