Roblox isn’t a single game, it’s a virtual environment that hosts millions of different games, enables users to build and make money from their own games, and includes social communities.
Players traverse wildly different experiences—from raising virtual pets to first-person shooters and mini golf—but maintain one personalised avatar, who can make friends, chat and interact with other players within the Roblox universe.
Most Roblox games are free—and the platform’s game development tools and publishing processes are also free— because Roblox’s growth depends on user-generated games. Some game developers charge a one-off entry fee or make money via in-game transactions or by selling items for Roblox avatars.
Payments are made using a native currency called Robux (players can buy Robux with real money) which can be cashed-out by game developers once their earnings reach a minimum threshold. The company itself generates revenue by taking a cut of these transactions, as well as advertising and licensing games/IP to other companies.
Roblox exists in the grey area between traditional gaming and the growing emergence of blockchain-enabled games and the metaverse: web3 ecosystems defined by community-driven experiences and earning power based on players’ contributions and ownership of digital assets.
“Roblox is a metaverse which has 58.8m daily users up from 19.1m daily users in 2019—two of them being my children—compared to one million daily active players in all of web3 games on the blockchain combined,” futurist and experienced metaverse advisor Katherine Boiciuc says.
Boiciuc said that while a full transition from Web2 to Web3 gaming was a way off, more immersive and collaborative gaming experiences were attracting strong funding: she points to a six-fold jump in funds raised by web3 gaming firms in India in 2022 compared to 2021, and multi-billion dollar investments by Meta and Animoca Capital.
“It’s a space that is hot and one to watch for investors,” she said.
Why Did Roblox Become So Popular?
In 2004, David Baszucki and Erik Cassel, who had previously worked together to develop educational software, launched Roblox as a hands-on way for kids to deepen their understanding of coding and game design. What began as an educational tool has evolved into a comprehensive marketplace to access and create commercially-viable games.
Roblox’s success in the gaming industry is primarily attributable to its freemium, multi-game model and the way it harnesses its community’s creativity, which have both driven incredible growth in its user base.
“Roblox is becoming popular because of its platform capability. It means anyone, anywhere in the world can be a game designer, build a business, and generate passive income,” Boiciuc argues.
“The barriers to understanding and learning code are almost gone with the advancements of technology like OpenAI’s ChatGDP. This has caused a significant increase in the volume and quality of games on the platform.”
Tapping into Roblox’s ready-made ecosystem of around 60 million active gamers is also an appealing prospect for brands. Recently, Tennis Australia used a branded Australian Open game on Roblox to reach a young potential fanbase, and engaged more than 120,000 people on the first day. This includes broadening exposure for sponsors — the game’s visuals of center court included the logos of real-life major partners.