An Interview With Roblox CEO David Baszucki About Aggregating Play
Listen to this post: Good morning, This week’s Stratechery Interview is with Roblox CEO David Baszucki . I’ve interviewed Baszucki twice, in February 2022 , and November 2023 . What struck me about this interview is just how much AI has changed the landscape for Roblox. This was a company predicated on the concept that anyone can make a game, but now, for the first time, literally anyone can make a game. That means a world of abundance, and in that world, there is an opportunity to be an Aggregator, and Roblox is aggressively pursuing that opportunity. To that end, we discuss how AI has changed Baszucki’s view of what is possible, what goes into a game creation harness, making games on your phone, and the power of recommendation. Then we talk about Roblox’s vision of a universal player, where a Roblox game works everywhere, and Roblox Everywhere, where Roblox developers can use the platform beyond the Roblox app. We also touch on advertising — the natural Aggregator business model — and whether Baszucki still thinks he is building the metaverse. As a reminder, all Stratechery content, including interviews, is available as a podcast; click the link at the top of this email to add Stratechery to your podcast player. On to the Interview: This interview is lightly edited for clarity. Topics: The AI Impact | A Game Creation Harness | Roblox Build | Roblox Discovery | Universal Player | Roblox Everywhere | Advertising | Metaverses David Baszucki, welcome back to Stratechery. DB: Thank you, Ben, for having me back. It’s great to be here. So this is the third time I’ve interviewed you, and I want to sort of put that in an interesting context. First, you started Roblox in 2004, you went public in 2021, you first talked to me in 2022 and again in 2023 , that’s like a nearly 20-year stretch. Now it’s 2026, and here’s my question: Is the world more different for you now, compared to three years before, than it was for the entire first two decades from starting the company to the last time we talked? DB: The changes in the world we all feel are sure happening a lot more rapidly. When we first published Roblox — I don’t know if people on this podcast remember — software used to be distributed on floppy disks and CDs. You know, the funny thing is, you’re the second person I’ve interviewed in the last two or three weeks where we’ve referenced back to fact that the reason we say packaged software is it used to actually be packaged! DB: It’s been crazy, we had the Internet, when we started the company, we had the vision of a category called immersive co-experience, sci-fi writers have been writing about the holodeck forever, and we went along our way. I’m still pro-metaverse, we can use the word metaverse, it’s okay. DB: Okay, good, we use them all. It’s Snow Crash — metaverse, holodeck, they’re all good. We started on this vision of building human co-experience, we saw the mobile age come across us, we saw the crypto age. The AI acceleration wave we’re in is faster and bigger and crazier than anything I’ve ever seen, it’s changing how we think about the product, it’s changing how people are going to create games. What’s really exciting is, when we started the company, we had this slogan called “You Make the Game”. DB: We started with that slogan, we learned along the way that the ratio of people who might want to play games to make games has drifted — more people want to just play games than make games, because historically making games has been Roblox Studio and 3D editing and writing script. We could be approaching the time where “You Make the Game” really comes true, and where making a game is accessible to everyone. It’s really fun, I’ll tell you a bit about some of the experiments we’ve been having with Roblox Build . But we’re entering an era where making a game could be as big as playing a game. I’m right there with you. We’re obviously going to touch on all those points, I think it’s probably predictable what we want to talk about. But to go back to 2023, you called AI then, “a super paintbrush and a super 3D modeler, rather than a full replacement” — Is that still how you’re thinking about AI? DB: It’s what the data is proving out. We just had our earnings call a few weeks ago , we highlighted a lot of acceleration. One, there’s various ways humans can augment with AI on Roblox, they can use MCP , which is like plugging in a model, they can use the Roblox AI assistant to help build. And what do you mean with that MCP server? You mentioned you had 5x growth quarter-over-quarter. That’s where you’re actually using Claude Code or Codex or whatever to work with Roblox? DB: People are plugging in, we can see all of them — Claude Code, Codex, other models — all being plugged into Roblox Studio to help build things. We’ve seen two games hit the top 20 made by AI, we have other metrics like the number of assets. What do you mean by “made by AI”? Because you also said 80% of games in the top 100 have AI-contributed content. DB: Touched by AI, vibe-coded directly with AI, and we can see the count of assets accelerating. DB: It’s turned out to be, I believe, somewhat faithful to what I said. This is a human paintbrush accelerator, good ideas are still very important, novel types of gameplay are very important. But people are able to flex their creativity much more quickly. We have members of the Roblox board of directors carrying a mobile phone around, building games like 15 times a day. We have people who are not necessarily engineers or product managers now building within the company, so we’re really at the dawn of a new era. You mentioned the super paintbrush, super 3D modeler, is there a super gameplay developer? Because there’s a large step between, “I have an idea for a game”, versus the actual mechanics of the game. How much can the AI do to help you as far as that goes? DB: You’re touching on the dream of what is a game creation harness versus a coding harness . Dive into it, this is super interesting. Lay out the difference and the way you’re thinking about that. DB: So everyone’s getting familiar with coding harnesses — Claude Code, Cursor, Replit, Lovable, Codex, you name it. A game is arguably much more complicated than code. As you mentioned, there’s art, there’s 3D objects, there’s scenes, there’s avatars, there can be gameplay code, there can be missions, and there can be code underneath it. So a harness that is being created to create games really has to run in multiple modalities, needs to listen to you, and if you said, “I would like a multiplayer tortoise-and-the-hare game that 100 people can play, and we’d like to do it on Venus, and I’d like it to run on all devices” — there’s a lot of different things that need to be generated there. The avatars, the assets, all of that, as well as the gameplay, which I think is a very human thing — your idea of what type of a game it is is actually very unique. So one of our board members is building a hybrid kind of Wordle-crossword game with his own vision of how this crossword game should work, and that’s very unique to him. I’m optimistic we’re still seeing that notion of a human coupled with an accelerating paintbrush in essentially a very complex harness for building games. There’s so many pieces you talked about. The asset creation piece, compared to 2023, much further along, arguably there. You could have even the video component, or the moving worlds, but then you almost have these different pieces. Do you have to build — is there going to be one harness, and one sort of — we’re going to get to your Build app in a little bit — that handles all of that? Or are you still thinking we need to do this piece-by-piece as the model gets good enough for, or we need different models maybe for the different parts of this? DB: I think just as we see with harnesses that are routing different models, even for coding now, a lot of companies have multiple models running side-by-side and their harness is optimizing. Our harness inside Build and inside Studio Build is running not just multiple models for certain things, but then there’s a second dimension of, “Are we building a scene?”, “Are we building a 3D object?”, “Are we building code?”, “Are we building an NPC?”. So yes, we are routing both by kind of specific asset that’s being created, as well as multiple models within each of those, and we’re combining some areas where we have incredible data on Roblox — for example, data that can be used to help create non-player characters, characters that act normally, side-by-side with you. But there’s also really good coding models out there, both open source and frontier, and so we see a harness being able to put all these things together. What’s the mix of those models? Say we have three categories — frontier, off-the-shelf open-source models, and models that you’ve trained specifically. And I guess even there there’s two categories, are you doing foundational models on your own, or just doing some post-training? DB: We literally have all three of those running in our Build harness. And we’re, in certain cases, optimizing the cost of frontier with the capabilities of open source. We have a Cube model — we’ve announced it — which is trained on 3D assets. Yeah, super interesting. Tell me about the Cube model. DB: The Cube model is our own 3D asset creation model trained on all of the 3D objects inside Roblox, where the developer has opted in to the training. It’s very fast, it’s very efficient, and it runs on our own hardware. When you go into Build or I go into Build and I say, “Hey, make that tortoise-and-a-hare game”, and if you describe that tortoise as somewhat unique and different, “I want the tortoise to look like this, and have a fur that looks like this, and maybe have this”, that Cube model will and may come into play and generate that tortoise for you. How does your cost structure work for this? Is it a usage thing from a developer perspective? You have the MCP server — that’s where they can bring their own, what’s the mix? DB: You sound like a product manager, because these are exactly the same discussions I had about an hour ago. The ultimate vision is something like Roblox Build is just like the creation of short-form video. Short-form video 10 years ago — all of a sudden we all figured out we can make video and edit it on our phones, amongst multiple products that was like a huge revelation. We are so on the same page, I have a whole section on short-form video later in the interview. That’s good foreshadowing. DB: Yeah. And so along comes short-form video, and we have phones, and all of a sudden we’re making and sharing video. Arguably games are a lot more complicated, they can be immersive 3D environments, multiple people can come there. They have, as I was saying, code and geometry and avatars, but that’s where Build is going — that same notion of, “I’m going to pull out my phone and create something”, some of those models are still expensive. But the dream is, we’re already testing — I think Canada went live today. We’re testing in, I think, Serbia and New Zealand, we want it available for everyone and so it creates a wonderful opportunity for us to be super efficient with our models while super powerful. It creates the opportunity for those users who want to just do hundreds of iterations to have them buy tokens as well, if they really want to dig into it, so we’re optimistic this will be free for everyone. You keep mentioning Build, I’m on your website , and this is how you describe Build: “Build is a new way to make your own Roblox game right from your phone. Just describe the game you want in your own words, and Build’s AI creates a playable game for you in real time. You don’t need any coding or game-design experience – if you can describe it, you can build it. Want to change something? Just tell Build what to adjust, and keep going until it feels right”. Is this what you always wanted? Are we going to look back and say Roblox Studio, your pride and joy, was just a stepping stone to this? DB: This was a sci-fi fantasy when we started the company, and arguably a fantasy we never thought would come true. I would say when we started the company, we couldn’t have imagined it, and for many years, I think many people in the industry were always trying to figure out ways to make editing 3D easier, “Oh, that’s a really easy consumer 3D modeler” — even the best consumer 3D modeler is still pretty complicated. It’s unbelievable, my current 3D experience right now is, I’ve gotten very into 3D printing and I’ve never opened the associated app for it at all. It’s all done in the AI and just goes straight to the printer, it’s unbelievable. I appreciate all those people who did all the actual modeling and stuff for the last few years — I’ve skipped over all of it, but it’s the same thing in digital space. DB: I would say in the last five years we started to see that maybe AI can do this and I would say it’s been in the last two to three years where the rate of acceleration has started to surprise people and as that rate of acceleration has started to surprise people, this dream becomes much more possible. There are games on Roblox right now that are earning money that have been made with Roblox Build. We have not tens or hundreds, but thousands of games that have been published in Roblox Build. It’s not live in the U.S., we’re testing, and it will be soon, so the data is already out there. What’s so interesting is you saying, “We couldn’t have imagined it”, because one of the things in our previous interviews that came across again and again was the continuity of your vision and like, “Yeah, we saw this back then, and now we’re getting there, and we’ve had this vision all the way” — and that sort of goes back to my first question. Is there almost been a break in the last few years where even you are like, “Holy cow, I didn’t know this is where we were going”? DB: I feel like all of us in the technology industry are feeling that — everyone, CEOs, programmers, people who use these products, consumers. We’re all in the middle of it, I would say, over the last several years. Do you think this makes Roblox more or less valuable? If anyone can make a game, is Roblox Studio, your jewel, not that big of a deal anymore? DB: I think what really ends up being valuable is the combination of a few things. We’ve shared the notion of Universal Player, that I’ll dive into, the notion of Roblox Everywhere , the notion of the power of distribution platforms becoming more and more powerful when a game is created, “Where do I find it?”, “Where does it run?”, “How do we keep it safe?”, “How do I play it with my friends?”, “Is there an economy?”. So in a way, distribution platforms become more powerful. It’s worth thinking about it like — pick a distribution platform, whether it’s TikTok or YouTube, in a way, AI can accelerate those platforms, but in a way, those platforms have enormous strength with or without AI and even though someone could reproduce the whole YouTube platform with AI — the cloud, the client, all of those things — people are still going to go to YouTube to watch video. Yeah, this is the connection I was drawing — going to the short-form video platform idea. I’ve always drawn a distinction between distribution and discovery , distribution is free — anyone can post a website, at least generally speaking, they could host a game on their website, they could host a game on Vercel or wherever it might be. But then discovery is, if there’s a gazillion games, how do you find what you’re looking for? Of those two, what do you think is more important for Roblox’s future? DB: They’re both enormously important. The Roblox platform itself has well over 100 million people coming every day. On the discovery side of our platform there’s two angles to it, the first is, what happens when everyone’s building a game? All of a sudden, in the old days, there’s an abundance of new games and experiences. How do we connect the right person with the right game with their friends? Even in what might be called AI slop, there can be amazing games embedded in that AI slop, even if it’s 1 in 100 and even when games are crafted by hand, there can be some of those games that just aren’t interesting to people, so discovery becomes enormously important. What we have going on — and with the opportunity going on at Roblox — is that in addition to traditional discovery, which is optimizing every user-game pair and predicting long-term retention from that connection, with more and more games, content understanding becomes incredibly important and because Roblox is a platform where all of the games are running in the cloud, we can examine the content, learn from what we’ve learned, and maybe say, “This game has an interesting, new, diverse way it’s been constructed, this game looks a lot different than other games”, and that can help surface great content to new users. The other thing, in addition to on-platform discovery, is this notion of Roblox Everywhere that we’ve shared. Let’s get to that, I promise we’ll get to it, because I think it’s super interesting in this context. But you’ve gotten much more into — you mentioned matching players to the right game, what have you learned from getting into recommendation algorithms? The path — I keep referring to it — but this is the social-networkization— DB: Yeah, it’s very different than video, because a game is something a user can play multiple times, a game is an environment where friends can have fun. Some good games last for years and years. You know, Adopt Me has been on the platform forever, so finding an Adopt Me that creates joy for a long time is very, very important, rather than a one-shot video. I think what we have learned is to optimize for longer-term retention rather than short-term retention. Well, that really hit your earnings when you made that shift a couple quarters ago. What was your thinking? Is that what you expected? DB: I don’t want to comment on hitting the earnings, but I want to comment that mathematically, if we can raise long-term retention — which means more people stay on the platform, more people have a good time, and, like I mentioned with Adopt Me, find games they might play for 10 years — that pencils out. And retention is critically important in growing users and growing word of mouth and growing all of those things, so we’ve gotten better and better at optimizing long-term retention. We measure it directly, we measure the contribution to long-term retention from every user-game pair. We see interesting things — different types of groups of people like different types of games and I think if we go to the Roblox home page, for example, and I play, or someone else plays, I think people are universally saying, “Oh my gosh, those are more and more looking like games that I’d like to play for a long time”. You told me in 2022 that Roblox’s initial product failed because it wasn’t multiplayer and social and that was one of the foundational lessons of the company. Now you’re enabling offline single-player games. Have you moved? Is this what has changed? What’s shifted, where — yes, of course you’ve mentioned the social aspect multiple times — but also there are games people just want to play, a great game, on their own? DB: I feel long-term the foundation of Roblox will continue to be multiplayer, friends coming together, that may be in real time, that may be asynchronous, that may be “I take a turn, you take a turn”, that may be I play a match-three puzzle at some point and compare it. What the move to single-player, the move to puzzle, is really saying with our aspiration for Universal Player and Roblox Everywhere, we have enough bandwidth now to cover the whole spectrum. When we talk about the notion of Universal Player, the notion is going all the way from a traditional 2D offline puzzle game, all the way to that which is yet to be invented — which is super high-scale multiplayer, photorealistic reality — and everything in between. So the vision with the puzzle game, as well as Roblox Reality, is going back to the video analogy. In a way, with video, the camera and the player have been somewhat invented, we have cameras all over, we have 4K, 60-hertz playback, we have playback mobile, we have playback in our living room, and so all of the video out there generally will play back on my living room 4K, 60-hertz TV. That’s not true in gaming. There’s not a universal rail, where every game as of yet invented, as well as to be invented, you could imagine it playing there, so that’s the notion of 2D puzzle and Universal Player. Presented by Agentic commerce purchases with Link, Stripe’s digital wallet that works surprisingly well for agents, grew 38x in September. The catalyst was consumer agents like Muse and Instinct. Filling out a web form is not a value-add activity for anyone. No one chooses to fill out web forms in their spare time. That’s why these agents have been particularly useful. 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So step back and explain Universal Player, broadly speaking — both in terms of the different surfaces, and also bringing in games from other platforms into the Roblox experience. DB: Part of this comes — I’ll come at it first from an AI angle, and then a puzzle game angle. From the AI angle when we hook either our Studio assistant or an MCP model up to Roblox Studio, and you or I say, “I’d like to build this”, there’s still technical constraints, if I hooked up MCP and said, “Build a game that happens in the state of California, make it a 3D multiplayer environment, I’d like it to be photorealistic, and I’d like it to be able to have up to 100,000 people all walking around and driving cars” — not technically possible. But we do want to push towards that — once again, multiplayer high-scale photorealism — as quickly as possible, and make a place for anyone who’s either imagining a game or building it with MCP server, or, as you mentioned, ultimately bringing in a game they maybe have already made and converting it to that type of environment. So if we have a Universal Player, that’s a superset of all games that can run multiplayer. You could imagine that if you had a puzzle game that’s offline, connect it up, bring some of the source code in if you want to, and we’ll convert it to Roblox. Or you had a single-player high-res game, we’ll convert it to Roblox and in that conversion process, a couple other cool things will happen. We coined the term “Robloxification” — it’s really what’s different about the Roblox architecture. Your single-player game from a PC can now be multiplayer by default, because we’re running against a cloud. Because we’re doing 3D streaming, your single-player game will also run on a phone — oh, it’s being Robloxified. Your single-player game, rather than being a 500-gigabyte download, you can just join it immediately, that’s very interesting. Your single-player game has access to economy and other things so the notion with Universal Player is really both convert, as well as Robloxify, existing games as well as new games. Is this leveraging — to go back to the discovery versus distribution — is this leveraging the fact that you want to get into Roblox’s discovery engine? There’s people on Roblox, they’re not going to go download your game individually, they’re not going to go to another website. DB: That’s exactly right, in that a game brought into Roblox Everywhere in our Universal Player will then be available in the Roblox app. And as we thought about it, what a great way to discover more content than to have great games out there that are also discoverable in the app. This is the analogy — to go back to the short-form video — where you had this story with Meta versus TikTok. TikTok realized that it’s called a social network but it’s not really a social network, it’s just really giving you the videos that it thinks you are going to like, and who you follow doesn’t have anything to do with it. Meta is stuck in their social network, “That’s what makes us powerful”, and to compete with TikTok, to make Reels into a thing , they had to let that go, “We’re just going to give you what you want”. Is there an analogy there to your embracing single-player games, to you having recommendation algorithms? And sure, Meta will tell you the social network part is important, will always be important. Is that analogous to you saying, yes, the social aspect of Roblox is important, will be important, but actually to truly grow, to reach your full potential, you have to actually atomize a bit more and meet the player with exactly what they want? DB: Yeah, I think if anything it’s even bigger than that, I’ll go through three realizations. The first realization that we’ve come to, looking at the physical world, when people play — whether they’re playing sports or a board game or any form of play, jostling around with friends — it’s typically not just play, it’s playing, it’s connecting, it’s community, it’s creating the play, “What are we going to do?”, it’s sometimes watching other people’s play, it’s dressing up to play. And so we started thinking about the market, not as the game market, but the play market, and how all of those pieces really work together so that’s been a bit of a stretching, rethinking things for us. The second is, when we say the play market, we can no longer just say, “Well, Roblox is a 3D multiplayer game engine”. You were constraining yourself. DB: That’s right. All of the constraints, I think, in the past that helped us focus and grow at a certain scale have to flip from focusing constraints to constraints we give up on. What was more difficult — convincing the company we have to let those constraints go, or did you have to convince yourself? Because again, two things that really stood out. Number one, you had this long-term vision, and it’s actually been continuous, and now you’re saying, “Wow, this has been a big shift”. But then number two, this being focused, “This is what we do”, and now you’re like, “Well, actually, no, we need to let that go and do everything”. DB: We’ve gone through several of these. The early version of Roblox was PC and Macintosh. We, for a while — if you can believe it — there was no mobile phone version of Roblox and when we looked at the iOS App Store top 100, there was no 3D game in the top 100. China was a little bit ahead, they were starting to poke at it, the U.S. was not. Giant company debate, “How could Roblox ever work on a phone? The phone is 2D. It’s not going to work”. Luckily, mea culpa, we went for it and now we’ve gone through that transition. There’s also a time on Roblox, very early on, we thought the blocky look was so simple and easy to build with, we wouldn’t allow the importation of 3D mesh objects, we mea culpa’d it, because ultimately we want all styles of game. And so I think 2D and offline is kind of one of the last holdouts for that, in saying it’s really the play market, and we can’t constrain that anymore. Are you pushed into this market, or are you pulled — just the market opportunity is so large? DB: I think it’s so much more fun and simple to just say, “We’re going after the play market”. (laughing) That’s right, let’s do it all. DB: We need integrated and safe ways for community, we need integrated and safe ways to find great games to play with, we need all of that just in a simple — it’s actually a simpler product spec and a more fun product spec. Does that mean, you as a company, you’re more defined by — maybe you’re like supply-defined, where, “What can we do, and this is what we’re going to deliver”, and now that’s sort of flipped to, “What’s the market and how can we fill that market?”. DB: Yeah, I think it leads to all kinds of interesting features of the product. For example, short-form video is traditionally used for watching by yourself. Imagine something that feels like short-form video, where you’re seeing the 3D game where your friend is already playing, and it’s a way to find a friend and jump into a game. Right. We made the short-form video comparison, but you’re literally doing short-form video. DB: Finding 3D ways to discover is super interesting, finding ways to connect with your friends is super interesting. I feel this singular vision on play is a category that’s got legs and I think the thing that is yet to be figured out is how big is creation versus playing with friends. What I have seen with the early players on Build is, there’s a lot of joy in making a short-form video on one of these platforms and having your friends see it. That happens in spikes and I’ve seen people do that. The joy I’ve seen of people creating games on Roblox and literally sitting there with their phone and saying, “Oh my gosh, I have four people in my game, and those four people are playing my game, giving me feedback” — I’ve seen that be really powerful. That’s interesting, because the feedback mechanism — you can act on it. If someone gives feedback on a video, it’s just a comment on a video. DB: And like I highlighted, board members doing 15 modifications a day to their game so that four people turns into six people. That’s really interesting. It’s like there’s a 3D aspect to gaming, as opposed to the 2D aspect of a video. This is almost like a 4D aspect, where the interaction — it’s a social network in a very different sort of way , it’s around this object that could evolve and move with the interaction over time, I think you do have a 4D product. DB: That’s right. Well, we use the term 4D lovingly in our physics engine, because 4D objects are objects that have behavior and code and do things, rather than static objects. The other topic you’ve brought up continuously is Roblox Everywhere. First, explain what it was — I have some questions about this that are connected to what we’ve been talking about. What is Roblox Everywhere, from the top? DB: We shared earlier, our jump from PC, Mac, “Oh my gosh, we’re doing mobile, could it work?” — and then we shared some of the other changes we’ve made along the way. One of the things, for quite a while, we’ve held on is: 100% everything is in the Roblox app. DB: But as we’ve seen our vision of the Universal Player — the vision that, whether you build on Roblox or you convert or you use AI, below the rails, Universal Player is the place a game can be constructed and run at scale — as we thought more and more, all of a sudden the power of what is the Universal Player becomes appealing, not just in the Roblox app, but possibly for a creator who wants to ship a standalone game in the iOS App Store, the Google Play Store, on their PC, on a console. And as we thought through it, the benefits of giving creators access to the Universal Player, even when they’re not in the app, brings an enormous advantage to us, which is that their content can then be available for discovery in the app. That gets to my question. Okay, I’m on board with the releasing, let’s be on all devices, let’s not just have blocky characters, let’s have 3D characters, all the things we’re talking about. But I’ve been framing this whole discussion — we’ve been comparing to short-form video, which is an Aggregator play. You own the end users, you own the consumers, you have Universal Player, people can bring their games in to reach the customers, you have an advertising business that we talked a lot about last time, I have some questions about. Roblox Everywhere seems to be like the whole company is now flowing in one direction, you have the Roblox place — if you want to make a game, go there, there’s customers there, there’s monetization there, it’s all there. And now you’re like, actually, let’s open up a trap door and let everyone go out the side, am I the one that’s now being the wimp and saying, “Can you be a little bit more focused”? DB: I appreciate your insight there, but what’s really exciting to us is the potential to get such a large percent of the gaming market running on Roblox Everywhere, and the potential content explosion that happens within our app. The way we thought about Roblox Everywhere is, if you’re a creator — you might be an indie creator just pushing a small app, you might be a large studio — the more we can have both the most amazing technology platform, really Universal Player, and the more it makes absolute sense for you to run on that technology platform, whether you’re in the Roblox app or standalone, we get the benefit of that content in our app which is social, which can be launched instantly, which shares a common social structure, which carries a common safety structure, a common economic structure, all running together. So our calculus — and as you said, maybe it looks risky or whatever — but our calculus is actually, this is the best way to grow users in the Roblox app itself. Yeah. Well, it’s interesting because I think this gets on the — I’ve been drawing the analogy, we’ve been drawing the analogy jointly, between short-form video and gaming. But to your point, gaming is still a lot more difficult and if you go through the history of gaming over the last 40, 50 years, this has been a trend is over time, just the cost of developing gets so large, you need to be multi-platform. The PS3, one of the all-time examples, builds this super complicated, powerful architecture that no game ever leverages, because the cost of creating HD assets is so much higher . They need to be on Xbox also, they need to be on PC, and so everything goes multi-platform, Sony responds by doing the exclusive strategy, etc. Is this a similar articulation, that making games is hard, and so if we don’t make it so developers can run their games everywhere, they’re not going to be on Roblox either? DB: It’s really hard and right now there’s a bifurcation, a lot of times, between that super cool high-end PC game I see and what I can run on my two-gigabyte Android phone overseas. Those typically are different products. And so you’re trying to make the whole world the market for a developer — if you build on this, the whole world will be your market? DB: Imagine if it was technically feasible to build for super high-end AAA multiplayer on a PC, and connect to the same game on a two-gigabyte Android phone overseas. That’s a technical opportunity, we think, for creators. How is that different from streaming? Like, you stream a console game to your phone, what is different about what you’re proposing? DB: There’s a very creative history of what is called game streaming, where the game is run far away, I send my keyboard and mouse to the game, and then video comes back. (laughing) Right. And it sucks. DB: And this was even 20 years ago — Gaikai, OnLive, OTOY — we’ve seen a long history of this. You said it sucks, the way I would say it is, some of the things we’re doing in our video — you and I are on a Zoom call right now, when I look at my character, my character’s reacting instantly, I feel like I’m looking in a mirror, in a pure video streaming architecture, I might move 50 or 100 milliseconds later than when I do that, and people are very sensitive to that. If you’re close to the video server, maybe it’s pretty fast but I do believe having local 3D instantaneous feedback is super, super critical. So that could be one reason why video streaming just hasn’t kind of exploded as much as we thought. Is there an issue where streaming — they’re trying to retrofit what existed, and you’re natively building for this experience, and that makes a difference? DB: We want native 3D, you know, we want multi-device native 3D, very low latency happening on those. There’s some other dimensions where gaming is getting more difficult as well. The regulatory environment — it’s not like the old days if you or I make a game. There are different laws in every state and in every country, cultural laws, all of those. One of the opportunities is to have a platform that can automatically adjust to that — what are all of the rules around age, around ratings, around all of those things? That’s another thing that can help a creator reach the world without having to think about all those things. How do you think about monetization for the Everywhere games? Is there going to be like a platform fee, like a Unity sort of aspect? Or is the payoff, “If they’re building using our technology, they will also be in Roblox, and that’s where we’ll make the money”? DB: We shared at RDC the notion that monetization may be somewhat similar for games Roblox would publish. And so if you went to an app store, there may be some games published by Roblox that are the exact same games that are inside Roblox. We would only do that with the developer’s permission, but it could be really cool — you could go to your app store and search for “Grow a Garden” and say, “Oh my gosh, there’s the game”. For games where the developer is pushing directly to the app store, we haven’t shared the economics but in the thesis of what I said — which is eliminating any reason for the creator not to think about it — that leads to the economics needing to be pretty provocative and so stay tuned on that. Where is advertising fitting in this and your vision overall? Give me the advertising update. We spent a lot of time on that three years ago. DB: We shared on the earnings call that we’re more and more excited, and we’re all in, not just on Roblox platform advertising, which is growing, I think we shared that’s growing very quickly as well. As creators come into Roblox and use Roblox Studio Assistant or Build or MCP, “Okay, I need to get some initial traction, I need a thousand users”, those ads are available on the Roblox platform. And isn’t that the great thing if it’s abundance, there’s too many games, you have to discover it — user acquisition ads are very profitable. DB: We have seen an acceleration of that type of advertising and to take that all the way back to the prior analogy, we have board members on their phone buying advertising. (laughing) Conflict of interest, they’re bumping up their own stock price. DB: There’s a second type of advertising that, more and more, is becoming available, which is very short, five-plus-second skippable pre-roll video. There was a time, way back in the history of Roblox, we tried pre-roll video, it was not a good experiment. The quality of the video was not super exciting, pre-roll video at that time was 30 or 45 seconds. Technically it was a pain in the butt, and we yanked it out because we didn’t like the user experience. That kind of left us with, for a while, “Uh-oh, no pre-roll”. But today, the fun and the quality — if we’re very selective of the brands, and we could imagine the brands that are interesting to a 21-year-old Roblox player — clothing brands, electronics brands, movie brands — where they might actually say, “It’s pretty cool to see this”. We also, because typical games on Roblox launch not quite instantaneously — they launch maybe in five or six or seven seconds. Right, you have time. DB: There’s actually a beautiful technical overlay there, if we do it right and do it natively, to put this all together so we’re very excited about this potential combination. Is there an aspect where companies, especially when they’re first doing advertising, they overthink it? Like, “We have to have the world’s most inventive ads, there’s going to be billboards in the game, and these experiences” — and actually, no, just show a pre-roll video, it’s fine. DB: I think that’s right. I think we have a history of thinking big, and I do feel ultimately there’s going to be a wide range of types of branding that people do. There’s a lot of immersive 3D potential for literally shopping in 3D and doing all of that but there’s also an enormous quantity of pre-roll video. Right, you can get to that eventually, there’s actually a lot of low-hanging fruit, it feels like a lot of first-time advertiser platforms — they’re reluctant to pick, and then they’re like, “Actually, let’s just pick the low-hanging fruit and go from there”. DB: I think that’s right and I think in a COPPA -compliant, privacy-compliant, Roblox-values-compliant way, we can still imagine amazing user experience for advertising. Does this tie into the potentially provocative pricing for Everywhere? Where you make a game, it’s everywhere, congratulations — but if you want to actually make money, you’re going to need to be on Roblox and that’s the best place to spend money to acquire users. It’s better than spending on Meta, better than spending on wherever else it might be. DB: You could imagine, in under 18 on Roblox, we’ve shared we may have literally 20% of gaming revenue in the U.S. flowing through the platform and so that’s huge penetration in that age group. As we move towards that same penetration over 18, all of a sudden the value of advertising on Roblox for my new game becomes more and more valuable, because those users are already there. Are older players like your great white whale? I think every time that we’ve talked over the years, it’s always been, “We’re going to expand into older players”. When is that the reality, as opposed to the opportunity? DB: Reality is right now, the fastest-growing thing on our platform is 18 and up, it’s growing very fast. Are you getting new users, or is it people aging into and sticking with Roblox? DB: Absolutely, both. It’s a smaller cohort than the under-18 thing. But as it becomes an increasingly larger percentage of our revenue, it will more drive the growth rate of the top end as well. And how does that relate to the single-player offline, new types of gaming, puzzles, and all the things you’re talking about? DB: I think there are some of those segments that are very much 3D multiplayer, some of those segments are puzzle. There’s an overlap in that, as we think about the whole play market and we don’t restrict any types of games going forward, we have more opportunity to really create a good chunk of that market and once those users are on our platform, they’re very valuable, because other games can be attractive to them as well. In our first interview you talked about how you deliberately avoided paid acquisition, because organic virality was so essential to Roblox, in part because of the social aspect of the games. DB: I think we were careful with it. It’s a much bigger thing now, right? DB: For under 18, even in our early days, we experimented with paid acquisition, but we are very careful with always getting a return on the spend, and always knowing that organic viral had to be the biggest, but there still is a logical amount to spend. And we’re doing the same on over 18 right now, we are mixing organic with paid, there’s an optimal mix of them. We always want whatever we spend on acquisition to make incremental revenue more than what we spend and we are sticking to that hygiene. So it does make sense for us to do the paid acquisition. Is Roblox a metaverse? Is that still the dream? I like the word, no one else does. DB: I feel it’s weird how that word kind of came and went a bit but I think over time, maybe that word will come back, right? Because in the ’80s, ’90s, and 2000s, that was a very popular way of describing not just a gaming platform, but a communication platform — a place where people came together to play or to work or to do a bunch of things. I do feel ultimately, beyond gaming, that still makes sense. This Zoom call, at some point, will be a 3D simulated metaverse call, and we’ll be able to run in traditional 2D mode, and we’ll be photorealistic but if I wanted to go and look at that globe behind you, and I asked your permission, I said, “Ben, can I come and see the globe?” — you’d say fine, hopefully, and I’d come and look at it. And that’s something we can’t do on Zoom that will be unique to, ultimately, a metaverse call. It is a very cool globe. I got it at an antique shop. It has, like, a barometer in it, a thermometer, and it actually lights up — it is a lamp, also so it’s my background. DB: I love globes, I love telescopes too. Well, there you go. With the metaverse, with this 3D world, you just talked about a real-world thing, you could come into my room. But to go back to the example, you mentioned the developer that wants to build the state of California and driving cars around and 100,000 people, is this ultimately going to be realized, not through polygon drawing, but it’s all just going to be AI-generated ? DB: I don’t think it’s going to do that, and the reason we’re building this Roblox Reality architecture — and I’ll share a bit about it — is we do want, “What’s the quickest way to get to multiplayer, photorealistic, immersive gaming?”. Multiplayer is where the fun part comes in, and it’s why we talk hybrid. So in the movie business, there’s several famous directors right now who are going hybrid and what they’re doing is, they’re either shooting live actors, or they’re building a very rough scene for their movie in a 3D system, then they’re taking the 3D information and they’re upsampling it with an AI model to 4K photorealism and so they’re putting together the best of traditional — and in the case of live actors, there’s much more accurate capture of the face, of the emotion, when shooting real film for the actor, but then you can decorate the set however you want. In gaming, synchronizing 10,000 players needs to be done in the most efficient way possible and doing that in a video latent space is not the most efficient way, doing that in a rough 3D representation is the most efficient way. But for every one of those 10,000 players, it’s getting a pretty efficient 3D representation, you can imagine each one of them uniquely getting an AI video model upsampled for them specifically that looks like 4K, photorealistic 60 hertz, and I think that’s where it’s going to come out. Are you going to win on doing this because you have a technical advantage, you pull it off, or because you already have the audience? Lots of people could build this out. DB: I would say yes and yes, hopefully. This is a vertical integration play, the vertical integration. Right, which has always been a core part of Roblox’s theory. DB: I’ve played with, for example, Grow a Garden, or classic games on Roblox, with early versions of photorealistic upsampling, and it works out of the box. There is a notion that existing games can run for all players, same gameplay, but for some, photorealistically upsampled. But I also feel it’s a technology play, because most of the video models that are being built today are either single-player world models, or video generation models — like you or I want to use one of these models to make a cool 15-second video. This technology is different, this is real-time, low-latency video being generated from the 3D video and the 3D depth map and a bunch of other things, so it’s a very specific type of video model that has some overlap, I think there’s opportunity both for technology as well as vertical integration. The thing that I’m taking away is — and this has always been the case talking to you — the scale of the ambition, but it does feel like the big shift is actually, “Let’s literally do everything, let’s do the supply side, we own the demand side, let’s do all kinds of games”, is that what Roblox is today — we’re all gaming, period? DB: I would say, do everything within the carefully thought-out boundaries of the future of play. And so within play, yes, let’s be open to 2D puzzle, let’s go all the way from two-gig Android to photorealistic Roblox Reality and in between, let’s make things available in the Roblox app as well as in Roblox Everywhere. So I would say, within those hopefully thoughtfully constructed guardrails, then yes — in a way, it’s do everything. Do you feel okay without the focus? Without knowing, “This is what we do”, is, “We do everything” — is that focus in its own right? DB: It is focused, because there’s still some pretty tight guardrails. And so I think, given the size of the company and the ability to use AI to accelerate engineering, I think it’s the right current product spec — just like when we started, it was PC-only, blocky, and that was good enough. Last question, you mentioned the AI component. This “do everything” — is that downstream of, “Now we can use AI to program”? Or did the AI programming come on just in time to make this vision possible? DB: For many companies, I think like ours, back and forth, iterate, iterate — AI engineering acceleration, expanding maybe the definition of the product spec, AI engineering, expanding the definition of the product spec. But I do think companies around the world are now starting to take things that they thought would be a nine-month project, and thinking of it as a two-month project. How do we rethink how we architect, to make these nine-month projects two-month instead? Very good. David Baszucki, very interesting, very cool to see what you’re doing. DB: Great talking with you. Thank you again, Ben. This Daily Update Interview is also available as a podcast. To receive it in your podcast player, visit Stratechery . The Daily Update is intended for a single recipient, but occasional forwarding is totally fine! If you would like to order multiple subscriptions for your team with a group discount (minimum 5), please contact me directly. Thanks for being a supporter, and have a great day!
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