Roblox CEO David Baszucki on Bloomberg Studio 1.0
So in real life you're the CEO of Roblox. But on Roblox you're Builderman. You know that name. We just thought it up when is maybe two weeks after we launched and we are all picking our own user names and everyone picked one. I just a man. So you've had the same avatar since 2004. That's right. That's awesome. Do you still play. I do. I wish you could play the whole day. I have to be a CEO. So how often do you play. I'm probably on every day but not as much as I would like. I have four kids. I have a nine year old son who's on Roblox a lot. He said his favorite games are the tycoon games. Oh lumber tycoon theme park tycoon. I love
those. I love all of those. I have a bit of a theory. I have four kids. Yeah. They're now in they've grown up watching me do this yet another. They're pretty savvy social media people. But I'm optimistic someday they're going to be using Roblox or some other reason like communicating or more working or something like that. And then they're going to go oh gosh I like you forced by to be on Roblox. It's a portmanteau of robots and blocks where users can build and play games in a 3D world. Roblox has boomed into a
global online gaming juggernaut that kids are obsessed with to the tune of 10 billion plus hours a quarter. In fact Roblox was building the metaverse long before Mark Zuckerberg claimed a new name for Facebook. But what does the future metaverse really look like. And how do we cultivate a civil digital society within it that keeps kids safe. Joining me now on this edition of Bloomberg Studio 1.0 Roblox CEO and co-founder David Baszucki.
David so great to have you here. I really appreciate it. It's wonderful to be with you. Well I'm a parent I'm a mom and so I'm really excited to have this conversation for parents and anyone out there who still doesn't quite understand. What exactly are kids doing on Roblox. Yeah kids on Roblox aren't just playing. They're learning. They're hanging out together when they can't be together in real life. They're hanging out on Roblox. They could be playing hide and go seek. They could be pretending they're running a store or a pizza parlor. They could be making the next big game or adventure. So it's really a wide range of things and it involves doing things together pretending you're together. So right now it's mostly games or experiences for kids by kids. How old are these
players. How old are these developers. We have young players who are getting interested in coding who are getting interested in designing things. But more and more the community on Roblox has blossomed into this super rich ecosystem. Thousands of developers making a living on the platform. Some of these developers are making tens or twenties or 50 millions of dollars a year. So how many of these developers are really kids and how many of
these developers are now grownups. Yeah well I think two million plus developers. A lot of them are grown ups and more and more in addition to the natural organic people that started on Roblox. We're starting up studios come in on the platform as well. Professional game developers who are developing on other platforms starting to take a look at it. So our developer demo naturally leans a little bit older although we've had kids as
young as 13. Is there something about preserving the ability for young kids to be able to make games for other kids. I mean because obviously if you have you know fancy studios muscling in. Does that change the dynamic of the play. I think it does. One of my favorite experiences is natural disasters that's been on the platform forever by one of our early developers. It's not the kind of thing that I think a normal studio would ever think
of. But when developed by young creator you know we're gonna be we're gonna be hanging out together and there's gonna be a hurricane and we've got to like run away from it. There's going to be a lightning storm like that kind of stuff. We see a lot of that creative gameplay coming from the younger developers. What were you into as a kid. Were you a gamer. I was kind of a nerd when I was a kid. I was studied really hard. I luckily grew up in Eden Prairie Minnesota. At the time.
It was out in the boonies from Minneapolis Minnesota. There were sand pits. And so we did a lot of model rockets and we build go carts. And you know it's kind of one of these ideal childhoods. The one key thing that happened to me very early on as we had a computer lab in the school and then my parents bought me an apple too at the time and that kind of got me interested in this. I also heard you were the captain of your high school TV quiz team. Yeah. So think of think of Minnesota in the nineteen seventies and eighties where every weekend two different schools compete for students at each school. You know in a really funny four by four configurations on a quizzical thing. So yeah. Eden Prairie had a pretty good quizzical team. You eventually made it
to Silicon Valley you went to Stanford. You started a company called Knowledge Revolution in the 80s where users could create and test physics experiments. That's right. So that's the science kit. And you coming to life. Yeah. You know went to school had a couple hard years with jobs that weren't really that exciting took a few months off and I got really excited about. There's this whole blossoming educational software marketplace that the Macintosh had just been introduced. And it was just really interesting and exciting. I did a survey of all of that and a lot of the educational software was very pre canned. So when we looked at physics it was a whole different idea.
Could we make a wide open laboratory where we could build anything any physics experiment. Bring it to life measure it see what it feels like. You sold that company made some money you became an investor and you invested in Friendster. Oh yeah. Wow. I had a friend Sara CAC dating myself a little bit but I had a Friendster account. I'm curious what you learned from the early days of social media. Yeah. So one thing I learned is it was really fun to
invest but it's not my sweet spot. Like my sweet spot is trying to build and create things I remembered. I think having account number 79 on Friendster and just seeing that wonderful thing of finding other people friend of friend playing around with that early user interface it's a little bit almost thinking of the interactive physics where we were simulating the world and then Friendster seeing how important social is. Those were a couple of the components that have come together and Roblox. So when you started Roblox and to. And for what was the idea. Back then the feeling of this new category for me started feeling almost inexorable. It's a category that people have been talking about in sci fi for many many years. We've seen futurists talk about it. We've seen a lot of movies. We were thinking yes immersive 3D co experience. Kids flocked to
Roblox during a pandemic. He went public in the middle of the pandemic 20 21. Forty five dollars billion market cap. We spoke on that day. Even you have said that kind of growth won't keep up. What kind of growth can we expect from Roblox? In normal times we believe ever is going to be a part of all of our lives. It's going to be the way we communicate how people get to
go to school when they can't get into school how people are going to go to school in Roblox. If I happen to be taking my science class and I can't get into the classroom and we're dissecting a frog we'll probably dissect a frog in something like Roblox and a simulation which I think is going to be very very powerful. And for our company where there's a lot of people that are going to end up working all around the world. Some of us will be in the office. Some won't. Having a common 3D place where we can have those water cooler conversations where everyone has a desk. But we get that serendipitous thing where we both happened to go over and chat. I think also is going to be very big. Your goal is to build an entirely new category of human co experience. How do you moderate that on such a massive scale.
Everybody is talking about the metaphors as something that's going to happen in the future. But there is an argument to be made that Roblox has already built a metaverse. What do you think. I think we've started. And it goes back to how exciting it is to have a company in this space that I think is ultimately got so many years of growth to it. And as a new category following other types of technologies there's still so much innovation to be done and there's so much invention to be done in this category that it's mind boggling. The critics think that metaverse the term is just marketing. How do you respond to that. This type of technology is much more difficult than the net or the web which was another huge thing that we saw
predicted and has started to come. But what I think we're seeing early signs of when Mark Zuckerberg announced his plan to own the metaverse and change Facebook name to Metta as if it was something new to that kind of bother you. No of course not. It's really hard to predict in five to 10 or 20 years. Where do the companies that really figure it out. And there's so many elements of innovation that are needed. Having a UGC community one of our strengths we think that's like a huge starting point for us. But we're early in our quest for innovation here. Real Blocks has built a huge business selling Robux. Does this evolve into a much bigger marketplace. Was this revelation that people would ultimately make a living on
platforms like this that started. This digital currency is very Roblox centric in that we're a systems company or a utility. So it has formed this robust economy. It's allowed us to keep robotic robots as free for the vast majority. What robots have a partner with some of these other companies working on the metaverse whether it is Metta or Unity or Epic or Microsoft. The core technology of how are we going to ultimately support 50000 people in real time on a phone going to a concert together and waving at your friends. I think that's gonna be a lot of engineering work that each company's gonna be working on and it's gonna be really hard. As far as ultimately can an avatar go from one place to another. I think they'll be lightweight ways of starting to think about that. So what role do you think Apple and Android should play in the metaphors and what their policies
need to change to really support this vision. The biggest thing we would take advantage of if it were to happen is a change in those store fees. We we stay out of it. We like Google and Apple kind of run their businesses. But when we think about more and more developers and making a living on platforms like us and having to build stuff. If those store fees were to change we would move most of that money back to our developers. Your goal is to build an entirely new category of human co experience. The next phase of human interaction. Young. How do you moderate. That on such a massive scale. Yeah. Are you doing a good enough
job in the third week when we were live. You can go. Imagine Eric and myself back in our small office. Eric and I said oh my gosh safety and civility is we're gonna have to do it. We had maybe 100 people at the time chatting on Roblox. We saw a few. Not that egregious but early signs and we just made the call. This is going to be the foundation of what we do in the early years of Roblox. As we've gotten bigger we've gotten to the point where there's thousands of moderators. Every image
that goes on our platform gets human reviewed. We filter text very stringently especially for 13 and under. Players use a lot of A.I. and AML to help do this. We're always getting better but it is a key thing for us. How optimistic are you about A.I. and tech being able to do that. I'm really actually optimistic. We would never compare to the real world because our standards are so much more stringent. But I do believe this will just keep getting better and better. And I think over time it will get to
the point where if a 6 year old is on our platform it's literally as if the parents wanted to be there with them watching everything. We'll be able to offer that type of thing. Now a lot of parents are terrified. They're terrified of a future metaverse. They don't understand the parental controls. Do you understand that feeling. We do. We actually have to. I think it creates a higher standard for us because I think we can't assume every parent is going to get that involved with their kids. There have been some serious content challenges. You know stories about Roblox being a playground for virtual fascists. There was just this story about Kim Carr Ashton's own child seeing an ad for a game that claimed to have a sex tape of her. You know what happened there. That was very unfortunate. There was a text blurb about very shortly that very very few people saw.
We took the place down. We moderated that user and there off our platform. It was not the video was never on our platform. There was no imagery on our platform. It was a very short mention but very unfortunate. And well you know our vision is to be the most civil place for everyone. I asked and our private CEO of Alphabet and Google this question about kids and tech habits and screen time. And he said it's something that even stresses him out. You know this is the guy who runs one of the most powerful technology companies in the world. I have four kids. You have four kids.
Did it stress you out. Like how did Joel Weber with your kids. I think it highlights how much it's the responsibility of both platforms like us as well as parents. You know we're all trying to figure this. I think the one thing that we're very encouraged is that the time spent on Roblox tends to be more like hanging out together. We're being on the phone together or doing stuff together. And a lot less of it is isolated either consuming content by
myself or grinding away at something by myself. So we do like the fact that most of this is either social or involved in creation. What about entertainment. Would Roblox ever make a Netflix show? You've been investing in high fidelity graphics. What is the end game here for you. No more human. More realistic avatars. A look way out like a science fiction writer and talk about it and what I'm talking about now. Super difficult. The end game. Sometimes we talk about we would go together to a rock concert or whatever concert you like. We would be there with fifty thousand other
people. It would feel like a movie. It would feel like real life. So are you pushing towards something like Metal Horizon Worlds. Is does that sound you know more experiences like that for adult. We sometimes think of Roblox ultimately as fading into the background as a utility like the electric grid. Even those photorealistic and there's all these awesome avatars and connection and identity around the world. The things we start seeing built on this are a wide range of things. So you imagine
this not just for kids but for everyone. Absolutely. What about entertainment. Would Roblox ever make a Netflix show. We would love it if one of our developers made a Netflix show. So we would. We would feel much more authentic if one of the creators on Roblox is coming up with avatars and stories and ideas and characters like that. We want them to be in the limelight. Roblox shares took a dive on the back of Netflix results which obviously plummeted. Our investors reading too much into the connection there. I think our company is somewhat unique and what is very exciting to go to work and be the CEO is being in a market like this you know where we think ultimately billions of people are going to use this type of technology. And the other exciting thing about this market. There are so many big inventions that still have to happen. It
feels like we're pretty mature. But inside our company we realize like there's six or seven big inventions we need to make to get to that next step. Would Roblox ever consider more in-game advertising. Yeah there's a funny trivia note I would share to all the Roblox fans out there. There was a time the very first way we monetize was advertising and then there was also a time when we had pre rolled video on Roblox. That's all gone now. It's gone for a couple of reasons. We didn't want
it to interfere with the user experience. And also our virtual economy has become such a powerful way to power this that we are able to take that down in the future. I think there's a certain type of advertising that is kids safe that is immersive that doesn't get in your way. And how do you make sure that doesn't take away from the ethos of what makes Roblox. Yeah I think are the people on Roblox you know they're there to authentically connect with their friends. And as long as what we're doing with these brands is very clear non deceptive appropriate for those ages I think they'll figure out the balance of how much time do we go into a store versus how much time do we go to a crazy adventure tycoon and build an amusement park together. So either way this could be a huge new revenue stream. I believe it's an awesomely huge revenue stream. And at
the same time we've been very gentle towards it. So as you look ahead what do you think are the biggest challenges Roblox we'll face if our vision plays out which we hope it does and we have people of all ages on the platform and we're around the world. I think maintaining that civility as we grow as we have older people who might want to do go to a political rally thinking ways to do that in a systemic way. That's a big challenge. It takes a lot of thought I think thinking through the technology. I really like we're very technology driven company so it's fun to be running a company where we have to do
these seven big inventions. And you know what we're doing right now isn't going to cut it. So knowing that technology challenge is super interesting. We do a little rapid fire section Jihye Lee. It gets us to try out ideas as I can. First question what's your morning routine. Wake up go outside on my porch do a cross fit workout take a shower go to work. Where are you most productive. Home or office. Both different types of productivity homes and state flow. State at time
office. Connecting. Being together. Brainstorming. What's your favorite show right now. What do you bingeing. Oh my gosh. If you look at my YouTube history it's this weird and mechanical stuff off road vehicles and rockets and ships and big waves. Best life hack. I think it all gets down to the joy of health. Really. Like if if I'm not feeling centered but sleep exercise diet all of that everything else just completely falls. You used to have a talk radio show. Yeah. Now that I've met you in person I I get this. No I see how you'd be cool if you didn't want to listen to. Yeah. What was your style. Like I said my GM was I would say starting in college when I would have insomnia at 2:00 a.m. I would turn on talk radio and you know all those famous
KOGO people Bill Wattenberg Ray Taliaferro all just listened to the people calling in. So I after Knowledge Revolution was acquired and I had a year I had a little time to dabble. My GM was really trying to talk about outrageous topics you know gambling other controversial things. It was in a small market in Santa Cruz. I would typically it's really hard to get people to call in. It's like my whole life. So it's really scary if you're a deejay. No one's calling you inside. I made it really
controversial. I had people come on and debate interesting topics. If you could have dinner with Steve Jobs or Walt Disney who would you pick. Both. You could pick both. I guess I would have to slightly lean Disney just because he was not just the usher of the innovation but actually was kind of part of the some of the innovation. But I think Steve leaned much more on
finding the people to drive that innovation. The best advice for your 20s. Don't freak out if between the age of twenty two and twenty five everything is a disaster. Best advice for your 40s. Life is short. It's such a valuable commodity every day. What you do your friends your time your family's so important. So how do you define work life integration. I don't like the right balance. Yeah I would say can I make my Roblox job better than anything else I would do. Like can it be better than retiring. Can it be better than a hobby. Can I figure out what my unique
job as a CEO is. Every CEO job is different. Like I like doing it. So can I figure out what my role is. You mentioned your co-founder Erik Castle. Yeah. Earlier who died tragically of cancer in 2013. If he was here today what do you think he would think of the Roblox that Roblox has become. Well I think he'd be proud. It's a good question. Yeah like I think he would. You know his both of his sons have worked at the company a bit. So yeah I think he'd be very it seems like you miss him. He's just such a brilliant partner. Yeah. And he also set the standard for taking
the long view on how we engineer things. A lot of the technology at robots is still like his vision lives on and it goes back to your advice for your 40s. Life is short. It is. So in five years will the metaverse exist in in the form that you imagine. Or is it take does it is going to take much longer. Like what's the time horizon. Well it's really interesting right because we're
right in the middle of it right now in a sense with 50 million people every day on our platform it's already here. And at the same time what is ultimately going to be possible could be 5 10 or 20 years out. So it's it's all the metaverse really has existence since online dial up muds really to these very simple texts. You could call that the metaverse existed in multiplayer
gaming. World of Warcraft exists to exist now with more people and in 10 or 20 years it'll exist. Photo realistically with fifty thousand people. You clearly have so much passion for this job is Roblox. Your final stop on your journey was definitely my finals but I think there's a lot of time ahead of me here. David Baszucki, CEO of Roblox. Thank you so much.