How Does Discord Make Money?

With over 190 million active users and a valuation of $8 billion, Discord has become a popular communication platform, primarily catering to the gaming community. However, many users might wonder how such a service sustains itself and generates revenue. This article will explore the various strategies and tactics Discord uses to monetize its platform and the underlying mechanisms of how does Discord make money.

At its core, Discord is a free platform allowing users to create and join communities centered around shared interests, such as gaming, education, or hobbies. Users can engage in text chats, voice calls, and video conferences, making it an all-inclusive communication hub. While Discord’s basic functionalities remain free, the company has employed several techniques to generate revenue and monetize its vast user base.

One of the primary sources of income for Discord is its subscription services, known as Nitro. Discord Nitro offers enhanced features and perks to its subscribers, such as higher-quality audio, custom emojis, animated avatars, and increased file upload limits. These premium features appeal to power users, gaming enthusiasts, and content creators, who are willing to pay a monthly or annual fee for an enhanced Discord experience. Nitro subscribers also receive exclusive badges and a boosted server capacity to improve their community engagement.

Discord also incorporates advertising as a means to monetize its platform. While advertisements are not prevalent within user chats or community spaces, Discord does display targeted ads to its non-Nitro users. By leveraging user data and preferences, Discord curates ads that align with its users’ interests, resulting in a more personalized and engaging advertising experience. This form of advertising revenue serves as a significant contributor to Discord’s overall monetization strategy.

Discord has ventured into virtual economies by introducing the concept of “Server Boosting.” Users can boost their favorite community servers by subscribing to Discord Nitro or spending in-platform currency called “Boosts.” Server Boosting grants various benefits to the boosted servers, including improved audio quality, server customization options, and priority customer support. Users who value these perks often engage in boosting, thereby generating additional revenue for Discord.

Overview of Discord

The journey of Discord began when founders Jason Citron and Stanislav Vishnevskiy recognized the need for a reliable and user-friendly platform for gamers to connect and communicate. Since then, the company has garnered a massive user base, surpassing 140 million active monthly users as of 2021.

Discord has achieved several significant milestones along the way. In December 2016, the company launched its Nitro subscription service, offering additional features to enhance the user experience. This move not only generated a new revenue stream for the company but also helped to further solidify its position as a leading communication platform.

Another key milestone for Discord came in December 2020 when it raised $100 million in a funding round, valuing the company at $7 billion. This achievement not only highlighted investor confidence in Discord’s potential but also provided the company with the financial resources to continue scaling its operations.

When it comes to Discord’s business model and revenue streams, the company primarily relies on two key sources. The first is its Nitro subscription service, which offers users exclusive perks such as higher file upload limits, custom emojis, and enhanced video quality. The second source of revenue is advertising. Through targeted advertisements, Discord has been able to monetize its platform while ensuring the user experience remains relatively uninterrupted.

Let’s now look into the primary ways Discord makes money and the details of its revenue streams.

Discord’s Primary Revenue Streams

Discord has strategically diversified its revenue streams to ensure financial stability and sustainable growth. These primary sources of revenue include the Nitro subscription service, advertising, and server boosts.

Nitro subscription service

While Discord provides its core services for free, it also offers a premium subscription service called Nitro. This Nitro subscription not only enhances the user experience but also serves as one of the primary revenue streams for Discord.

Nitro is a premium service that users can subscribe to on a monthly or annual basis. It offers various additional features and perks, aimed at enriching the overall Discord experience. These perks include high-quality video streaming, high-resolution screen sharing, custom Discord tags, animated emotes, boosted upload limits, and more. By catering to a segment of users who are eager to enhance their Discord experience, Nitro attracts a significant number of subscribers, thereby contributing to Discord’s revenue stream.

The Nitro subscription service plays a crucial role in Discord’s overall revenue generation strategy. While Discord does generate revenue through other means, such as partnerships and collaborations, it is the Nitro subscription service that has proven to be a consistent and substantial source of income.

One key factor that contributes to Nitro’s revenue-generating potential is its pricing structure. Discord offers two tiers of Nitro subscriptions: Nitro Basic and Nitro. Nitro Basic, available at a lower price point, provides users with access to a selection of perks. The Nitro tier, on the other hand, offers a comprehensive range of features for a higher price. This tiered structure allows Discord to cater to the needs and budgets of different user segments, attracting a wider customer base and boosting overall revenue.

Another significant aspect of Nitro’s revenue contribution is its appeal to the gaming community. Discord has become an essential communication platform for gamers, providing voice chat and seamless collaboration during gameplay. The Nitro subscription service leverages this existing user base of gamers by offering additional perks curated specifically for their needs. This targeted approach not only boosts the number of Nitro subscribers but also creates a loyal customer base, contributing to the stability of the revenue stream.

Discord continually enhances Nitro by introducing new features and perks, periodically refreshing its offerings. This strategy not only aims to retain existing Nitro subscribers but also entices new users to subscribe. By providing an array of appealing features, Discord can maintain user engagement and encourage regular subscription renewals, thereby solidifying the revenue stream from Nitro.

Advertising

Discord offers advertisers valuable opportunities to connect with a highly engaged and niche audience, primarily composed of gamers, streamers, and community members. Through carefully integrated and non-disruptive advertising channels, Discord generates a significant portion of its revenue.

Discord offers a range of advertising options to brands, including targeted display ads, branded content partnerships, and influencer campaigns. These opportunities allow brands to reach Discord’s audience through various channels within the platform.

The revenue generated through advertising is a significant contributor to Discord’s overall revenue stream. While Discord’s exact financial figures haven’t been publicly disclosed, it is estimated that advertising contributes a substantial portion of its revenue alongside other sources like Nitro subscriptions and server boosts. Discord’s enticing advertising solutions combined with its large and engaged user base enable it to attract high-paying brand partnerships, contributing to its revenue growth.

It is important to acknowledge that Discord prioritizes a positive and enjoyable user experience. To achieve this, the platform ensures that advertisements are relevant, engaging, and non-intrusive. By carefully selecting partnerships and applying user-centric advertising practices, Discord maintains the delicate balance between generating revenue and preserving the platform’s integrity.

Server Boosts

Server Boosts empower Discord users to enhance their favorite servers and unlock exclusive perks. By purchasing Server Boosts, users can provide their favorite communities with additional advantages, such as improved audio quality, custom emojis, and priority support. These benefits make the server more enticing for both existing members and potential newcomers.

When Discord users decide to boost a server, they have several options available, including monthly subscriptions or individual boosts. Each boost adds to the server’s boost level, unlocking different perks based on the number of boosts acquired. Discord offers multiple tiers, encouraging users to purchase multiple boosts to unlock increasingly attractive benefits.

The revenue generated from Server Boosts is significant for Discord’s overall financial health. As more users engage in boosting their favorite servers, it creates a self-sustaining cycle. As servers earn more boosts, they can afford to improve their communities even further, attracting more users, who, in turn, may choose to boost. This positive feedback loop ensures a steady stream of revenue for Discord.

The Win-Win Nature of Server Boosts

Server Boosts benefit both the users and Discord. For users, boosting their favorite server allows them to personalize their experience, stand out within the community, and access exclusive features. Boosting creates a sense of ownership and pride among users, fostering loyalty and engagement.

From Discord’s standpoint, Server Boosts not only generate revenue but also foster a vibrant ecosystem. By allowing users to invest in their favorite communities, Discord creates an environment where users actively contribute to the success and growth of the platform. As more users boost servers, it increases the visibility and reputation of Discord, attracting new users to join and potentially boost servers themselves, thus perpetuating the revenue cycle.

Other Discord Sources of Income

Merchandise Sales

Discord has created an official merchandise line that caters to its vast community of users and fans. To ensure high-quality and appealing products, Discord has partnered with DOTEXE, a company known for producing unique and exclusive gaming merchandise. This partnership allows Discord to offer a diverse range of branded products that resonate with its user base.

The merchandise available for purchase includes clothing apparel, accessories, collectibles, and other branded items. Discord users can browse and purchase these products directly from Discord’s official merch website. The merchandise is designed with the distinctive Discord logo and motifs, reflecting the platform’s branding and identity.

By leveraging its strong brand recognition and loyal user base, Discord has successfully created a market for its merchandise. The appeal of owning Discord-branded items goes beyond simply supporting the company; it is also a way for users to proudly display their affiliation with the platform and its community. 

Merchandise sales provide a supplementary revenue stream for Discord, allowing them to diversify their sources of income. The availability of merchandise also offers an additional way for Discord to engage with its community and foster brand loyalty.

Discord’s partnership with DOTEXE ensures that the merchandise is of high quality and meets the expectations of its users. This commitment to quality not only enhances the overall customer experience but also encourages repeat purchases and positive word-of-mouth recommendations.

To promote and market their merchandise, Discord utilizes various channels. They often showcase new products and limited-edition releases through their official website, social media accounts, and newsletters.

Discord’s Financial Performance

Discord has not only become a hub for gamers, communities, and businesses but also a lucrative venture in the digital space.

To understand the platform’s financial success, it is crucial to delve into its financial performance over the years. This, however, will look into the company’s finances since all its data isn’t publicly available. This analysis will provide valuable insight into how Discord makes money and its ability to capitalize on its impressive user base.

Discord’s Annual Revenue and Profit

A key aspect of understanding how Discord makes money lies in analyzing its annual revenue and profit figures. By examining this data, we can gain valuable insights into the platform’s financial performance and its ability to generate income.

One significant source of Discord’s revenue is through Nitro sales. Let’s take a closer look at Discord’s revenue from Nitro sales over the past few years:

• In 2019, Discord earned $70 million from Nitro sales.
• This figure increased significantly in 2020, reaching $120 million.
• Discord’s revenue from Nitro sales continued to rise in 2021, reaching $173 million.
• The figures from 2022 and 2023 indicate further growth, with revenues of $208 million and $207 million, respectively.

Although Nitro sales contribute significantly to Discord’s revenue, its average revenue per user (ARPU) remains comparatively lower than other platforms. As of 2021, Discord’s ARPU was approximately $1.30. This suggests that the company may be prioritizing user growth and engagement over maximizing immediate revenue from each individual user.

Considering the platform’s immense popularity and widespread adoption, it’s intriguing to examine Discord’s yearly valuations. These valuations indicate the market’s perception of the company’s overall worth. Let’s look into Discord’s yearly valuations:

• In 2019, Discord was valued at $2.5 billion.
• Discord’s valuation surged to $7.3 billion in 2020.
• The platform’s worth experienced a remarkable jump in 2021, reaching $14.7 billion.
• The valuations for 2022 and 2023 show a slight decline, with valuations of $10 billion and $8 billion, respectively.

Discord’s financial performance has been characterized by notable revenue growth driven by Nitro sales and impressive valuations. Despite a relatively low ARPU, Discord’s strategic focus on cultivating a robust user base positions the platform well for sustained success in the long run.

Discord’s Customer Base and Target Market

Discord’s customer base comprises individuals from all walks of life, predominantly within the age range of 25 to 34. According to Statista, this age group represents the highest percentage of Discord global visitors by age in 2024, accounting for more than 53.4% of its user base. However, there is also a significant presence of users outside this age bracket, including younger and older individuals.

These demographics can be primarily found on the platform: 

1. Age: Discord’s customer base spans various age groups, primarily targeting millennials and Generation Z. While initially popular among gamers, its versatility has attracted users of all ages who appreciate its social connectivity features.

2. Interests: Discord appeals to a wide range of interests. Gamers, content creators, community groups, professional communities, and hobbyist groups find value in the platform’s interactive and collaborative features.

3. Geographical Distribution: Discord boasts a global presence, with a significant user base in North America, Europe, and Asia. It continues to expand internationally, attracting users from diverse cultural backgrounds.

Key Discord market segments and target audiences include the following:

1. Gamers: Initially designed for gamers, Discord’s core market segment comprises gamers of all levels, from casual to professional and competitive gaming communities. Its real-time voice chat, screen sharing, and text messaging capabilities provide an unparalleled communication experience for gamers.

2. Content Creators: Discord has become a popular community-building platform for content creators such as YouTubers, streamers, podcasters, and influencers. These individuals leverage Discord’s customizable servers and moderation tools to engage with their communities and foster deeper connections with their fans.

3. Professional and Hobbyist Communities: Discord caters to various professional and hobbyist communities, including developers, artists, writers, musicians, and more. These communities use Discord to collaborate, share knowledge, and network with like-minded individuals.

4. Social Groups: Discord also serves as a digital social platform for friends and acquaintances. It allows individuals to create private or public servers, stay connected, and engage in various activities such as voice chats, video calls, and message exchanges.

Discord’s Challenges and Opportunities

Discord’s success as a communication platform for gamers and online communities has allowed it to establish a significant presence in the market. However, it faces several challenges along with numerous growth opportunities. 

Dicord’s Market Challenges

1. Competition in the Communication Market: One of the significant challenges Discord faces is intense competition in the communication market. Platforms such as Slack, Microsoft Teams, and even social media apps like Facebook and WhatsApp offer comparable communication features. These competitors have the resources and user bases to attract potential Discord users.

2. Monetization without Disrupting User Experience: As a free-to-use platform, Discord relies heavily on finding ways to monetize its services without sacrificing the user experience. Introducing revenue streams that resonate with the gaming and online community culture while maintaining a balance between free and premium features is a challenge Discord needs to address.

3. Adapting to Evolving User Needs: Discord emerged as a platform primarily for gamers, but its user base has expanded beyond that niche. Discord needs to continually adapt its features and offerings to cater to a broader range of communities, including professional groups, educational institutions, and hobby-based communities. Failure to do so might result in a loss of potential users and revenue.

4. Maintaining Safe and Positive Communities: Discord’s open platform presents challenges in moderating content and ensuring the safety and well-being of its users. Discord needs to invest in robust moderation tools and practices to effectively deal with issues like harassment, spam, and extremist content. Failure to address these concerns might lead to negative press and a decline in user trust.

Discord’s Growth Opportunities

1. Expanding into New Markets: While Discord initially focused on the gaming community, it has the potential to expand into new markets such as professional collaborations, education, and hobby-based communities. By enhancing its features to cater to these markets and addressing specific needs, Discord can tap into new user bases and revenue streams.

2. Introducing Premium Features: To generate revenue, Discord can offer premium features to its users. Building on its success with Discord Nitro, a premium subscription that provides additional perks like custom emojis and enhanced file sharing, and server boosts, Discord can continue to expand its premium offerings. With a strong user base and an extensive ecosystem, Discord has the potential to introduce advanced features targeted at specific user groups.

3. Partnering with Game Developers and Publishers: Discord can forge partnerships with game developers and publishers to offer exclusive content, early access to games, or enhanced gaming experiences on its platform. By collaborating with the gaming industry, Discord can strengthen its ties with its core user base and attract more gamers to the platform.

4. Geographic Expansion: Discord’s growth opportunities extend beyond its current user base. By expanding its presence globally and targeting international markets, Discord can tap into new audiences and revenue streams. Localizing the platform for different languages and cultures will be crucial to successfully establishing a strong foothold in international markets.

Conclusion

Discord’s revenue-generating techniques revolve around its ability to strike a balance between offering a valuable, customizable, and user-friendly experience for free users, while simultaneously providing premium services through Nitro subscriptions server boosts, and advertising.

Through these strategies, Discord has established itself as a reliable, successful, and sustainable business, affirming the effectiveness of its approach in attracting users and generating revenue.

As the future unfolds, it will be captivating to observe how Discord adapts and innovates in response to the evolving requirements of its users. How Discord makes money has the potential to undergo significant changes, transforming the financial landscape of the platform in the years ahead.