Discord and Microsoft Said to Discuss Deal That Could Top $10 Billion

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The privately held company, which investors valued at $7 billion in December, is also a candidate to go public. This month, Discord hired its first chief financial officer, a sign that it may be preparing for an initial public offering.

Spokespeople for Microsoft and Discord declined to comment. VentureBeat previously reported that Discord was holding deal discussions, and Bloomberg reported Microsoft’s involvement.

Joost van Dreunen, a New York University professor who studies the business of video games, said that if a deal were to happen, Discord “would be a natural fit” with Microsoft’s Xbox video gaming business. He said Microsoft has been “building hardware, buying software, and is now stitching it all together with the connective tissue of a community layer.”

Microsoft has said it wants to make it easier for people to play games at home on its Xbox consoles, or on the go on their phones. In the last three months of 2020, its gaming business generated $5 billion in revenue for the first time, after the release of new Xbox consoles.

Discord was founded in 2015 by Jason Citron and Stan Vishnevskiy, programmers and entrepreneurs, as a platform for video game players to chat and hang out while gaming. It gained mainstream attention as a gathering ground for the far right, who used Discord to organize the white nationalist rally in Charlottesville, Va., in 2017.

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