- A lot of the work you do is with blocks.

It's the core shape of the platform.

- [Narrator] Samuel Jordan has been making video games

since he was 15 years old.

- I've gone from making clothing stores

to 3D cafes and food restaurants

to now full-fledged games.

- [Narrator] He's made all of these

on a free online gaming platform called Roblox,

which is available on Desktop, mobile devices

and Xbox consoles.

Last year, at the age of 21,

Jordan earned more than $600,000.

- Not yet.

- [Narrator] He's among the seven million Roblox developers

who've built the company a library

of over 20 million games and experiences.

And this has attracted about 33 million daily users

and more than half of them are under the age of 13.

The pandemic fueled this model

and Roblox became a place

where kids at home could hang out.

This has made it one of the valuable video game companies

in the world.

And its first day of trading in March,

saw a market valuation of $45 billion.

But as new games are created every day,

the company faces the challenge

of moderating its platform.

And its business model rides

on whether Roblox can remain a safe place for kids.

- My daughter's obsessed with Roblox.

I know this platform way too well.

She loves "Royale High."

- [Narrator] Sarah Needleman covers the video game industry

for The Wall Street Journal

and she's been spending a lot of time on Roblox

with her daughter.

- Got this yesterday.

- [Narrator] An even owns a copy

of "The Ultimate Guide to Roblox."

- All of the games on the platform

have been made by users.

Some are just individuals like you and I

but the company itself doesn't make the games

that are on the platform.

- [Narrator] This means Roblox doesn't have to rely

on Hollywood-like budgets

and rockstar talent to produce blockbuster titles.

For example, one of last year's most anticipated video games

was "Cyberpunk 2077,"

a game that cost Polish company CD Projekt

more than $300 million

to develop and market.

Just compare that with Roblox,

which provides a free developer toolkit

for anyone interested in creating content for it.

- Luckily, Roblox has a lot of these pre-made for us,

so we're just gonna go into our toolbox and find one.

- You don't have to be an expert in coding

to make games for Roblox.

There are step-by-step resources

and a lot of it's drag and drop.

Somewhat turnkey you could say.

So that has made it very attractive to younger folks

who are just learning how to do this stuff.

- [Narrator] Roblox says

it's continually updating the toolkit.

This helps developers make engaging content

so its players don't get bored.

- They can make higher-equality games

and the kind of games that adults

would appreciate more so than youngsters.

They're more complicated, they're more challenging.

- [Narrator] This creates an ecosystem

of players and developers.

Just look at Samuel Jordan.

- It felt just really inspiring

to think wow, at a young age, I can make something.

- [Narrator] He first started playing in 2011

and four years later,

he began creating his own worlds, like Fairytale.

- Yay, a new friend.

- [Narrator] Today he's building complex games

for young children

and even took a break from college

during the pandemic to focus on Roblox

with his friends.

Jordan was also hand picked by the company

when he was 19 years old

to help expand the toolkit.

- They've also increased the amount

of textures you can add in game

and it's really helped to really build an atmosphere

for your games.

- [Narrator] Games are free to play on Roblox.

So Jordan only starts to earn money

when a player spends the in-game currency called Robux.

- [Samuel] Earning money on Roblox

is actually a pretty easy process.

People will pay you with Robux

and you can exchange those out for dollars

or your local currency.

- [Narrator] So players can link their accounts

to credit cards and for young children,

they can use prepaid gift cards.

With Robux, they can buy this Prince jacket

or pay for a pass to visit the Dream Mansion.

(pensive music)

Jordan also makes money from collaborations with brands,

turning real-world products

into Roblox items

but he doesn't get to keep all the money.

Developers receive 70%

of the Robux spent in their games

and get 30% of the Robux spent

on items they put up for sale.

Roblox says the rest goes to running the business,

including hosting services and operations.

As players flocked to Roblox during the pandemic,

the company said its revenue last year grew 82%,

while sales of virtual items more than doubled

to about $2 billion.

But user loyalty hasn't translated into profits.

The company has incurred net losses

since its inception in 2004.

And last year, those losses exceeded $250 million,

in part because of higher operating costs.

But profitability isn't the only challenge.

There's been an increasing amount

of adult content on some games.

- All the sort of bad actors you see on social media,

you would have to assume could happen on a site like Roblox.

The only difference is that Roblox happens

to appeal to a very young audience.

Probably youngsters are more sort

to bad actors than adults maybe

and so it raises the bar in terms of moderation.

- [Narrator] Roblox said it hired

more than 2,300 content moderators

while inappropriate words are replaced with hashtags.

The company also said it's now developing

content ratings for games

and making parental controls easier to find and use.

(upbeat music)

But as countries emerge from the pandemic,

Roblox hopes the habits of using the platform

aren't easy to break.

Even Jordan says he'll continue to create.

- I don't think I'm gonna be chasing to keep people on

past the pandemic.

I'm gonna continue to make content

I think players will enjoy

and the ones that stay long

are gonna be there 'cause they enjoy the time they spend.

(lively music)