How to monetize a community
Selling membership subscription or ads are not the only options. This is what else you can do to turn a community into a profitable business.
Why did you build a community
Chosing the right business model for the community is based on your answer to the million-dollar question: why did you decide to build it in the first place? There are two reasons why building a community makes sense for a founder:
1. Community as a Product
You want to build a community and monetize it. Instead of building a SaaS, a marketplace or a logo generator, you’ll create a community that people want to pay to join.
In this scenario, building a community is a lot like building any other product:
- validate an idea ⇒ build an MVP ⇒ gather beta users ⇒ iterate ⇒ monetize
Examples include Trends.vc, The Hustle, professional groups like Rotary Clubs, The Masons, even certain religious groups could be considered communities of this type (you join to celebrate your religion together and the organization is funded via member-donations).
2. Community as a Marketing Channel
This scenario doesn’t presume direct monetization. You need members to increase your brand awareness or/and more traffic to your website, but you don’t need to monetize the community directly. The goal of these communities is to send customers to your core product which you will monetize.
Examples: Y-Combinator school (creates brand awareness and power for their venture-arm), Indie Hackers today (maintains brand visibility for Stripe, effectively a permanent advertising deal).
How to monetize a community-as-a-product
Once you figured out what do you need the communty for, you have to choose a business model or a way you’re going to monetize it.The good thing is that you don’t have to choose only one revenue stream. You can build an architecture that includes several streams and opportunities thus making the whole structure more robust, while the…