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Letter #118: David Baszucki (2020)
Founder, President, and CEO of Roblox | S-1 Shareholder Letter
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Today’s letter is the Roblox S-1 Shareholder Letter by Founder, President, and CEO David Baszucki. In this letter, David reflects on the 15 years leading up to Roblox’s IPO, starting with it’s first launch from a small office to Menlo Park. The team would code during the day and cultivate the community during the late afternoon, which helped them develop a relationship with developers that showed them the power of user-generated content. He touches on the team’s early vision that they built towards, “a single platform, single name, single focus company that would someday support billions of users,” and explores the fundamental part of being human that is connecting, sharing, and doing things together. David then dives into the role technology has played in enhancing the sharing of stories and creation of experiences. He then brings things full circle by returning to the original vision of connecting the world and their stewardship of that vision.
David Baszucki is the Founder, President, and CEO of Roblox. He started the company in 2004 alongside his former coworker Erik Cassel with a beta version of the game titled DynaBlocks. They changed the name to Roblox (for “Robots” and Blocks”) a year later, in 2005, and officially launched in 2006. Today, Roblox is a $15bn+ company.
While Roblox was first programmed in 2004, its story really begins 15 years prior, in 1989, when David and Erik programmed a 2D simulated physics lab called Interactive Physics, which would go on to influence their approach to building the groundwork for Roblox. It was the first fully animated physics lab on a computer, and students could do almost anything. They could do anything from taking ropes, pulleys, balls, and other items to simulate simple experiments to exploring how two cars might crash or how they might build destructible houses. Interactive Physics was ultimately acquired by MSC Software for $20mn.
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As I sit here writing this letter, I can’t help but reflect on the last 15 years and how they have gone by so quickly. It seems like only yesterday when Erik Cassel and I launched the first version of Roblox from a small office in Menlo Park. From the start, we imagined the possibilities of bringing people together through play. Our goal was to create an online community where people could do things together in virtual worlds. We hoped that by sharing experiences, our users would connect, learn, and have fun with one another.
We knew almost everyone in the Roblox community during those first few months. We would write code throughout the day, and in the late afternoon socialize with our user base. We forged a tight connection with our early community of several hundred people, of which only twenty or so were online at any time. When we released Roblox Studio, we experienced firsthand the power of user-generated content. During the weeks that followed, Erik and I (and early employees John Shedletsky and Matt Dusek) were amazed by the creativity of our first developers. We quickly realized what they were building was much more interesting and engaging than anything we could ever make.
Surprisingly (or not?), things feel similar now to when we started. Today, Roblox provides shared online experiences where people can interact in 3D simulated virtual environments, sometimes referred to as a metaverse. And our original vision to make Roblox a platform for shared experiences is now leading the way for a new category we call human co-experience. Our vision for the future of our platform has never been more real and attainable.
We built Roblox from the start as a single platform, single name, single focus company that would someday support billions of users. The ultimate “product specification” was always to model reality, based on the belief that the more accurately we could simulate the real world, the more utility we could provide. Looking forward, we intend to maintain this focus as a single platform company, even as we expand the ways in which we enable people around the world to play, learn, and work together.
A fundamental part of being human is connecting, sharing, and doing things together with others. There have been countless advancements in technology that have helped humans communicate as well as share stories across space and time. Communication probably started with sound (drums) and then progressed to mail, the telegraph, radio, the telephone, and video communication. Storytelling evolved from cave art to songs, the written word, photography, silent movies, and today’s 3D movies.
Technology has enhanced the ways we communicate and share stories, but historically it has been difficult to support “doing things together” at a distance. Thanks to several recent technological developments, we are beginning to see a convergence of communication and storytelling that is enabling co-experience, starting with multiplayer gaming over the internet. On Roblox, we expect people to engage in a vast range of activities, such as visiting ancient Rome, going to an awesome concert, or dissecting a simulated frog with others in an online classroom. We continue to take long-term bets with innovative engineering to improve the realism, fidelity, and intensity of how we interact online.
We recognized early on that building a safe and civil community was just as essential to our vision of connecting the world as were the engineering challenges we faced. One of our core values is “respect the community,” and this continually guides our approach to the trust we build into our platform. This is our most important priority, and it is why we have a stringent safety system we constantly improve and evolve. In our vision, metaverse platforms will connect people from different life experiences with new and interesting ideas. We believe these connections will help build empathy by safely immersing people in different perspectives, where they will hear diverse viewpoints. And someday, as the metaverse supports a broader range of positive educational and social experiences, we hope this can expand opportunities for all people around the world.
As we’ve seen the creators on Roblox grow and evolve, we are continually amazed by their creativity. In the early days, most of our creators were users who would spend a few days at a time building something. We saw everything from outer space adventures to places where one could practice driving a railroad locomotive. Along the way, we have seen many innovations in gameplay mechanics originate on Roblox and then get adopted by other platforms.
Today, our creators range from first-time tinkerers to professional teams. We are pleased that much of the experiences they create are simply places to hang out and do things with friends, whether it is working in a restaurant or designing fashion outfits. Increasingly, our most popular experiences are social models of the real world, where one can go to high school or remodel a home. As the platform and the diversity of our users continues to expand, there will be plenty of opportunities for both hobbyists and professional studios.
In 2011, during our first Roblox convention called Roblox Rally, many Roblox players asked for our autographs. Today, players are chasing after Roblox creators for their autographs. We build the tools and platform, but our creators are the real engine for new and compelling experiences. We flex our internal creativity on technical innovation to empower our creators to build more diverse and higher-quality experiences. We ultimately hope the stories, avatars, and experiences our creators generate can become intellectual properties that will live well beyond Roblox. Our initial foray into toys and action figures, for example, is a way to bring the best of creators’ work into the real world. Someday, we hope there might be a movie based on one of the experiences (and characters) created on our platform rather than a “Roblox” movie.
When we talk about “creators” we do so in a general sense, because creating experiences on Roblox taps a broad range of skills. Our creator community includes people specialized in coding, 3D experience design, avatar and clothing design, sound design, community management, moderation, live ops, production, and business. We believe that experience creation will become a growing field of employment.
Our engine for growth is ultimately the people in the company and how we organize to drive innovation. We have learned from our creator community that a simple set of “principles” (i.e. the Roblox platform) can empower teams to innovate and execute at scale (i.e. independent, autonomous studios). The same applies to our own systems and principles for hiring and organizing within the company. We call these principles the Roblox OS. We run the company as a collection of semi-autonomous teams with the right people to drive innovation, with minimal interdependencies and aligned by our shared vision of connecting the world.
We sometimes like to say the most important thing we will ever build is the team we assemble and the systems we use to run the company. We have tried to replicate the innovation we achieved as a 20 person company at a far larger scale throughout our company. The importance of a top-notch team with aligned values remains, whether we are a team of two or thousands.
More than 15 years ago our co-founder Erik and I started with the vision of connecting the world, and today we see ourselves as stewards of this original vision. Futurists and science fiction writers have been imagining the metaverse for decades. As computing power, networking bandwidth, and human interface technologies improve, metaverses will become more and more pervasive. We feel lucky to be part of this evolution. And as we embark on our next 15 years, I look forward to the change that is inevitable as well as the things we feel will always be the same.
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