Discord Was Once The Alt-Rights Favorite Chat App. Now Its Gone Mainstream And Scored A New $3.5 Billion Valuation – Forbes

By shutting out white supremacists and reinventing itself to be more accessible, Discord has added millions of more diverse usersteachers, Boy Scouts, book clubs, Black Lives Matter protestorsand landed a $100 million infusion from investors.

When Black Lives Matter protests began in Dallas near the end of May, Maria Santibanez, 26, decided she wanted to join. Yet details about planswhere theyd meet, where theyd go, where theyd endwere scattered across the internet. Santibanez stumbled on a social media platform called Discord, a five-year-old video-and-voice chat app thats a cross between Reddit and Slack. There she joined Dallas Protests Collective, one of more than two dozen Discord groups devoted to Black Lives Matters. (Others include ones called Woke Black Nerds and All Cops Are Bastards.)

This one in Dallas was dedicated to organizing events and proved to be a useful repository of information. It now has around 1,000 people, and Santibanez is its chief leader, spending much of her past month directing people to it whenever she sees someone online asking about information on the demonstrations. Most of us were not experienced with Discord, but were learning and got things set up, says Santibanez, who works for Enterprise in its corporate rental fleet. Its been awesome to see it grow organically, like a patchwork quilt.

Its a bit discordant to think about Discord being used by Santibanez and other Black Lives Matter activists. The ironically named communication app started its life attracting far, far different crowds. It was founded in 2015 to make it easier for gamers to talk while playing video games and gained notoriety as a home for the Alt-Right two years later when white supremacists used it to orchestrate that summers Charlottesville protests. Caught largely unaware, Discord only worked to expel the racist groupsafter the protests ended with 34 people injured and a woman dead, mowed down by a car.

Discords founders CEO Jason Citron, 35, bearded and bespectacled, and Stan Vishnevskiy, 31, the scruffy-faced chief technology officer, willingly admit to missteps through Discords first few years. Youre going to make mistakes, says Citron, speaking publicly about Charlottesville for the first time. As long as it doesnt kill you, you learn from it.

While Discord is still a place rife with gamings school-yard culture, parts of it unwelcoming to anyone not straight, white and male, it has transformed into something much more mainstream since 2017. Well over 30% of its userssome teens but the majority of them 18 to 44now go to Discord for something other than gaming. Through the app, teens trade informal messages, as they do on Snapchat, and assemble study groups, a habit that has increased since the pandemic closed schools. Book clubs gather through the video-chat function. Boy Scout troops are using it to communicate while social distancing. Teachers have relied on it to complete virtual lessons. And protesters have used it to organize. What were doing is less about gamesmore about bonding, chatting, hanging out, says Vishnevskiy.

Discord started life as an app for gamers then became known as an Alt-Right haven. It's now being used by other groups like Black Lives Matters protesters, teachers and Boy Scouts.

All of this has helped Discord attract more than 300 million registered users, up from 250 million a year ago and quadruple the figure from 2018. Some 100 million people use it actively every month, a 50%-plus increase in a year, making Discord roughly a third the size of Twitter or Snapchat. Altogether the users spend 4 billion minutes each day either texting, voice chatting or video messaging via the app.

Its broader appeal has also captured the attention of venture investors. In a reversal of how things usually work in Silicon Valley, Index Ventures Danny Rimer, whose firm had invested in Discords last fundraising in December 2018, called them in February to offer more money. In a deal not previously reported, Citron and Vishnevskiy agreed in June to take another $100 million in venture fundingat a $3.5 billion valuation, up from $2.05 billion 18 months ago.

The funding comes with the understanding that Citron and Vishnevskiy, who hold stakes in the startup worth probably more than $350 million each, will continue to broaden the apps audience and focus on growing revenue. Discord is on track to top $120 million in sales this year, Forbes estimates, up from around $70 million last year, fueled by its subscription service called Nitro, which allows users to customize their profiles and the Discord groups that they belong to.

Theyre building something of tremendous value, says Rimer. If they carry on with this trajectory, were gonna be very, very happy folks.

One thing is almost certain about the route forward. It will not go entirely according to planat least if Citron and Vishnevskiys early experience is an indicator.

Both took cracks at other things before Discord. After attending Full Sail University (the school was formerly a recording studio in Ohio before moving to Florida), Citron did a few programming stints at gaming startups before founding his first gaming social network, OpenFeint. In 2011, he sold that company to Japan-based GREE for $104 million. He spent a few months at GREE, and a friend from there introduced him to Vishnevskiy, who had gone to Cal State Northridge and bounced around the Valley as a software engineer, mostly for other mobile app startups.

They got together, in 2013, to create what they both loved: videogames. Their tablet-based Fates Forever, a three-versus-three arena game thats most generously described as a little like League of Legends, launched a year later. It never took off. Entertainment is tricky. We were close, Citron maintains. Vishnevskiy suggested they concentrate instead on the social network they already planned to build alongside the game.

A year later, Discord emerged, and quickly became a viral cult favorite among gamers. They chatted while playing via one-to-one direct messages, and joined groups, known as servers in Discord-speak, that then often split up into smaller groups or channels. Some channels were text-message based. In others, a voice chat function created a digital version of a telephone party line. There were desktop and mobile versions of Discord, and it could run within a web browser without needing to be downloaded unlike competing services. Plus, it was free and fast with little load time. By July 2017, it had 45 million registered users, adding 1.1 million new users each week.

The word horror comes to mind, says Citron. Im Jewish. My grandfather fought for America in World War II against the Nazis. It certainly weighed on me that I would be working to somehow facilitate people becoming radicalized.

Unbeknownst to Citron and Vishnevskiy, not all were the type of people theyd hoped to attract. White nationalists had swarmed onto Discord, and its there that they coordinated the Unite the Right gathering that would turn deadly in Charlottesville that August. The weekend event was thoroughly thought out, and a nine-page PDF eventually circulated on Discord: Women were told to stay off the front lines and concentrate on planning the after party. A central point was established for carpooling. And as the coup de grce, everyone was instructed to bring a Tiki torch for a Friday night vigil and memorize the lyrics to Dixie, the Confederacys de facto national anthem. They planned on singing it that evening.

The two-day rally received widespread media attention, climaxing with a 20-year-old white nationalist named James Alex Fields ploughing his car into a group of people protesting Unite the Right, killing one person. (He would later be arrested and sentenced to life in prison.) Within a few days, a New York Times story detailed the events connection to Discord, and then a Wikileaks-esque collective, Unicorn Riot, began releasing leaked logs of the white nationalists conversations on the app.

For the Discord founders, the whirlwind of those events were a painful blur. It was an emotionally intense time for us, says Vishnevskiy.

The word horror comes to mind, says Citron. Im Jewish. My grandfather fought for America in World War II against the Nazis. It certainly weighed on me that I would be working to somehow facilitate people becoming radicalized. It made me sick. I felt like I was dishonoring my familys legacy, my ancestry.

Citron and Vishnevskiy knew they had to make a fast choice about the amount of regulation to impose on their platform, a similar type of reckoning that has taken place more recently on Twitter and Facebook over President Trumps comments. Over fall 2017, they deleted roughly 100 Alt-Right groups from Discord, a first step. They promised themselves thered be more to come.

I want to make something that makes the world a better place, says Citron, evoking a familiar bit of Silicon Valley idealism. And that was a real moment where we realized that we really needed to step up our efforts to make sure that that was the case.

Since Charlottesville, Discordhas done a better job of policing itself, with 15% of its employees now part of its Trust and Safety team, a unit that didnt exist at all in 2017. (For perspective, Facebook pledged to devote a similar figureabout 20% of its employeesto similar tasks across its products but hasnt publicly stated if it has done so.) These days, users and groups are kicked off using metadata tracking rather than IP addresses, an attempt to better ensure people cant easily resurface elsewhere on Discord. Updates have made it easier for moderators within a groupwho are normal users, not company employeesto report bad behavior swiftly; mods can also add bots, pieces of automated software, to scan for offending language.

An internet meme about teachers likens those using Discord to the vivacious Miss Frizzle from the "Magic School Bus" children's book series while rival Zoom gets Ms. Fowl from "Jimmy Neutron."

Wary of another Charlottesville, the Trust and Safety team specifically researches white nationalist groups and platforms online to find any new Discord servers that emerge. As it happens, the Alt-Righthas largely migrated to Telegram, a rival messaging app that, unlike Discord, offers the complete anonymity of encrypted communication.

Still, Discord is far from squeaky clean. Its immensely easy to find offensive material even among the largest groups (and much more of it circulates in smaller, more private circles). For instance, one of the largest meme-based groups is called Gates of Autism. It has 212,431 members, and its profile picture is Pepe the Frog, a white nationalist emblem. A simple search in the chat history for the derogatory term faggot produced results that spilled over hundreds of pages. Members widely trade memes and GIFs that are either explicitly or implicitly sexual. Asked about this content, the founders declined to comment.

Nonetheless, experts on digital hate speech generally agree that Discord has worked diligently to get its act together since 2017, and it is, largely, in no worse shape than its competitors. Those same experts also agree that this is a sad comment about the internetand social media writ large. Discord has improved unambiguously, and I applaud that, says Will Partin, an analyst at Data & Society, an internet research institute. Every platform is kind of the same: Every single platform has content moderation problems.

A funny thing happened as Discord was righting its wrongs. YouTube and Instagram influencers began using the app to more extensively interact with their communities, something that even Citronand Vishnevskiy did not totally understand until they read about Discord in a March 2019 story from TheAtlantic.com. The influencers liked the app, according to the article, because they could chat directly with their fans without worrying that their messagemaybe promoting a new video or a postmight get buried by an algorithm-based feed. That made us go, Hmmmm, Citron says. We were like, Okay, theres probably something here.

Nothing makes Citron and Vishnevskiy clam up faster than a question about Nitros next features. I don't want to preannounce them. Whenever we've done that in the past, it basically means we have to ship itfastor everyone gets angry.

That story plus internal research that uncovered some unique Discord groupslike one devoted to recording an amateur hip-hop albumprompted them to do something theyd never done before: complete a massive survey of users. In 2019, they sent out a 60-minute survey containing 23 questions. The volume of responses, they say, told them they not only had a rabid fanbase. It also told them that Discorders used the app for much more than gaming and that they found the app complicated to learn.

That led the company to look for ways to broaden its appeal and to simplify its user experience. Those ideas have picked up urgency since the coronavirus ended life as the world knew it. In May, video chat within servers was rolled out, a feature originally planned to debut in the second half of the year. Discords go live feature will soon be renamed to better reflect what it is: Screen Sharea way, yes, to share your screen. Thinking ahead, Discord hopes both of these features attract users who need virtual learning tools.

The website also got a makeover, launched this week. The old illustrations of controllers and computers have been replaced with images of more general geekery: a wizard, a lady frog reading a book, a caballero who is a toadstool. There are templates now for teachers and others to quickly create Discord groups. Mentions of gaming come only after ones of pet photos and school clubs. Its cutesy new tagline: Your Place to Talk.

The revenue engine for all this is the Nitro subscription service. (Citron and Vishnevskiy refuse to sell ads or user data.) There are two Nitro versions, a classic plan for $4.99 a month, or $49.99 a year, or an upgraded one for $9.99 a month or $99.99 annually. They both give members the ability to customize their username (each handle has a four-digit number randomly appended, but pay up, and you can use choose that number), stream themselves at better qualities and bring their custom emojis across groups (usually they can only exist within one group). The more expensive Nitro subscription also lets users boost their groups. If enough Discorders pitch in and accumulate enough boosts, they can get similar customization features for their groups. More than 1 million users have subscribed to Nitro, Forbes estimates.

Nothing makes Citron and Vishnevskiy clam up faster than a question about Nitros next features. I don't want to preannounce them. Whenever we've done that in the past, it basically means we have to ship itfastor everyone gets angry, says Citron. Josh Elman, a Greylock venture partner who sits on Discords board, offers up a little more insight. This becomes a creative challenge and opportunity. I could build icebreaker features if I wanted to build a group that was a club. I could have events and calendars that could be built into that. And I'm just throwing out dummy examples, he says.

While Citron wont give specifics, he is happy to talk about the vision, speaking over a Discord video chat from his San Mateo, California home. As he and Vishnevskiy catch up over cocktailsa whiskey, neat, for him and a greyhound for Vishnevskiyhe talks about what he sees Discord becoming: something akin to the bar from Cheers, a show that he has caught a few times on Nick at Nite reruns. A place where everybody knows your name. A place that you can be with your friends, talk and share as much as you want.

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Discord Was Once The Alt-Rights Favorite Chat App. Now Its Gone Mainstream And Scored A New $3.5 Billion Valuation - Forbes