Caroline Hyde and Bailey Lipschultz
(Bloomberg) — Discord Inc. filed confidentially for an initial public offering, according to people familiar with the matter, adding to a rapidly growing pipeline of venture capital-backed tech listings.
The San Francisco-based chat app company is working with Goldman Sachs Group Inc. and JPMorgan Chase & Co. on a listing, people familiar with the plans said in March. Discord, whose platform is popular with gamers and programmers, has more than 200 million monthly users, according to a statement in December.
Deliberations are ongoing and the company could decide not to proceed with a listing, the people said, asking not to be identified as the information isn’t public. Representatives for Goldman Sachs and JPMorgan declined to comment.
A spokesperson for Discord said the company’s focus remains on delivering the best possible experience for users and building a strong, sustainable business, and declined to comment further.
The IPO would join a slate of potential tech company listings as the US market for first-time share sales gains momentum. Tech IPOs on US exchanges raised $15.6 billion last year, more than twice as much as in 2024, data compiled by Bloomberg show. Companies on file with the US Securities and Exchange Commission for possible IPOs include AI-enabled fleet management software firm Motive Technologies Inc. and Asia-based travel app maker Klook Technology Ltd.
Founded in 2015, Discord offers voice, video and text chatting capabilities. Its basic platform is free to use, while its paid Nitro subscription product allows enhanced streaming and customization. Though it was built with gamers in mind, users have created servers focused on topics as diverse as beatboxing, investing and community radio.
The company was valued at about $15 billion in a 2021 funding round led by Dragoneer Investment Group, a Discord spokesperson said at the time. The chat platform rejected a $12 billion takeover proposal earlier that year from Microsoft Corp., Bloomberg News reported.
“The valuation last disclosed is certainly lofty,” said Eric Bellomo, an analyst at PitchBook. “It won’t catch that in the public markets.” Compared with multiples for peers such as social media firms Reddit Inc. and Snap Inc. and platforms such as AppLovin Corp. and Unity Software Inc. on the tech side, the previous valuation figure would still price Discord at a premium, he said.
Secondary markets such as Caplight Technologies and Forge Global Holdings Inc. have implied a valuation between $7 billion and $8 billion based on recent trades, according to data compiled by Bloomberg. However, trades on secondary platforms may indicate a different price than a company might achieve in an IPO given private markets’ relative illiquidity.
“Public markets will probably be a bit tougher there,” Bellomo said. He’d expect an IPO would bring more scrutiny, and that a $5 billion to $6 billion valuation range is a rough estimate.
Humam Sakhnini, the former vice chairman of game company Activision Blizzard, joined Discord in April as chief executive officer, taking over from co-founder Jason Citron, who remains on the board.
Discord has come under pressure from state governments over its safeguards around child safety. Its safety initiatives, which about 15% of its staff work on, include using machine learning to identify and remove offending content and equipping community moderators to uphold its policies, its website shows.
–With assistance from Cecilia D’Anastasio.