[HN Gopher] Roblox raises $520M at $29.5B valuation
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Roblox raises $520M at $29.5B valuation
Author : Impossible
Score : 118 points
Date : 2021-01-07 06:27 UTC (16 hours ago)
(HTM) web link (venturebeat.com)
(TXT) w3m dump (venturebeat.com)
| ArtWomb wrote:
| Congrats Roblox! Now start paying kids to make your games, set up
| a USD/RBX free exchange, and watch that valuation skyrocket even
| further ;)
| HomeDeLaPot wrote:
| They paid community game creators over $100 million last year:
| https://corp.roblox.com/2019/08/roblox-developers-set-earn-1...
| contingencies wrote:
| https://www.crunchbase.com/organization/roblox/company_finan...
| impulser_ wrote:
| That's more than the value of Take-Two, and nearly the value of
| EA.
|
| Take-Two's Q revenue is nearly 4x Roblox.
| adamnemecek wrote:
| The big diff is that roblox is a platform and has more room to
| grow.
| tomatotomato37 wrote:
| Wait I'm confused. When did roblox turn from a janky lego clone
| from the neopets era into something worth 11 figures? Do they
| have some sort of massive international userbase or hit mobile
| app I'm not aware of? That's nearly half that of Blizzard of WoW
| fame.
| dharmab wrote:
| Roblox is an extremely robust modding platform and they allow
| modders to make money. There are entire commercial studios who
| build games withn Roblox.
| nolroz wrote:
| Over half of us kids are playing it. There are millions of user
| created games and worlds.
| beckingz wrote:
| But why?
|
| It was a fine game when I last played it 10 years. What have
| they added that make it so good?
| specialist wrote:
| My older nephew plays FortNite, the younger plays Roblox.
| Best as I can tell, they're social hubs, serving the same
| function as the MUDs my generation (dial-up BBS) played.
| The actual gaming parts are just the backdrop, like
| nightclub themes (jazz, EDM, rock).
|
| A buddy of mine cofounded FlowPlay. Surprisingly popular,
| but nothing like Roblox. Pretty much same idea. Users keep
| going back to hang out with their friends.
|
| I've read that Roblox also has a thriving eco system of
| third party developers. Something that MineCraft,
| SecondLife, and other 3D/VR MUDs/MMORPGs didn't quite
| crack.
|
| So Roblox gets that sweet flywheel effect. Like an in-game
| Steam (app) store.
|
| Since my nephews cannot and will not use lame adult phones
| or chat apps, I installed both Roblox and FortNite, their
| preferred chat clients. I've never actually played any of
| the content.
| nolroz wrote:
| I think the other comments cover it well. It's a social hub
| with a lot of freedom. You can find knockoffs of many
| mainstream games and many more creative originals. You can
| find places to build houses, run obstacle courses, role
| play jobs, play hide and seek. Lots of creativity kicking
| around. You and your friends can transverse the multiverse
| together and explore, or go off on your own. It makes me
| think of a low fi early version of the kind of world
| described in ready player one and other sci-fi novels. Just
| wish they had better support for their users getting
| hacked. I know a young lady who lost everything recently to
| a hack and can get no response from the company to help.
| softwaredoug wrote:
| It's a great question. I think probably:
|
| - it's very social and online first, kids can play with
| each other online seamlessly
|
| - it's simple. Most games you join and do silly kid stuff.
|
| - there's endless freedom to create new games and
| experiences
|
| - a strong YouTube presence with popular you tubers that
| get kids excited to try different things.
| uncledave wrote:
| No they just had a shit load of marketing and the whole social
| network effect of it caused it to escalate.
|
| It's still a janky as fuck attention grabbing upsell platform.
| Like an ultra-capitalist minecraft. My kids don't use it - they
| got bored quickly.
| softwaredoug wrote:
| Every kid I know plays Roblox. It's probably more popular then
| Minecraft in the 14 and under crowd.
| Larrikin wrote:
| Is there a good way to follow companies that have announced plans
| to IPO so that you can buy initial shares besides a Google alert?
| gamblor956 wrote:
| If you don't have a relationship with the IPO's underwriter,
| you're not buying IPO shares. You're buying shares from the
| people who bought IPO shares.
| qeternity wrote:
| This is absolutely untrue. Most legacy brokerages (Fidelity
| et al) will allow you to place orders for IPO shares. It's
| highly likely you won't get much and possibly none as the hot
| ones are often very oversubscribed, but it's very possible.
|
| Call your rep and ask.
| fossuser wrote:
| They switched to a direct listing so you can just buy on the
| opening market.
| mypalmike wrote:
| The google search term here is "IPO calendar". Each exchange
| maintains lists, so it can help to add "nasdaq" or "nyse", etc.
| pembrook wrote:
| My gut feeling after seeing this question on HN and watching
| how crazy robinhood users are getting over IPOs, makes me very
| scared for future returns.
|
| It seems we're sufficiently far enough into the future that the
| the largest cohort of investors is too young to remember the
| late 90s.
|
| And this doesn't have to end in a crash. Could just be a decade
| of lost returns going forward as we've pulled all the gains
| from the future into the present.
| [deleted]
| vasco wrote:
| Here you go: https://sec.report/Form/S-1
| shmerl wrote:
| And they still can't make it work on Linux, even in Wine.
| stretchcat wrote:
| Incidentally, minecraft runs fine on Linux.
| [deleted]
| Triv888 wrote:
| but aren't they trying to retire the java version?
| jjice wrote:
| I'm not a very regular player, but from what I understand,
| the Java version is the most popular by the "enthusiast"
| community. At least the people I know that are very into
| the game still use Java for modding purposes and more
| extensive server options (also because of mods).
| robotnikman wrote:
| Yep, if you run a Minecraft server you are most likely
| using the Java version with a wrapper such as Spigot (or
| one of its forks)
| homarp wrote:
| progress is being made though: https://github.com/roblox-linux-
| wrapper/roblox-linux-wrapper...
|
| Thanks to Proton work, VMProtect hurdle has been passed and the
| new issue is in regards to the challenge packets that the game
| sends at start.
| shmerl wrote:
| Nice. But with that kind of money they can make a proper
| Linux client already.
| [deleted]
| ausbah wrote:
| are they not profitable after 10+ years? why are they still
| raising money?
| kevindeasis wrote:
| People everywhere on the internet are going crazy about Roblox
| IPO. I initially thought about gambling a small amount of money
| with Roblox when they go public. But I start to question if it
| would be even wise for me to put money in Roblox. It just feels
| its too good to be true as everyone mentions that they're gonna
| buy the stock. What do you folks' think?
| baby wrote:
| What's the long term game here? I don't see it. On the other
| hand Minecraft keeps on giving, they're shipping on more
| platforms, they're creating swag, Other games, series, etc. I'm
| pretty sure we'll see some theme park based on Minecraft at
| some point. So here's that. Maybe roblox is on the same path.
| bemmu wrote:
| I was into Minecraft before, and now launched a somewhat
| successful game on Roblox. I don't think the games are really
| comparable at all, about the only similarity is the blocky
| look of the characters, and even that is changing soon, as
| skeletal animation was just launched.
|
| If I had to compare to something, I'd say it's like Unity,
| except with their own app store from which you can instantly
| launch games/experiences, and with cross-platform multiplayer
| taken for granted.
|
| What I love most about Roblox is how the community is leaving
| behind a lot of the old game tropes and coming up with
| completely new things, as a lot of the game makers are kids.
| Turns out most games don't have to involve shooting anything.
| sjg007 wrote:
| What's your game?
| sjg007 wrote:
| Roblox is definitely on the same path.
| djaychela wrote:
| Roblox is incredible in some ways. I have 4 step-kids, and
| during the first UK lockdown, 3 of them played regularly in
| roblox with me (I don't live with them, and didn't see them
| for 3 months).
|
| Some of the games are immense - full on theme parks, weird
| physics games, movie tie-ins, "total wipeout" physical games,
| all sorts. There was a really accurate Natural History museum
| at one point. It's so incredibly diverse, that it's hard to
| get a real handle on it unless you play it.
|
| It seems to have got real traction with some of the kids in
| terms of the effort they put into programming their games,
| and hopefully it'll be a gateway to programming for some of
| them.
|
| I think kids spend too much time playing games, but Roblox is
| pretty good, and they even make an effort to censor the chat
| - which can never be 100% but it's better than a lot of
| places.
|
| FTR I've played minecraft with them a lot too, but the issue
| is that ends up being a fighting game ones the boys' hormones
| kick in (sadly!)
| DonnyV wrote:
| Minecraft has their own characters and stories. Like other
| people have said here, Roblox is a platform to build
| characters and stories to sell.
| vidarh wrote:
| Roblox is a _platform_ and an _exchange_.
|
| While Minecraft has sort-of become a platform too, with
| people doing custom servers etc., Roblox is explicitly built
| to facilitate being a middleman skimming percentages of
| people buying and selling digital assets and game passes.
|
| The marketplace added to the Bedrock edition of Minecraft is
| a baby step in that direction, but nowhere near as flexible.
| isthisreality wrote:
| At this point, Roblox has to be a money laundering operation.
| sjg007 wrote:
| Why can't they IPO... I want in.
| navium wrote:
| Just thought of downloading the game to understand what all this
| valuation is about, but the reviews in the iOS App Store are so
| so fake, it stopped me right there from installing it.
| everybodyknows wrote:
| Fake -- or merely the usual clueless fankids?
| jackson1442 wrote:
| Reviews for this app will definitely be kinda weird... it's all
| UGC targeted at children so a lot of reviews will be written by
| children, probably about the games on there (even though there
| are technically infinitely many game possibilities- anyone can
| make one).
|
| Definitely an interesting platform, for sure.
| bufferoverflow wrote:
| And Boston Dynamics just sold for only $1B. Something is not
| right.
| Cthulhu_ wrote:
| How so? How much revenue does Boston Dynamics generate?
| keithnz wrote:
| nearly every parent I know, including myself, has sunk a bunch
| of money into "robux", none have sunk any money into boston
| dynamics robots.
| austhrow743 wrote:
| Roblox has a product that people pay for.
|
| Boston Dynamics has a handful of YouTube videos.
| marktangotango wrote:
| This is true in a very real sense, plus Boston dynamics has
| been bought and sold with some regularity, indicating there
| seems to some obstacles monetizing the tech.
| cptnapalm wrote:
| And, for me, the major impact of those YouTube videos has
| been the adorable parody of a robot and its robodog:
| https://youtu.be/y3RIHnK0_NE
| wtf_is_up wrote:
| What are BD's sales?
| timdaub wrote:
| So basically you're saying that a robotics company that
| periodically ships impressive robot demos should be worth more
| than a weird video game for kids?
|
| IMO while I tend to agree that achieving what Boston Dynamics
| did is surely the bigger engineering achievement, that doesn't
| say much in the company's position in the market.
|
| Also here's a more positive narrative: Why not celebrate that
| online kids games are now evaluated more than military
| technology!
| newswasboring wrote:
| >Why not celebrate that online kids games are now evaluated
| more than military technology!
|
| I am not sure I get your point here. First, boston dynamics
| is not only for military technology, sure its initial and I
| think a lot of current funding comes from defense stuff but
| so did the Internet and early web technology's funding. So if
| we ignore that spin, the narrative is that online kids game
| is being valued more than advances in robotics. Now that does
| not sound positive in many ways.
| ike77 wrote:
| Sometimes, when I look at my "smart" robot vacuum cleaner
| repeatedly banging his head against my table, I think that
| this poor creature would deserve some of the behavioral
| innovations that video game characters got.
| timdaub wrote:
| I think what you're neglecting here is that narratives are
| just subjective viewpoints. There's no _one_ true
| narrative.
|
| And my point with choosing a THAT narrative was to put the
| headline into a positive light: More money towards kids
| games than military tech! Hooray!
|
| Apart from that, there's of course a very logical argument
| too. Which is that a digital economy like Roblox is a
| novelty. That means it's difficult to evaluate and often
| it's evaluated by its potential.
|
| The economics for robots on the other hand are drastically
| different. They'll have to be researched, developed, built,
| and maintained. Whereas for any software: You write it once
| and copy it for "free" to as many customers as you want.
|
| Anyways, anyone is free to pick and chose their narrative
| according to their liking.
| newswasboring wrote:
| I think that is a very weird way to look at it. I think
| we are using the word narrative differently. I used it as
| the "story" which fits all known facts. Cherry picking
| facts can lead to false narratives. Now my read that
| boston dynamics is a signal to indicate robotics advances
| may be wrong, after all I know very little about the
| industry, but then my narrative is also wrong. There are
| true and false narratives.
| emteycz wrote:
| Boston Dynamics is not a proxy for advances in robotics.
| It's a company on the market, and it doesn't have much
| business. Academic research continues to be valued and thus
| funded.
| newswasboring wrote:
| >Academic research continues to be valued and thus
| funded.
|
| Is it though? Do you have a source for that? Now I
| understand its hard to actually calculate how much
| funding is going to which field, after all Robotics is an
| interdisciplinary field if there ever was one. Last year
| the AI budget in US was around 1Billion and another half
| billion or so for quantum computing. Those numbers are so
| small its astounding considering a kids game is valued at
| 29.5 billion american dollars.
|
| edit: Source for numbers
|
| https://syncedreview.com/2020/08/22/trump-slashes-
| research-f...
| bkanber wrote:
| Yes, valued... on the market... as a company... whose goal
| is to make money.
|
| Ask any IT pro if they've heard of Boston Dynamics: yes! Do
| you own any Boston Dynamics products? No.
|
| Ask a normal person if they've heard of Boston Dynamics:
| no.
|
| Ask a normal person if they've heard of Roblox: yes! Do you
| own any Roblox products? Yes! My kids love it!
|
| You can't take some highfalutin notion of 'potential
| progress in engineering' and directly translate it to
| market value. Market value comes from performance in the
| market.
| Taylor_OD wrote:
| Come up with a clear path to $ within X years and you could be
| the next buyer of Boston Dynamics too. I want the cool robot
| company to be worth more than the online game company too but
| revenue is what drives these things.
|
| I'm sure BD could make more money if they exclusively signed
| military contracts. But I'm sure that's not what a lot of
| people here would want either.
| jsnell wrote:
| The crazier comparison is to other gaming companies. $30G is
| more than the market cap of Take Two (think GTA V). It's about
| Ubisoft + Capcom + Square Enix + Sega combined.
|
| And presumably the people who just invested half a billion at
| $30G expect it to go significantly up from that after the
| company goes public.
| candiodari wrote:
| But it's pretty clear that Ubisoft + Capcom + Square Enix +
| Sega are the dinosaurs. They haven't had reasonable growth in
| sometimes decades. They have never even approached 150
| million players, never mind on a sustained monthly basis.
|
| Man that statement makes me feel old, but Sega is the
| biggest, their growth happened in the previous century,
| decades ago.
|
| Sega genesis, which I'm randomly assuming was the best
| selling product of this group of companies, got to about 30
| million players. Nowhere near 700 million revenue. To put it
| mildly, this was not something they could sustain.
|
| So I have little doubt that Roblox is indeed worth more than
| the sum of these companies. I don't like the games either,
| sort of a second life but for kindergarten, but clearly they
| are commanding more success in the market than those
| companies.
| eterm wrote:
| Do you know who Ubisoft are?
|
| They are huge, own many studios and their sales are orders
| of magnitude higher than the Genesis, which is an odd
| assumption to make.
| Aeronwen wrote:
| An Ubisoft badge is a warning label that says you should
| avoid buying this new game.
|
| They may have made decent stuff 15 years ago, but now
| they make pretty garbage.
| marcinzm wrote:
| >Nowhere near 700 million revenue.
|
| Ubisoft alone makes more than $2 billion in revenue per
| year.
|
| edit: Square-Enix is another $2.3 billion in revenue.
| Capcom is around $700 million per year. And Sega is even
| more at $3.4 billion per year.
| vallas wrote:
| Roblox is a platform, Boston Dynamics is not. Boston Dynamics
| in Roblox can exist.
| Barrin92 wrote:
| to be fair I still have no real idea what the use case for all
| of these Boston Dynamic robots is, primarily they seem to make
| funny Youtube content with them to be honest.
|
| Take the 'Spot' robot. It costs 75k and can carry 14kg of
| weight. For that cash you can hire a human who is way smarter
| and can carry much more for like, a fraction of that price.
| dd_roger wrote:
| The problem with Boston Dynamic's robots imo isn't the cost
| versus a human but the cost versus a simpler and cheaper yet
| just as capable (if not more capable) wheeled robot.
|
| I have a very hard time coming up with applications where the
| walking capability is useful. On the other hand the space
| wasted to put all this technology could be used for more
| batteries, a sturdier body to carry heaviers weights, etc.
| jsmith45 wrote:
| The advantage of legs is for use in environments set up for
| humans with working legs. Things like a normal flight of
| stairs, walking over a moderate sized gap in the floor,
| etc.
|
| Those sorts of things can be a real pain for wheeled robots
| (things like stair climbing wheel assemblies, and just
| larger wheels can overcome some of these, but have their
| own downsides), while spot has no issues handling them.
|
| If you can design the environment to fit the needs of the
| robots, then sure wheeled or even on-rails will likely be a
| better choice (less expensive, greater load, etc) But for
| retrofitting robots into existing environments without
| totally reconfiguring them legs can be rather useful.
|
| The question is are there enough such circumstances that
| Boston Dynamics can actually make reasonable amounts of
| money? I'm not sure. It is possible there are some fields
| with a lot of killer applications for such robots, but few
| spring to mind.
| gowld wrote:
| The point of BD is to build robots that can move like humans
| in conditions that would kill a human.
|
| Humans usually charge quite a lot for suicide missions.
| catmanjan wrote:
| But that human has rights and can't work 24 hours a day...
| Barrin92 wrote:
| neither can the robot, I think it lasts 90 minutes or so.
| And employers don't mind human rights if it's still cheaper
| than the machine
| candiodari wrote:
| Hiring cheap human labor in the US costs (for minimum wage)
| $36 to $40k per year.
|
| So according to [1] spot costs 1 year of a decent-wage
| employee or 2 years of a minimum wage employee. And of course
| that's disregarding that spot will happily pull nighttime
| duty, work on weekends, Christmas, and will happily walk into
| a chemical plant risking his life for you ...
|
| [1] https://beebole.com/blog/how-to-calculate-the-real-cost-
| of-a...
| throwmemoney wrote:
| It is more to do with volumes of product, hardware is costly
| and the margins are thin if targeting less than 1000 per
| year. The problem is the product is not versatile to be
| adopted in a more general sense. The Engineering
| accomplishment of the company are great, but it does not have
| a broad enough market and hence reflected in the cost of the
| product. Similarly, you can compare that to technical books
| and why they cost so much as the expected sales volumes are
| not high enough unlike a fictional character book, prime
| example Harry Potter, it also became a big screen hit with
| fans.
| alisiddiq wrote:
| In a world where Tesla is worth over 700B, it makes sense
| bufferoverflow wrote:
| Tesla valuation makes sense to me.
|
| They control the market of expensive electric cars that sell
| like hot cakes. And they will for many years.
|
| They build robotic factories at incredible rates.
|
| They have a great solar roof business.
|
| They have a great battery business. They innovate battery
| tech.
|
| They have a truck and a semi and a model Y coming out.
|
| And they promised a cheap electric car.
| Kiro wrote:
| While $29.5B is a crazy valuation we should not underestimate
| the powerhouse that Roblox is. It's not just some random
| overhyped fad. It's dominating the younger demographics right
| now with no signs of stopping.
| catmanjan wrote:
| I think younger demographics are an overhyped fad, tech
| companies are just becoming long arms of the financial sector
| [deleted]
| newswasboring wrote:
| > long arms of the financial sector
|
| Not familiar with this phrasing. I tried to google it but
| didn't turn up something I could understand. Care to
| explain?
| [deleted]
| the-dude wrote:
| Maybe he is hinting at TINA ( There Is No Alternative ).
| kelchqvjpnfasjl wrote:
| Roblox was released like 15 years ago. I don't think it is
| a fad. When users grow out of it there will be new young
| users to take their place.
| bluedino wrote:
| Mincraft/Mojang only sold for $2.5B if that's any help
| sjg007 wrote:
| Roblox is beating Minecraft in MAUs. Roblox is also a
| platform.
| onion2k wrote:
| Roblox has more than 150 million monthly active users, and many
| of them actually spend money on the platform. Boston Dynamics
| has some very impressive tech demos. I know which I think
| should be worth more.
| philliphaydon wrote:
| If they have 150m active users of which many spend money...
| why do they need to raise money?
| pxue wrote:
| S1 shows China ambitions. Need capital to break into a
| complete new market.
| blowfish721 wrote:
| My thought exactly. If they can't make enough money on
| their own with that many users then how can they be valued
| so high.
| casi wrote:
| The universe isnt going to turn itself into paperclips.
| scotty79 wrote:
| Because you might prefer to do some things that cost more
| money rather sooner than later?
| scsilver wrote:
| They are pushing to capture older users and create a market
| place of grittier games to help monatize the mostly younger
| player base.
|
| They are also pushing to internationalize the product.
| anonytrary wrote:
| If you can do X, then you will imagine X + 1.
| onion2k wrote:
| Same reason as any other company needs to raise money - to
| grow faster than their cashflow will allow. A business
| having healthy revenue, or even healthy profit, doesn't
| mean they can afford to achieve their ambitions right now.
| Raising enables them to do more.
|
| The fact a business is raising money is rarely a sign that
| they actually need money; companies raise because they want
| money to do something. Heck, if your company genuinely
| _needs_ money raising is much harder because there 's a
| real risk of the business failing.
| jiveturkey wrote:
| Companies at late stage also need to raise money to
| establish valuation. That doesn't seem to be the case
| here though.
| MichaelZuo wrote:
| If late stage implies that the founders have already been
| diluted significantly, why would they would want to be
| diluted even more? (Assuming they still believe in the
| future of the company)
| marcinzm wrote:
| Because they believe the extra money will allow them to
| increase the valuation more than it dilutes them.
| MichaelZuo wrote:
| I can't really think of one example really where that
| actually ended up in favor of the founders. Even
| Kalanick's Series D raise at Uber back in 2014 seemed a
| bit weird, and in retrospective given what happened
| since...
|
| I imagine for it to be actually net beneficial there
| would still need to be at least 5x or 10x growth
| potential and assuming it's already a unicorn that
| somehow can't finance otherwise on favorable terms...
| would imply a quite unique situation.
| martinald wrote:
| I don't disagree, but for healthy cashflow companies,
| surely debt is a better option?
| simonebrunozzi wrote:
| If you're in a tight race against other companies which
| also raise large sums of money, and in markets where
| "winner take all" effects happen; then, it might still
| make sense to raise money.
|
| Normally, though, you are probably right.
| martinald wrote:
| Yes I do agree, but surely you'd want to tap out all the
| debt first before going to equity raises. Very rarely see
| any debt raised in startups, so quite interesting
| behaviour.
| jannes wrote:
| I think it has something to do with founders being able
| to take money "off the table" when they raise a round.
| loosetypes wrote:
| On the other hand, Away luggage raised $100 million relatively
| recently.
|
| I have an Away carry-on and it's nice, but no technical wonder.
|
| Surely Roblox' platform's sophistication, reach, and financial
| potential are orders of magnitude higher than.. a suitcase.
| bufferoverflow wrote:
| Away luggage raised $100 million at $1.4B valuation. Which is
| nuts.
| mint2 wrote:
| Hardware is hard. Margins and expansion is so different.
|
| Building real things is hard and expensive. Building software,
| sure it's hard, but it's nowhere near as hard.
| lhorie wrote:
| A counter way of looking at it: kids today are the Boston
| Dynamics of tomorrow. Roblox is selling pickaxes.
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