Why founders avoid VC funding

Startup Feature
Bootstrapping a $35 billion startup

Telegram, founded in 2013 by Pavel and Nikolai Durov, is now one of the world’s largest messaging platforms, serving over 700 million active users. Valued at an estimated $35 billion, the startup has not raised a single dollar from outside investors.

Building Telegram Without Investors

Before Telegram, Pavel Durov was best known as the founder of VKontakte (VK), which had become the Facebook of Russia. However, Pavel was ousted from his own startup and forced to sell his 12% stake for a reported $300 million after refusing to hand over user data to the Russian government.

Determined to create a platform free from censorship and external influence, Pavel turned his attention to creating Telegram.

With Pavel financing the operation and Nikolai, a mathematician and cryptography expert, developing its encryption technology, the brothers built Telegram with a clear focus on privacy. MTProto, Nikolai’s encryption protocol, became the foundation of its secure messaging system. By bootstrapping the platform, the Durovs maintained full control and avoided compromises associated with external funding.

Telegram launched in 2013, gaining 35 million users in its first year. Its features, including ad-free messaging and strong encryption, resonated with users in regions with high levels of surveillance and censorship.

A $35 Billion Startup Valuation

Telegram’s $35 billion valuation is the result of a deliberate and efficient approach to growth. The platform has grown to over 700 million active users without external funding or advertising, relying entirely on product development and user recommendations.

With just 30 developers, Telegram operates with a lean team compared to Facebook’s 70,000 employees. This lean approach has allowed the platform to remain efficient and focused on delivering value to its users. Key features like public channels, bots, and large file-sharing capabilities have attracted businesses, creators, and messaging communities to the app.

Telegram’s valuation, now estimated at $30 to $40 billion, is driven by its massive and engaged user base and its reputation as a secure and reliable platform. Unlike ad-driven competitors, Telegram has built its success on trust, independence, and solving real problems for its users.

Telegram’s Founder Jailed in Paris

Telegram’s growth hasn’t been without controversy. Pavel Durov was recently arrested in Paris over allegations tied to the platform’s use by protest groups. Critics argue that Telegram’s lack of oversight enables illegal activities, leading to increasing scrutiny.

Despite the controversy, Durov stands firm on the guiding principle of Telegram, that “Freedom of communication is not negotiable.” while his arrest had fueled user growth for his app while he remains detained in Paris.