Bluesky just hit 26.4 million users, is raising at a $700 million valuation, and generates exactly zero dollars in revenue. This isn’t a bug—it’s the feature. After watching 116,000 users flee X in a single day post-election, Bluesky gained 1 million users daily for five straight days. The platform that Twitter founder Jack Dorsey started as a decentralized dream has become the refuge for everyone exhausted by Elon’s chaos. But here’s the paradox: with $23 million raised and burning ~$1 million monthly, Bluesky is attempting something that killed every Twitter competitor before it—building a sustainable business model for social media without destroying what users actually want. The 2025 monetization plan reads like a “what not to do” guide from Web 2.0, and that might be exactly why it works. (Source: Business of Apps, January 2025; TechCrunch, November 2024)
Funding raised: $23 million total (Source: Crunchbase)
– Seed: $8 million – Series A: $15 million (October 2024, led by Blockchain Capital)
Target valuation: ~$700 million (Source: eMarketer, 2024)
Estimated burn rate: ~$1M/month (Based on 100-person team)
Strategic Analysis: The Anti-Twitter Playbook
Why Zero Revenue is Strategic (For Now)
From a strategic perspective, Bluesky’s no-revenue model serves four critical purposes:
Trust Building: After watching Twitter monetization destroy user experience, staying revenue-free builds credibility
Growth Priority: Every failed Twitter competitor (App.net, Ello, Mastodon mainstream) monetized too early
Differentiation: Being the anti-X in every way, including businessmodel
Time Buying: With $23M raised, they have 18-24 months runway to figure it out
The Monetization Tightrope
2025 Revenue Plans:
What They Will Do:
Custom domains via Namecheap partnership (Source: Company blog, 2023)
Premium subscriptions for non-core features (Source: CEO statements, 2024)
– Higher quality video uploads – Profile customizations – Avatar frames and colors
Creator payment systems (Source: October 2024 announcement)
Voluntary support mechanisms
What They Won’t Do (Initially):
Paywall core features (posting, bookmarks, basic functions)
Traditional display advertising
Sell user data
Algorithmic timeline manipulation
Recent Shift: Despite previous aversion, CEO Jay Graber said they’re not ruling out “non-intrusive ad formats” (Source: Post-growth interviews, late 2024)
The Competitive Landscape
The X Exodus Numbers
November 6, 2024: The day after the election:
116,000 X users deactivated accounts (Source: Internal data)
Largest single-day drop since Musk acquisition
Bluesky gained 1M+ users in following days
Who’s Moving:
Major media organizations (Guardian stopped posting on X entirely)
Bluesky’s business model is a fascinating paradox: build massive value by explicitly not pursuing traditional value extraction. With 26.4 million users, zero revenue, and a $700 million valuation target, they’re betting that the playbook that killed Twitter—ads everywhere, engagement manipulation, user hostility—has created space for its opposite.
The Strategic Reality: In a world where every social platform becomes an advertising nightmare, being the anti-platform might be the most valuable position. Bluesky doesn’t need to be Twitter-sized to win; at 50-100M engaged users willing to pay for a clean experience, it’s a multi-billion dollar business. The question isn’t whether they can make money—Discord proved the model works. It’s whether they can resist the siren song of advertising long enough to build something sustainable.
For Business Leaders: Bluesky teaches us that sometimes the best business model is patience. By watching Twitter’s enshittification spiral, they learned what not to do. By staying revenue-free during hypergrowth, they’re building trust that money can’t buy. The lesson? In markets destroyed by extraction, creation wins. In ecosystems poisoned by ads, subscriptions thrive. And sometimes, zero revenue at 26 million users is worth more than $1 billion at 300 million.
Three Key Insights:
Anti-Strategy Works: Being everything your competitor isn’t can be a winning position
Patience Pays: Building trust before monetization creates pricing power
Strategic Analysis Framework Applied
The Business Engineer | FourWeekMBA
Disclaimer: This analysis is for educational and strategic understanding purposes only. It is not financial advice, investment guidance, or a recommendation to buy or sell any securities. All data points are sourced from public reports and may be subject to change. Readers should conduct their own research and consult with qualified professionals before making any business or investment decisions.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
