Sharing the Upside
How Replit invited users on its journey to bring the next billion software creators online
- It was April 2022. A few months after raising an $80M Series B from Coatue, a16z, Paul Graham, and many more, Replit invited its community to invest in a $5 million Community Round.
- Having already set up a landing page on Wefunder, Replit founder Amjad Masad teased the idea of letting the community invest in a tweet.
- At 9:00 AM on the morning of ReplCon, Replit’s first annual conference, Amjad announced the Community Round launch. Then and there, the page filled up to millions of funds raised.
- "I wanted people who were paying attention, people who are in the community, to get the initial allocation.” —Amjad Masad
SHARING THE UPSIDE!
We’ll have Replit CEO Amjad Masad take it from here →
What is Replit?
Replit is an online programming environment that makes it very easy for both beginners and professionals to get started. Typically, you start programming by spending hours, if not days, setting up a development environment, a place where you can code and run your code. Then, if you want to share your program or host your app, you need to learn another platform and take potentially weeks and months to set it all up.
Replit takes that entire process and collapses it into your browser, similar to Figma and Canva for design, Runway for video, and Google Docs for editing.
Basically, every desktop app is becoming a linkable browser app. Programming is one of the hardest, because you need to share an entire computer via a link. It is exceedingly difficult, but that’s what makes Replit successful: we try to turn the impossible into a good user experience.
Using Replit, you can pick a language, start coding, host your app, share your code in real-time with other people, and publish your app on our community, where you can get your initial users. Replit also works on your phone, on any device, so you can be on the move and still fix your website.
The idea came from college, took a lot of twists and turns across different companies, and became incorporated as Replit in 2016. Since then, we've been on a massive growth trajectory. Today, 10 million users code on Replit from over 200 countries, and 80% of our users are based outside of the US. Collectively our users have created and hosted over 20 million websites and apps, and those websites and apps get over 10 billion visits per month.
I am an engineer, and I like hard problems. A lot of companies pivot until they find the easiest market they can serve, but for us, it's bulldoze, not pivot: find the hardest thing and really go through it and solve it. That's why we wound up with a very unique product.
I am an engineer, and I like hard problems. A lot of companies pivot until they find the easiest market they can serve, but for us, it's bulldoze, not pivot: find the hardest thing and really go through it and solve it. That's why we wound up with a very unique product.
Amjad MasadCEO at Replit
We’re successful at community because we love our users.
Today we’re bombarded by an endless amount of entertainment. You can learn anything on YouTube. You can lose so many hours on TikTok. Netflix is the Library of Babel for movies and shows, and video games are becoming so, so interesting. So, these days, when someone dedicates time to using your product, I think that's a huge achievement, especially if your product requires upfront time investment.
For that reason, anyone who was using Replit was someone we respected. We spent a lot of time with them naturally. That's how the community started forming.
Our first community space emerged when a 13-year-old kid built a chat room on Replit and hundreds of users were hanging out there. Seeing that people wanted a place to hang out, we created our Discord.
We also noticed that people would share their apps and their programs onto our support forums to get feedback, so we created the Community space. There, Replit users can share their code in real-time, publish their apps, and even get their initial users.
Ultimately, it comes down to us loving the people we serve. We care a lot about our users. We care about their pains, we care about how they feel using Replit. We build tools in response to the behavior we see in the community, and people notice that. So when we opened our community round on Wefunder, it went viral and filled up super fast.
We build tools in response to the behavior we see in the community, and people notice that. So when we opened our community round on Wefunder, it went viral and filled up super fast.
Amjad MasadCEO at Replit
Why we decided to raise a Community Round
One reason is that it just feels like the right thing to do. A lot of people contribute to Replit’s success and have asked to be part of our journey and get part of the upside. Some people have even called us out as hypocrites. They've said things like, “You talk a big game about making programming more accessible, but you take money only from the ivory tower of Silicon Valley. Why wouldn’t you let investors like us invest?” I thought those were reasonable arguments.
The second part is that I believe it will create a much stronger community. People who are incentive-aligned with us today will help us grow. We’re already seeing this with our Wefunder investors: they continue to send us referrals, potential deals, and candidates all the time.
Anyone who’s started a company would know that angel investors tend to be the most helpful. Maybe not on an individual basis, but overall, if you have enough of them on your cap table, angel investors can help in these very diverse ways, as opposed to one VC who’s very focused on helping you with talent or something like that.
Lastly, I like to be part of the future, and community rounds are part of the future. Retail investors have been locked out of the startup market forever. That feels wrong. The private markets are an insane wealth creation mechanism that’s been inaccessible to the average investor, and by the time many of these companies reach the public market, especially recently, people start losing money. Wefunder's doing an amazing job of changing that, and we wanted to be part of it.
I've always found benefit from having angel investors, so why not have thousands of them? That's the idea behind Wefunder.
Amjad MasadCEO at Replit
Why did people invest?
3 recommendations for other founders considering a Community Round
1. Actually get really comfortable with the laws that allow community rounds—some of which are very recent. Wefunder makes it a lot easier to understand these laws. If you have a GC or external counsel on top of that, the laws are the first step to figure out. Once you understand them, try to build up momentum and try to engage people.
2. Treat your social media presence as if you're talking to potential investors. Give people updates on what you're working on. As you're talking to customers, get an idea of whether they’re really excited about what you're doing and whether they want to be part of the community.
3. If you're building a business that really benefits from a community, then I would spend more time thinking about these questions: How do you build a community? How do you build brand affinity? How do you cultivate a sense of mission, not only internally in your team, but also externally in your users and community members?
Once you do all of that, you’ve built up a lot of energy that you can pour into Wefunder.
Summary
Replit raised $5 million from 2,588 investors during their Wefunder Community Round.
Snapshot of Replit's Community Round (source wefunder.com/replit)
Before the Raise
- $80 million Series B led by Coatue in November 2021
During the Raise
- 2588 investors reserved $5,240,140
- Started and finished in 6 weeks
- 64% of investors invested $1000 or less
- 95% of investors were non-accredited