• Famed for selling virtual goods, Roblox now allows brands and creators to sell physical items.
• Roblox's ambition is to capture 10% of the $180 billion global gaming market.
• Creator studio Twin Atlas is selling merch via Roblox, and Warner Bros. is selling movie tickets.

Roblox is known as a Gen Z destination for gaming and hanging out. Could it soon also be the place young people go to shop?

That's Roblox's stretch goal, at least.

Roblox on Thursday said it was expanding its commerce program, allowing more creators and brands to sell physical items — think hoodies, lipsticks, plushies, and concert tickets — without leaving the platform.

The commerce push forms part of a broader companywide ambition for Roblox to make up 10% of the $180 billion global gaming market. To do so, it's diversified its revenue streams, generating income from subscriptions, the sale of virtual goods bought using its virtual currency Robux, and through advertising.

"Everywhere there's digital goods being bought, we will look at ways in which there is an opportunity to actually buy physical goods," Louqman Parampath, VP of product for ads and commerce at Roblox, told Business Insider.

Starting in the US, creators can integrate items from their Shopify catalogs into the virtual experiences on Roblox for users ages 13 and over (and 18-plus in Texas) to buy. The company said more commerce partners and locations are on the way — it previously partnered with Walmart on a trial to sell physical items, for example.

Parampath told BI that over time, he envisions Roblox becoming more of a marketplace-style offering, and famous stores like the Nike store might appear across several popular Roblox experiences.

"Our plan is to have much deeper product-catalog integrations, which means the variety and diversity of products that will be available across our experiences, and perhaps even a marketplace, will continue to grow," Parampath said.

Roblox has been outlining its real-world commerce plans since at least 2023, and began testing last year.

The company said the creator studio Twin Atlas generated "six-figure commerce revenue" in a few weeks after it began selling T-shirts and hoodies in Roblox games like "Creatures of Sonaria" and "Dragon Adventures." Fenty Beauty and Warner Bros. were also early testers of the commerce program. Twin Atlas said around 90% of its merch sales now come via Roblox versus its own website. Elsewhere, pop star The Weeknd is launching a ticket bundle within Roblox for his coming feature film "Hurry Up Tomorrow," which will be released in movie theaters later this week.

James Poulter, head of AI and innovation at the marketing agency House 337, said Roblox will need to ensure the commercial expansion of its real-world shopping efforts doesn't disrupt gameplay and provide adequate controls to prevent its young users from overspending.

"At worst, it risks becoming an Amazon-on-steroids scenario where children are immersed in a commercial environment that parents may not be comfortable with," Poulter said.

Roblox said goods sold must adhere to its newly published commerce standards and other applicable policies, such as its community and advertising standards.

Roblox sees commerce as a flywheel for its ad business

Roblox is also bringing virtual goods to the real world. Through its Approved Merchandiser Program, brands can add a Roblox badge to their packaging and merchandise that contains a code which can be transferred for digital items users' Roblox avatars can wear and use.

A Roblox spokesperson said that the company doesn't take a cut from sales of physical items bought through the Shopify integration but will earn a commission from any paired avatar item or developer product sold. Those fees can vary, determined by the total price and price ratio of both the physical and virtual item, exclusivity, and category of the item, the spokesperson said.

Parampath said Roblox is also hoping these efforts can help prove the effectiveness of its advertising to marketers.

"If you run a campaign for any particular product and that particular product is also purchased on our platform by a subset of our users, you can effectively close the loop," he said.

Chris Camacho, CEO of the ad agency Cheil UK, said commerce on Roblox will be of particular interest to fashion, beauty, and lifestyle brands looking to reach younger audiences. Roblox said it had around 97.8 million daily active users as of its first quarter, 62% of whom were over 13.

"For Gen Z and Gen Alpha, seeing an avatar in a hoodie, a lipstick or a pair of trainers and being able to buy the real thing on the spot just makes sense," Camacho said. "This is commerce on their terms: instant, contextual, and embedded into the experiences they already love."

• Roblox is an enormously popular digital playground with a very young user base. It's worth some $40 billion.
• A key challenge for Roblox CEO David Baszucki: figuring out how to police a user-generated content platform where many users are under 13.
• It's a tricky question. How much responsibility should Baszucki have for kids' safety and behavior on his platform — and how much should parents have?

Do you let your kids play Roblox?

Many, many parents do. The gaming platform has a huge audience — some 85 million people visit it daily — and about 40% of them are under the age of 13.

But Roblox's youthful user base is also a question mark for the company. Some people worry that the platform, which hosts millions of user-generated games and encourages kids to chat with each other, is an attractive target for predators. Others simply worry that there isn't enough oversight at the giant digital playground, which allows kids to play everything from dress-up games to ones that mimic school shootings (Roblox recently shut one of those down).

Meanwhile, Roblox is trying to convince investors — who currently value the company at $40 billion — that its future growth will come from older teens and adults.

It's a complicated question for Roblox CEO David Baszucki, who co-founded the company back in 2004 and launched it in 2006. On the one hand, Baszucki is trying to convince regulators and parents around the world that Roblox is safe because his company spends a lot of time and effort policing the platform; on the other hand, Roblox owes its success to the fact that it's a platform — just like YouTube, or Facebook, or TikTok — whose users decide what they want out of it.

I talked to Baszucki for my Channels podcast, and our conversation ended up touching on a wide range of topics, including the company's relationship with Apple and Google, and its approach to intellectual property. This edited excerpt focuses on Roblox's double-edged age issue:

Peter Kafka: Roblox has a big, young user base. You get a lot of criticism about it. Sometimes the concerns are about grooming on the platform. Some parents just think the games are uncouth or just don't like the idea of kids talking to other kids in an unregulated way. Has your thinking about the issue of kids on your platform changed, or has it been consistent since you started?

David Baszucki: I think in retrospect, when we think about starting the company for all ages, 18 years ago, we're very glad we did that. It was a really hard thing to do. It's much easier to build a gaming platform that's 13-and-up, which is where many social media apps are today.

And when something's built for 13-and-up, it can create a situation where you don't go straight after the real big challenges. For us, literally in the first few months of being live, we started building our first safety systems and made it a top priority. There was a time when the four of us who were the Roblox founders were in the room moderating. Each one of us took a day.

That has evolved over the last 16 to 18 years to the development of over 200 AI systems, automatic filtering of all text on the platform, automatic filtering with human supplement of all images on the platform. I would say over time we have gotten better, better, better, better, better. [But] any single issue for us is one too many.

And we do treat any issue as one too many, but we're very optimistic that we're going very much in the right direction and that the value of embracing this prevents what happens when 8, 9, and 10 year olds are on a 13-and-up platform that doesn't have these same ways of maintaining safety and civility.

So it's a hard challenge. We've embraced it.

Do you feel like the perception of the brand has changed over time? I can talk to my coworkers who've got young kids, and they say, "I don't want my kid to get on there. I want them to stay on Minecraft. I'm worried about Roblox." And they might not even be able to articulate what their concern is, but they've just heard it's bad, or they're worried about it. Does that filter back to you? I'm assuming you guys are hearing that all the time.

We take that very, very seriously.

What we have seen over the last four to five years — so many parents recognize the benefits and differences between a 3D connection platform versus maybe a social media platform where you're watching videos or you're sharing pictures of yourself.

And during COVID many, many, many parents around the world said, "Oh my gosh, this is a way for my kids to stay in touch with their friends" in a way parallel to maybe when I was younger on a rainy day, I used the telephone and I'd call my friend up and we'd hang out on the phone for half an hour. People are doing that on Roblox right now.

I feel there's a general recognition in society that connection is a positive. We see it all the time on Roblox. And I do think parents are getting more savvy about that type of connection versus short-form video by yourself or getting catfished by sharing your picture on a social media platform. Once again, we take everything very seriously, but the vast majority of parents we run into are very supportive of our platform.

You talked to the BBC recently and you were quoted saying, essentially: "If you're not comfortable, don't let your kids be on Roblox."

On the one hand, that totally makes sense to me. I'm a parent, I get the logic of it. On the other hand, I could imagine parents saying, "Wait — you're putting all the responsibility on me and you've built this platform. Isn't it your responsibility to control this thing?"

I would put a bracket around that single statement. And that bracket was a dialogue we were having around just so much we do, because we know not all parents are able to get on the platform with their kids and set parental controls. There are many parents who are so busy in their life — they hand their youngster an iPad and say, "Go play Roblox."

So we have to be ready for the parent who isn't able to be involved. And we have to be, I would say — even from a company values and moral responsibility — driving the vision on that to be a great place for civility and optimism.

In the middle of all of that we do, I would say definitely to parents: "We're doing a lot, like we're gonna focus on it whether you're an involved parent or not. If you're uncomfortable with your 12-year-old in any situation, whether it's Roblox, whether it's the community pool, whether it's the playground, whether it's anything … we stand behind you."

There's a debate going on now — it's really between Apple and Meta — about who should be responsible for determining how old a user is. Where do you come down on this? Should this be managed on the device level? Should it be the application?

We would love it if every device in the world said the user of this is exactly 11.2 years old and it's been validated. The reality is we can't wait for that. And the reality is we're not sure if and when we will have that.

We've taken the notion that we will get better, better, better, irrespective of that. And if we get a signal like that, we will welcome it. We are leaning into our own age estimation. We are leaning into, I think, a really interesting area, which is not just 12-and-under, but the 13-through-17 area. And the 13-through-17 area is — independent of age estimation — very sensitive because that's a very sensitive part of the life of young people.

And in most platforms right now, they can chat unfiltered with whoever they want. A lot of things happen in that area.

So I think we're moving to a point where, for older people who we know who they are — you could imagine you and I are going to play poker and we're going to talk about whatever we want. We're going to not be filtered, possibly not be recorded, like let's embrace free speech and the laws of the physical world.

But for 13-through-17-year-olds, we're gonna be very thoughtful about who they chat with, and if and when they get to know who that person is in the real world.

• Roblox could move its corporation from Delaware to Nevada.
• Shareholders will vote on the possible move in May.
• Some companies have followed Elon Musk's decision to reincorporate his companies outside Delaware.

Delaware's reputation as the country's most corporate-friendly state has taken another hit.

Roblox is now the latest company to propose leaving Delaware, according to a note it sent to its shareholders this week. Numerous other major corporations — like Dropbox and Bill Ackerman's Pershing Square Capital Management — have also said in recent months they planned to leave Delaware. Meta, too, is rumored to be considering a move.

The trend began with Elon Musk, who moved Tesla and SpaceX out of Delaware last year after a Delaware judge sided with some Tesla shareholders to block Musk's $55 billion pay package.

In the note, Roblox's board of directors, who have already approved the move, urged shareholders to support the proposal.

"We believe that Nevada's corporate law framework and statutory regime aligns with Roblox's culture of innovation, values, and mission to connect the world with civility and optimism," the company said in its note to shareholders. "It also allows us to continue to build shareholder value by providing a supportive, predictable environment."

The ongoing exodus is devastating for Delaware, which has long been considered the country's most business-friendly state. According to Delaware's government, the state is home to some 2.2 million registered entities, which contribute millions to its revenue. In 2024, more than 80% of IPOs in the United States were incorporated in Delaware.

Delaware Gov. Matt Meyer has moved to make changes to address concerns.

"The fact is Delaware is the best location in the world for a company to incorporate and that's thanks to our legal expertise dating back to 1792," Meyer told Business Insider in February. "But let's be clear: If any entity leaves Delaware, we're going to work to win them back."

Meyer said the balance of shareholder and management rights is one of the areas the state intended to address. "We're cognizant that there may be some things that need to change. We're going to work on them," he said.

On March 25, the governor approved a number of proposed changes. But for some corporations, those fixes might be too little too late.

A Roblox spokesperson told BI the company believed reincorporating in Nevada could "provide a stable and predictable legal environment in which the Company can focus on innovation and growth."

Roblox announced Monday that it’s launching the first iteration of its 3D model, dubbed “Cube,” to allow creators to create 3D objects using generative AI. The company also launched an open source version so anyone off the platform can build on it. Announced last year at Roblox’s annual developer conference, the company is demoing Cube […]

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As scrutiny around Apple and Google’s app store fees ramps up around the world, Roblox is now offering users who buy its game currency, Robux, on the web and via gift cards 25% more than they would get if they purchased from an app store instead. In essence, the company is encouraging users to purchase […]

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