Discord is hugely popular chat app for gamers, and the company is seeking to move into selling games as well. Back in October the company launched the Discord Store for games, meant to rival the massive Steam Store. And now Discord has announced that it has secured $150 million in funding, with a valuation of $2.05 billion.
The last time Discord raised cash was in April of this year, when they raised $50 million in funding at a $1.65 billion valuation. The company has only grown since then, as the influx of further cash and higher valuation demonstrate. The latest funding came primarily from investment group Greenoaks Capital, as well as from other funders like Firstmark, Tencent, IVP, Index Ventures, and Technology Opportunity Partners.
With this cash injection, Discord will expand the scope of their store. The store gained more attention recently when Discord announced that it would split revenue from game sales with the developers for self-published titles at a rate of 90/10, making it a more attractive option financially speaking than the 70/30 split offered by Steam. The Discord Store is definitely smaller in scope and audience than the behemoth Steam Store right now, but Discord is showing that it is looking to close that gap.
The main focus of Discord will continue to be its chat service, which allows users to talk via text or voice and is a common tool used by clans, guilds, and other gaming groups. The chat service is offered for free for all users but has an option to purchase a “Nitro” subscription that gives benefits like unlimited access to a library of games and extra features in chat. At $10 per month, Nitro could be a compelling option for gamers who want to play through a lot of titles without having to shell out for each one. However, the catalogue of games available skews more towards indie and casual games, which may not be appealing to Discord’s primary audience of hardcore gamers.
The investment in the Discord Store opens up another avenue of funding for the company, and is a smart move to monetize the gaming audience that Discord has access to thanks to its popularity as a chat interface.
