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Core Asset Wealth Management State Discord IPO As “Next Big Thing”

January 11th, 2022 Back To News & Insights

Discord IPO As “Next Big Thing”

Discord, the communications software popular with gamers & streamers was valued at US$ 15 billion in September 2021 and is said to be considering an initial public offering (IPO) in the near future, with rumours circulating for Q2 to Q3 2022.

What is Discord?

Discord is a San Francisco-based software company that offers app-based services focused on instant messaging, video calls and text chat. The company was started in 2015 by programmer Jason Citron. Citron former owner of a gaming company became frustrated with the challenge of interacting with other gamers using existing VOIP communication software.

In response to the problem, Citron developed a chat service focused on ease of use and functionality with minimal impact on gaming performance. While several millions in initial funding were raised for the existing studio, waning prospects for the project meant the focus switched to Discord, for which Citron secured $20 million in 2016.

By this point, Discord had 2.9 million users, building to 45 million by 2017, when the company secured a subsequent fundraising round of $50 million led by Index Ventures. By the time of the next round of $150 million at the end of 2018, the company had 200 million active users.

Between 2020 and September 2021, the company would raise an additional $700 million, bringing total funding to more than $982 million, with more than 450 employees and revenues of $130 million in 2020, up from $45 million the prior year.

Discord IPO, Funding and Refusal For Acquisitioning

Among the many factors why Discord is going public, the refusal to get acquired by a larger company is the biggest one. So far, the company has turned down plenty of offers, with the most notable one from Microsoft. Earlier this year, Microsoft looked to acquire Discord for potentially $12 billion. But talks never moved past the initial stage.

The company has gone through multiple rounds of funding. Some of the more notable VCs backing Discord include Benchmark, Greenoaks Capital, Greylock, and more. This all points to Discord going public in the foreseeable future. That means a Discord IPO we can all look forward to.

Discord IPO, What Will It Be Worth?

The global gaming industry is predicted to grow at a CAGR of 9.64% up until 2026. Although North America and Europe might seem like the two regions where the industry is most popular, that simply isn’t true. The Asia Pacific is the largest gaming market, and the Middle East and Africa are the two fastest-growing markets. In Asia-Pacific, there are projections of an increased player base from 84 million to 311 million by the year 2026.

What this tells us is that the gaming industry is red hot at the moment. Since Discord establishes itself as the go-to communication platform for gamers, the company’s stock will inevitably rise once they go public. A third of Discord’s users are gamers. This means Discord’s revenue is generated from many aspects with the remaining two thirds interested in cryptocurrency, livestreaming, screen sharing and others.

As such, we believe a Discord IPO to be hands-down one of the most exciting stocks to pursue in the future.

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