As the instant messaging app Telegram has seen outsized growth recently to the tune of 25 million new users in 72 hours and a total of over 500 million global users, the costs to fund the app is surely rising when it doesn’t even have a revenue stream yet. 

The chat app has since its start been funded by the personal fortune of its creator Pavel Durov, who previously founded the Russian Facebook clone VK and walked away with a reported $300 million from its sale. With mounting costs, it now seems that Telegram has sought to raise outside funding for the first time.

Telegram is in talks to raise hundreds of millions of dollars in convertible debt according to a report from The Information, underscoring its need for significant cash to fund its explosive growth. According to the report, the Dubai-based startup has discussed with banks and investors to raise debt funding that’ll convert into shares in the case of a public listing.

As it looks, Telegram won’t seem to struggle to look for investors given that it’s drawn interest from many onlookers globally. Being one of the top ten messaging apps globally, it looks like investors will rush to fund it at any chance.

Telegram doesn’t yet generate revenue but will presumably try to do so anytime from now. The company had tried a revenue stream in a blockchain platform but later abandoned its plan after opposition from regulators.

If Telegram plans a public offering sometime in the future, it’ll definitely have to form a major revenue and monetization stream. It’s already begun working on that with ads on public channels. Another hypothetical way it could make money is from selling in-chat stickers and virtual items, a way that’s worked very well for the Japanese messaging app Line.

According to The Information‘s report, the planned debt round for Telegram could top $1 billion, which would be unprecedented for a messaging app. Being Dubai-based after its founder Pavel Durov exiled from Russia, Telegram may end up as one of the biggest and landmark commercial tech ventures to emerge from the Middle East.

Photo: Telegram founder Pavel Durov, credit: TechCrunch, licensed under CC BY 2.0

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