A lot of Mastodon servers are run like that. It generally works if you run a instance as a community and not a catch-all general purpose one as then you will have a smaller dedicated group of members willing to subsidize the un-avoidable lurkers and free-loaders. This is like those "Free2Play" games that are massively profitable despite having no ads and are free to download if you want think about it in capitalist terms.

In the end it isn't terribly expensive to run a Lemmy instance or any online service. Facebook and the other ad companies spend most of their revenue on user tracking and advertisement infrastructure which is super wasteful as it is just done to attract more advertisers... basically a snake eating its own tail.

I think Reddit gold was a brilliant way to support the platform and get something in return. I’ve been thinking of supporting various FOSS projects, but getting nothing but a a warm and fuzzy feeling in return just feels inadequate. Getting a Debian/Inkscape/Firefox hoodie sounds much more appealing to me, so recently I’ve been lookin for those sorts of donation options.