Our Plan for a Sustainably Open Social Network
July 5, 2023
by The Bluesky Team
Bluesky is a public benefit corporation with the mission to “to develop and drive large-scale adoption of technologies for open and decentralized public conversation.” The public benefit corporation status allows us to pursue our mission above profit, but we still need to make Bluesky a sustainable service in order to build an open ecosystem that lasts. In order to do this, we’ve raised an $8M seed round to support our mission and growth, and are taking the first steps towards a services-led business model.
Our Seed Round
The hardest part of building a new social network is bootstrapping growth. As you might recall, Bluesky started as a project funded and supported by Twitter, and even after our incorporation as a separate company, we retained a close relationship with them. However, once Twitter changed hands, the relationship was terminated, and our original plan of building the AT Protocol to support Twitter as a client was no longer possible.
Last fall, we started building our own client app to drive adoption and development of the AT Protocol. This summer, we converted from a public benefit LLC to a public benefit C Corp in order to gain more independence from the legacy of the past. Our mission and board have stayed the same, but along with this conversion, we’ve raised funding from an array of values-aligned investors who share our vision for an open and decentralized commons for public conversation. Our goal for this raise was to find new partners and to give ourselves room to grow the network and experiment with new business models.
We raised $8M in a seed round led by Neo, a community-led firm with amazing partners like Ali Partovi and Suzanne Xie, and a wonderful cast of additional investors including Joe Beda who co-created Kubernetes, Bob Young of Red Hat, Amjad Masad of Replit, Amir Shevat of Darkmode, Heather Meeker, Mana Industries, Automattic, Protocol Labs, Katelyn Donnelly, Ali Evans, Stav Erez, Kris Nóva, Brad Fitzpatrick, Abdul Ly, and many other operators who have much wisdom to share.
With this funding, we can expand our team, manage increasing operation and infrastructure costs, and grow the AT Protocol ecosystem as well as the Bluesky app. It’s a lot to tackle at once, but we’re excited to have seasoned allies who want to help us realize our vision of an open commons for public conversation.
Just as we’ve made the source code for the protocol and the client public, we also want to be transparent about our business plans. We’ll be experimenting with different strategies and services to see what provides real value to our users, and will continue to share what we learn as we build a sustainable social network.
Our First Paid Service
Traditionally, social media companies have supported business costs through advertising. While advertising can subsidize services to make them free to the end user, it comes with negative long-term consequences like incentivizing platforms to lock their users in. In the business of advertising, where social media companies exchange user data to serve ads to specific audiences, users become the product.
Bluesky’s business model must be fundamentally different — we are a public social network and our code is all open source, so we have no “moat” when it comes to data. We set out to build a protocol where users can own their data and always have the freedom to leave, and this approach means that advertising couldn’t be our dominant business model. So, we’ve been exploring other avenues of monetization.
We believe that there must be better strategies to sustain social networks that don’t require selling user data for ads. Our first step in another direction is paid services, and we’re starting with custom domains. While setting up a custom domain to use with Bluesky and the AT Protocol is fairly straightforward, it does require some familiarity with domain registrars and DNS settings. Yet, over 13,000 users have already either repurposed domains they already owned to use as handles, or purchased a domain solely because of Bluesky. Domains have so much potential as a personalized way to customize identities and as a decentralized way to verify reputation that builds off the existing web. For example, U.S. Senators have used the senate.gov domain to verify their identity on Bluesky without our involvement, and a third-party developer built a web extension that checks if websites are linked to an AT Protocol identity. The possibilities are wide in the domain-as-a-handle space.
We’re partnering with Namecheap, a popular domain registrar, to offer a service for easy domain purchasing and management. With this, people can set a custom domain as their handle on Bluesky and the AT Protocol in under a few minutes. Of the domain registrars, Namecheap has one of the best reputations for defending their users against unauthorized domain transfers and protecting their domain names. Our shared values of putting users first and moving towards a more open internet makes us confident that together, we can provide a great service to our users. To learn more about how to easily get your own custom domain through Bluesky, read our product announcement here.
