The new year was barely a minute old when Ukraine’s military forces unleashed a barrage of rockets on a school in the Russian-occupied east of their country. The sunrise revealed a grim scene: at least 89 dead Russian soldiers. Russia’s military blamed the troops for revealing their position with their cell phones. But one Russian pro-war hard-liner told his 295,000 readers the bigger problem was “the banal negligence of the commanders.” Another pro-war Russian blogger sent his 1.3 million followers a video from the wreckage: “The death toll is growing as the rubble is cleared,” he said.
Truth, as the saying goes, is the first casualty of war. Yet the war in Ukraine—one year old on Feb. 24—has brought not so much a mess of unverifiable tales, but a firehose of online information, true and untrue, from both sides. That includes details of the New Year’s attack, one of the deadliest incidents since Russia invaded Ukraine, igniting Europe’s biggest conflict since World War II. Just as striking as the quantity of information is that much of it is being disseminated on a single messaging app, one headquartered thousands of miles from tech giants like Twitter and Meta, and one that only about 20 million Americans use: Telegram.
With the war’s first anniversary approaching, Telegram’s mountain of data now includes close-up videos, battlefield maps, strategy plans, nightly exhortations from Ukraine’s President Volodymyr Zelensky, speeches from Russia’s war planners, grievances from troops over poor planning and supply shortages, and countless photos capturing the conflict’s horrors, from possible war crimes to thousands of loved ones who have gone missing on the front line. Russian use of Telegram soared 66% in the war’s first five months, according to a study by the country’s media research company Mediascope, and Telegram estimates nearly 8% of its users—about 56 million people—are in Russia.
This is a fiercely fought information war. Zelensky’s now-famous videos to his nearly 1 million Telegram subscribers have been crucial in rallying his country’s spirits amid the violence, and in maintaining international support and keeping weapons flowing. For Zelensky’s enemies, Telegram has provided a precious outlet in Russia, where Facebook, Twitter, and virtually all independent media are banned. But Russian Telegram channels (as the accounts are known) backing Putin’s war have also proliferated, with propagandists posting TV-style reports from the front line. Now nine of the top 10 Russian Telegram channels push pro-Kremlin views.
Telegram has been essential in other ways. The information explosion has allowed military officials on both sides to dissect the enemy’s plans and weaknesses, including those of NATO and the U.S. “There has been a ton of real-time open-source intelligence gathering about the war at a scale we have not seen before,” says Justin Sherman, CEO of Global Cyber Strategies, a Washington advisory firm.
Telegram seems tailor-made for a war raging in the social media age, with major global ramifications. Downloadable on both iOS and Android phones as well as computers, it combines the ultra-high-speed messaging of Twitter or Meta’s WhatsApp with Facebook’s broadcasting and publishing capabilities, even with imperfect connectivity in the midst of battle. Its channels can blast text, video, or photos to millions of people within seconds. About 77 million people in Russia and Ukraine downloaded Telegram in 2022. Globally it now has more than 700 million users—about 119 million of them in Russia and Ukraine—and Telegram claims more than 2 million people download the app daily. Last year it was the sixth most downloaded app in the world—well above Facebook and Spotify, according to Boston data intelligence firm Apptopia.
Telegram and its cofounder and CEO, Pavel Durov, have built the platform’s reputation on one core principle: untrammeled free speech. But while speech may be free, running a global tech platform is anything but. Durov estimates operating expenses are “at least a few hundred million a year”—a sum he can no longer fund from his own pocket. Since 2021, he’s raised $1 billion in convertible bonds, added paid subscriptions and advertising, and begun auctioning usernames. Yet those efforts might not add up to lasting profitability for Telegram—and the clock is ticking. Indeed, the very traits that have attracted millions of users to the app—its rejection of marketing algorithms, even its geographic distance from other Big Tech companies—might equally turn off potential investors. “Telegram is a bit fishy, as we don’t know a lot,” says Rocco Strauss, internet equity analyst at Arete Research in London.
In a sense, Telegram’s wartime role is the perfect crystallization of its own history.
Durov, now 38, and his math-whiz brother, Nikolai, 42, launched the app in 2013 from self-exile from their homeland, Russia, after security forces there forced him to sell their previous social media platform, VKontakte, or VK—a Facebook clone—to Kremlin-friendly oligarchs.
With $300 million from the sale stashed in a Swiss bank, Durov left Russia with Nikolai and began building his new venture, Telegram. Among the first subscribers were former VK fans, drawn to Durov’s promise of privacy.
In early 2016, on assignment for Fortune, I met Durov in the penthouse of a London hotel. Days later he would tell the World Mobile Congress in Barcelona that Telegram had hit 100 million users in little more than two years—“only the first milestone,” he told me then. It was a stunning ramp-up, given that Telegram still had no headquarters and was run by a handful of old acquaintances from Russia.
Western officials have accused Durov of allowing terrorist groups on Telegram. “Never in history have authorities had so much information on their hands as they do today, and they still complain about groups ‘going dark,’ ” he told me in 2016. Durov shut 78 accounts linked to the Islamic State (ISIS) terrorist organization after the Paris attacks in November 2015, but did a cleaner sweep of suspected ISIS accounts in 2019 as he courted investors.
In 2018, Russia tried to ban Telegram over Durov’s refusal to share encryption keys, but the platform skirted the crackdown by using “domain fronting” to conceal users’ locations. The government finally opted instead to blast its own propaganda on Telegram, effectively admitting the app had outsmarted its homegrown tech.
Telegram has also built a reputation as a haven for dissidents in places like Iran, Hong Kong, and Belarus, who feel their accounts are shielded from government surveillance. (Sherman believes Telegram is less secure than activists think since it requires users to opt into encryption, and there are reports it has shared data with German police in terrorism and child abuse cases.)
In the U.S., Telegram has offered a sanctuary for former President Donald Trump’s most extremist supporters, including some who attacked the U.S. Capitol on Jan. 6, 2021, and some who were later shut out of Twitter.
But with the Ukraine war, Telegram truly seemed to find its purpose. The app’s installs shot up 89% in Ukraine in the first four weeks of the war, and 17% in Russia, according to data intelligence firm Sensor Tower. The war, Durov said in an anguished post on the app when Russia invaded, “is personal for both me and Telegram,” in part because his mother’s family hails from Kyiv. “I stand with our users, no matter what,” he wrote. “Their right to privacy is sacred, now more than ever.”
The war has inspired dozens of new initiatives, hosted on Telegram. One channel helps identify Russians killed in battle—an attempt to name people whose deaths might otherwise go unmentioned back home, as Putin has downplayed the war’s death toll. The project is run by David Frenkel, a Russian journalist now based in Israel, who also created a Telegram bot where Russian families anonymously share details of those killed. “Even pro-government Russians want to know the cost of the war,” Frenkel says. So far, he has named more than 11,000 dead soldiers, but the real number, likely much higher, might never be known.
There is another enigma too: Pavel Durov.
Since my meetings with Durov in 2016, Telegram’s CEO and cofounder—and its only public face—has grown even more reclusive, retreating from virtually all public appearances and comments for the past few years. That’s a jolting contrast to the unfiltered tweets of another social media chief exec, Elon Musk.
Spare and ascetic, Durov occasionally posts photos of himself on Instagram wading in an infinity pool, or seated in lotus position atop a rooftop in Dubai—where Telegram finally opened its headquarters in 2017—his bare, chiseled chest on display. At times he sports a pendant of an iced ankh wing, the ancient symbol of life.
On his Telegram channel, however, Durov chronicles at length the company’s business decisions to his nearly 800,000 subscribers with surprising candor, detailing his thoughts about privacy, user numbers and growth, and—most crucially—options for generating revenue.
Through the years, Durov’s many thousands of words on his channel offer a sharp look into an executive wrestling with how to make his company profitable, after nearly a decade in business, while still clinging to his initial ideals, like insisting that Telegram will not replicate Meta’s or Twitter’s ad-driven revenue stream, nor use algorithms that monetize users’ data.
One hard truth provides the through line for his long posts: Ideals do not pay the bills. By the time the app hit 500 million users in December 2020, it had grown hugely expensive to run. “More users mean more expenses for traffic and servers,” Durov wrote then.
Even with more than 700 million users now, Telegram still operates in an astonishingly homespun way, with “an agile core team of around 60” in Dubai, spokesman Remi Vaughn tells me on the app’s press bot. Meta’s global staff, by contrast, is around 80,000.
For investors, Telegram’s tiny size is not necessarily an advantage. Unlike Meta’s Facebook or WhatsApp, Telegram “does not receive cross financial from other parts of any group,” says Strauss, the equity analyst. What’s more, he says, Meta’s Messenger and WhatsApp have tens of thousands of content moderators, making for “a much safer environment” compared with Telegram, which conducts minimal scrutiny of users.
Despite Telegram’s lean operation, Durov insists he’ll never sell it. “The world needs Telegram to stay independent … as an example of a tech company that strives for perfect and integrity,” he wrote two years ago. “That is impossible if you become part of a corporation.”
But Durov has already witnessed the collapse of one of his biggest profit-making schemes: Telegram’s first stab at cryptocurrency. Launched in 2019, Telegram Online Network, or TON, aimed to offer a range of decentralized services that users could pay for with its own digital currency, called Grams. Telegram initially raised $1.7 billion on TON, but it ceased trading Grams after the U.S. Securities and Exchange Commission sued the company for selling unregistered securities in 2019. Seven months later, the SEC clawed back $1.2 billion and fined Telegram $18.5 million.
With his crypto idea ruled out, Durov has raced to fund the company in other ways. In 2021 he raised more than $1 billion by issuing five-year pre-IPO convertible bonds, maturing in March 2026. Of that, $150 million worth were sold to two United Arab Emirates venture capital firms, and the rest to “some of the largest and most knowledgeable investors from all over the world”—none of whom Durov named.
After years of vilifying Big Tech’s ad-driven models as exploiting users, Durov has finally been forced to compromise. Last July he launched Telegram Premium. Subscribers pay about $5 a month, depending on location, for faster download speeds, bigger uploads, stickers, and no ads. Telegram channels that broadcast to large audiences can now buy advertising, though ads must be relevant to that channel, and they remain hidden on regular Telegram messages. Telegram insists “no user data is mined” from the ads. Now—much like Facebook—“ads currently make up the majority of Telegram’s revenue,” according to Vaughn. While not sharing figures, he says ad revenues are “outperforming the market by a significant margin.”
Last October, Telegram rolled out an auction platform called Fragment, enabling users to buy and sell usernames using the app’s latest cryptocurrency, Toncoin. The username @news was auctioned for 994,000 Toncoin, worth nearly $2.3 million. The platform raised about $50 million in the first month, according to Durov. “Results have already exceeded our expectations,” he wrote in December.
The next step, he wrote after the FTX collapse last November, is for Telegram to create decentralized exchanges for users to trade and store cryptocurrencies, and to host discussion groups, where thousands of people can converse on various subjects in online rooms. “Other apps consider their users a tool to maximize revenues,” he said. “We consider revenues a tool to maximize value for our users.”
Such high-mindedness could wear thin if Telegram fails to become profitable after nearly a decade of losses. In January came a new challenge, when Russia announced it intends to limit the way sanctioned banks use Telegram as a payment platform. Still, Vaughn insists the company “is about to enter the most exciting period of its growth.” But it is unclear whether the ad revenues and projected crypto earnings exceed the “few hundred million a year” that Durov estimated Telegram needed “to keep going” back in 2020.
The stakes for Telegram’s survival are high: Its disappearance would halt—or even let vanish—the deep real-time chronicle of Europe’s biggest war in generations, as well as a reliable bullhorn for activists and propagandists the world over.
Collapse is not impossible, however. Durov faces a far more crowded field than Telegram’s early days a decade ago. “Competition is broad,” says Strauss. He rattles off a list of 10 social media platforms, such as WhatsApp, TikTok, Discord, and others, and ends with “et cetera.”
Durov’s task now is transforming his huge user base, and his idealism, into lasting profitability that can endure long after the rockets fall silent and peace returns to Europe.—With Anna Shpakova
This article appears in the February/March 2023 issue of Fortune with the headline, “A wartime bullhorn, an iffy business.”
Learn how to navigate and strengthen trust in your business with The Trust Factor, a weekly newsletter examining what leaders need to succeed. Sign up here.