Consumer interest in open source, decentralized social networking isn’t something that was only reflected in news headlines over the past year, it’s also apparent in the financials behind Mastodon. The nonprofit organization powers one of the many apps that came into fashion as a Twitter alternative following Elon Musk’s acquisition of the social network he’s since renamed X. According to Mastodon’s annual report, released today, the company says it’s seen a 488% increase in donations, totaling €325.9K, or roughly $341,985 in U.S. dollars.
That’s up from just €55.6K in its fiscal year 2021, though still a much smaller amount compared with the funds pouring into other would-be Twitter rivals like Bluesky, Pebble or Spill. Bluesky, for instance, announced a seed round of $8 million this June, while Pebble (formerly T2) raised over a million from angel investors, and Spill raised a $2.75 million pre-seed round.
But unlike investor-backed startups, Mastodon operates as a nonprofit supported by user donations, primarily from Patreon. That supporter base also grew last year to 9,603, up 1,614% from the 560 donors it had at year-end 2021. From its own custom sponsorship portal, it also has an additional 53 subscriptions, up from 20 last year.
What’s telling is that the biggest jumps in Mastodon support came immediately following Elon Musk’s Twitter acquisition, which closed in October.
As Mastodon’s report notes, the number of donors on Patreon grew from 1,428 in September to 7,962 in October — that’s a 6x increase. And the number of donors via Stripe increased from 19 to 44. But this, in turn, meant the average annual donation decreased to roughly $35.70 USD, due to an increase in the number of donors who contributed smaller amounts.
The funds were used to support the operating costs of running Mastodon (€127.1K / $133.5K USD), personnel expenses (€79.7K / $83.7K USD) and other miscellaneous expenses (€6.4K / $6.72K USD), the report says.
In addition, Mastodon founder Eugen Rochko benefitted from an open source fund financed by the German Federal Ministry of Education and Research and the German Open Knowledge Foundation, which contributed €18.6K ($19.5K USD). NLnet, a nonprofit foundation that supports open source development of internet technologies, also contributed €42.8K ($44.95K USD).
The full report also goes into detail about Mastodon’s development over the course of the year, which included a branding update with more vibrant shades of purple, and other web and mobile software updates, redesigns, improvements to its moderation system and support, and more.
Over the course of 2022, the two servers Mastodon itself operates — Mastodon.social and Mastodon.online — gained 486,000 new users and processed 15,237 moderation reports; 5,920 of those resulted in the suspension of an account. And, in total, 66,637 accounts were suspended this past year.
Image Credits: Mastodon
Given Mastodon’s growth, the company aims to set up a U.S. nonprofit branch (501(c)(3)) this year with a board of governors so it can become eligible for larger grants from U.S.-based donors and allow donors to make their donations tax-deductible.
It’s also planning further merchandise efforts, which began with the sales of stickers, tees, mugs and pins earlier this year. The report didn’t break out how much revenue those merch sales produced, however.
In addition, the company will continue to work to make Mastodon more user-friendly, the report says. The company recently made good on those efforts with the release of version 4.2, which was a significant update designed to make the service easier to use — particularly for newcomers.
Mastodon also plans to improve moderation tooling for server operators to address spam and abuse issues. That issue had come to light this year, as well, as Mastodon’s software — which anyone can run on their own servers — was found to be hosting child sexual abuse material (CSAM). In one case, the server operator explained that they could only manage moderation in their spare time — and they were only one person, not a team as you’d have at Meta — so removals could take days.
Image Credits: Mastodon
As for Mastodon’s growth — which speaks to its potential impact on X as former users flee the platform looking for alternatives — the network grew from 2,527 servers, totaling 2.7 million registered and 294,000 monthly active users at the end of 2021 to 9,686 servers, totaling 5.8 million registered users and 1.8 million monthly active users.
On its own two servers, Mastodon had 117,000 active accounts by year-end, representing a roughly 37% retention rate.
Of course, as we’ve seen, Mastodon’s user metrics wax and wane at times with Musk’s pronouncements about new X policies and changes. For example, TechCrunch noted that as X underwent its rebranding, Mastodon’s monthly active users had reached 2.1 million, only slightly short of last year’s peak of 2.5 million when Musk bought the social network. Currently, the network reports 1.7 million monthly active users.