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Originally from Hackernoon, by Amit Singh
Recently, I saw a very interesting tweet:
"In the last five years, no startup product in the U.S. has had more than 1 million monthly active users."
While the authenticity of this tweet remains to be verified, it brings me back to apps that have met that standard over the past five years. Only three came to my mind: TikTok, Fortnite, and discord, the chat app. Discord products were released in 2015 and the company was founded in 2014.
Discord is a voice and text chat app designed specifically for gamers with a valuation of $2 billion, 250 million users and 56 million monthly active users. However, most people don't know much about the app.
It wasn't until recently that I learned more about Discord. Until then, all I knew was that it was a chat app for gamers.
Similar chat apps are popping up. What makes Discord unique compared to social media such as WhatsApp, Reddit, Twitter, and more?
The answer is simple. In addition to chat apps, Discord is a discussion platform and community for gamers. But its capabilities don't stop there. Discord solves a very specific problem: players can voice talk to their teammates in the game through this app when playing online team games such as DOTA.
Keeping the communication is especially important in team games, and Discord provides this feature for online games, with Skype voice calling only available to gamers. Discord became a community of gamers.
Discord's similarity to Slack
Slack is a very similar chat app to Discord, except that the former is used by staff and the latter is designed for gamers. Not only are the two apps similar in genre, but the origin stories are strikingly similar. The founders of both companies repeated the cycle shown twice in the image below.
Slack：
1. Slack founder Stuart Butterfield is a video game enthusiast. He tried to develop an online role-playing game called Game Neverending, but unfortunately failed, so he turned to flickr, a photo-sharing site, which he later sold to Yahoo.
Subsequently, Stewart raised about $10 million for another game called "Glitch," but the game didn't work out. Stewart eventually turned to Slack.
Discord：
1. Discord founder Jason Setron is also a video game enthusiast. He also tried to create a game called Aurora Feint, but unfortunately failed, so he switched to the social platform OpenFeint, which he later sold for $100 million.
2. Subsequently, Jason raised about $10 million for another game called Fates Forever, but the game didn't work out either. Jason eventually turned to Discord.
The experiences of the two overlap very highly. Both Stewart and Jason eventually succeeded in developing multibillion-dollar chat apps, and even the experiences were exactly the same.
In this way, is it possible for everyone to start developing games? True, failure is inevitable, but after a critical turnaround, success may be at hand. After all, survivor bias is true.
The key twist: from Fate Forever to Discord
The key turning point in entrepreneurship is difficult, especially when the company is well-funded and has a large number of employees.
To build a hardcore, multiplayer iPad game, Jason raised about $10 million. After raising funds, he claimed:
"I'm confident that we'll get 100 million game users and $1 billion in revenue."
—Jason Setron on the game Fate Forever
In mid-2012, jason's team began building Fate Forever. In mid-2013, the game was put into trial operation. In mid-2014, the game was launched. In late 2014, the Jason team realized that the game had not been a success and that there were very few paying players, so they chose to take the game down.
Jason's team's research and development goals didn't naturally shift to chat apps. At the time, teams of designers and developers were working on "Skype for Gamers" and other game concepts at the same time. Two months later, they realized that the former had the most potential, so they decided to fire the designer and formally change direction.
This critical twist is interesting. The conventional wisdom is that one mind cannot be used together, and spending two months on multiple ideas is quite a long time. But the abundance of money and a sizable team allowed Jason to put into practice multiple of his ideas. In fact, he has a team for each of his projects. Slowly, he began to involve developers in Discord's projects and fired designers. It was a tough decision, but he had to.
Discord was also not proposed by Jason, but the idea of an employee on the team. He wanted to keep the idea going, and in the end, the whole team joined the project. From this point of view, hiring a strong early team may be another advantage. If you want to shift your perspective, they might bring you a billion-dollar idea.
Does a consumer app need to address a specific issue?
This brings me to another question I've always wanted to ask. What exactly does Discord do?
At first, Discord wasn't meant to emulate Slack or provide a discussion platform for gamers, it started with a very specific problem for PC multiplayers.
Most popular multiplayer games don't let players fight alone, but rather require them to form teams and compete with each other. Therefore, gamers must use voice chat software to coordinate and communicate with each other. At the time, most players used Skype, and few used teams' voice messaging tool, Teamspeak's paid service. Teamspeak is built specifically for players to communicate with each other, but the technology is slightly outdated.
Team voice is not a completely new idea. Teamspeak is powerful, and startups like Curse are trying the same. In mid-2014, Curse raised $16 million, and its voice chat app already has more than 1 million monthly active users.
Basically, Jason chose an idea that was known to work, confident that he would do better.
Original or not, Discord is still solving a very specific problem. Many consumer apps start with a very vague problem, such as connecting people with the same interests in the community and discussion platform. But if you look back at the history of most of these products, you'll find that they're struggling to solve a very specific problem that users faced at the time.
When it was created, Instagram was used to handle blurry photos taken by early iPhone cameras. Facebook can find classmates in your class and master their class schedules. Snapchat was originally a student at school and was a chat app that couldn't track chat history. The same is true of Discord, where it is necessary for players to talk to their teammates in the game.
TikTok is the only exception I can think of, it provides a platform for the majority of ordinary users to express themselves, and it has been a great success.
An earlier version of Discord
After 5 months of product work, the Jason team released the first version of Discord. The original version, though not an ace, was a mature product. Jason's team of 18 people may have been so grounded in the game studio that they didn't believe in "rapid iteration."
After the launch of Curse Voice and Teamspeak, to survive, it was necessary to hand over better works.
Image note: Screenshot of Discord in October 2015. Most of the features were built-in at the time.
It's also important to note that even though Discord's homepage and brand haven't changed much since its launch, the app has struggled to surpass Skype and TeamSpeak over the past five years. This gives the player exact information about Discord and looks superior to the other options.
While "rapid iteration" has many benefits, as Discord demonstrates, this Steve Jobs-style approach to product development also has its advantages.
In addition, Discord took five months to build the product, far more time than platforms like social news site Reddit, but still much shorter than Zoom taking two years to release its first version.
Early release channels
In the three weeks since the product was released, Discord's users have been few and far between. Discord then used Reddit as its first distribution channel, and the team began discussing Discord in the game section. Eventually, some users also began to post about the relevant information. Discord ushered in the first wave of growth.
The second wave, and probably the most influential distribution channel, is the game streaming platform Twitch. The Discord team connects the server to Twitch, allowing Twitch streamers to voice chat with fans. Chats have privacy options that allow or disallow certain users.
But that alone won't help. The team had to solve a specific problem.
Security has proven to be a big issue for streaming platforms. With millions of viewers, anyone can take them offline through a DDoS attack, and existing solutions like Skype or TeamSpeak don't offer that protection.
When it comes to security, Discord does a better job than any other company on the market, even startups including Curve Voice. A lot of Twitch influencers started using the app and recommend it to fans. Discord thus gained a free influencer marketing channel.
The move to use Twitch influencers as a distribution channel is interesting. Discord is primarily designed to help players voice chat with friends while playing the game. As a result, it needs a network of friends as strong as Facebook'. Focus on Twitter influencers pursuing fan networks such as Twitter. Use a fan-based network to acquire users, and then attract users' friends to join with the quality and utility of service.
Product metrics
Discord went from having no users for the first 3 weeks (mid-2015) to 3 million registered users within 6 months (January 2016). During this period, it grew by 133% month-on-month and added 1 million new users per month, which is a staggering number even for smaller apps, and Discord has done this on top of 3 million users, which is a staggering feat. In just one year, user registrations reached 25 million, up 70% month-on-month.
May 2015: 0
January 2016: 3 million (133% Q-O-
December 2016: 25 million (+70% m-o-q)
May 2017: 45 million (up 30% m-o-q)
May 2018: 130 million (+25% m-o-q)
May 2019: 250 million (+16% m-o-q)
Jason mentioned in an interview that first-week retention and usage frequency were two metrics he used early on to determine whether a product was working properly. While relevant publicly available data has not yet been found, the growth rate itself is a clear indication that the product is working successfully.
At the moment, Discord's retention rate is truly impressive. It has a 30-day retention rate of 27 percent in the U.S., nearly the same as WhatsApp, and relatively low retention rates in the rest of the world, between 10 and 20 percent.