Github Business Model – How does GitHub make money

Have you ever heard of Github? If you’re a tech geek then there are chances that you must have already known about. However, if you don’t know what it is, no worries. Read on till the end you will know all the information relating to it.

So without any further ado, let’s jump straight to the topic. You must understand what is Git first to understand Github. Git was created by Linus Torvalds, who has previously created Linux. It is an open-source version control system. Especially it is a distributed version control system. Simply put, the entire history and codebase are available in the developer’s computer making it easy for merging and branching.

So as you have understood about Git. Let’s talk about the other principle in Github i.e., version control. It helps the developers manage and track the changes to code. As the project grows more version control becomes essential. Since you have understood the two principles of Github. Now you must have understood what is Github? It is a cloud-based service and website where developers can manage their code, store, track and also control the changes of their code. 

In this article, you will not be knowing about the technical aspects of Github. Our focus will mainly be on the financial aspects of the GitHub.

Github 

As you already know that Github is a company that offers a cloud-based Git repository hosting services. The interface is userfriendly. You can use Git on your server or locally that you usually share with your team. But it also brings you a lot of expenses such as access privilege, maintenance of servers, etc. This is where Github comes into the picture, it provides all the core functionalities of Git i.e., advanced merging, and branching provisions, DVCS, anyone’s body can work on any repository without depending on the central server. It also providers developers with a staging area to run particular snippets of code. 

Simply put, Github has become a developer’s cloud storage where they can share, discover codes, and easily collaborate with other users on the platform. So now coming to Github it was started back in 2006 by Tom Preston-Werner, PJ Hyett, and Chris Wanstrath. The main reason behind Github’s popularity is its most powerful interface with many useful features that will help the developers and most importantly it is an ad-free interface. So with all these amazing features and functionalities, it is not astonishing that most of the developers have naturally started using this platform.

GitHub is also a freemium model. Freemium models are a mix of both free and premium plans. Yup, you heard it right. Some services offered by Github are free, while for some other amazing features you must pay money. 

GitHub business model 

In this platform, you can create unlimited repositories be it public or private for free. However, if you want other additional features such as more storage, bandwidth, organizing tools, and other customizations then you must pay for them. As now that you have an idea about the business model. It is time to understand the key partners of Github.

Developers and IT industry 

As you see this platform is related to coding and makes it easy for the developers to share and discover codes and share with other users on the platform. So the major users of Github are the IT industry or the developers. All the major technology companies host their projects on this platform.

Community (Open source)

Another major component of the Github services is the open-source community. As you see one of the two principles of Github is open source i.e., Git. The open-source projects on this platform have a lot of contributors. Not only for the open projects, but these contributors are also the major source for other repositories.

As of now, you have a clear view of the major users and what is Github aren’t you curious to know how does Github makes money?

Yes, then let’s jump straight to the topic. 

How does GitHub make money?

Now is the time to discuss the money-making process. One of the major sources of income for Github is subscription plans. Yup this is one of the major sources of income for many platforms. 

Subscription plans 

Like all the businesses that follow the freemium model Github also has subscription plans. The features offered change from plan to plan. So choose a plan that matches your requirements. More people choose these plans if they are looking for more amazing features that cannot be offered by the free plan. So Github offers three subscription plans apart from the free plan they are Team, Enterprise, Github One. The Free plan is suitable for developers and teams. The team plan is suitable for teams’ advanced collaborations and support. Enterprise is suitable for enterprise security, flexible deployment, and compliance. Github One includes all the best tools, services, and support of Github. Among all the subscription plans offered by Github, the enterprise plan brings in more revenue. 

Free

Team- $4/month/user

Enterprise- $21/month/user

GitHub One- contact their team to know the price

Marketplace

Another source of income for Github is their marketplace. This is a place where the users can search, download, or purchase applications. Not only that they can also upload/share their applications. Sounds cool, right? The users will be able to find tools that will help them in finding the right tools that will help them in improving their workflow. For every sale made on the market place, Github takes around 25% of the sale. 

Investments

This is another type of income source for business is investments and this company has also received investments. Github was acquired by Microsoft in 2018 for $7.5 Billion. It has received total funding of $350 Million. To date, it has received 2 investments. The last funding type of Github is the secondary market.

Merchandise 

This source of revenue is truly creative. They also have a Github shop where they sell their merchandise. From hoodies to houseware, collectibles they sell a lot of items bringing in good revenue. The merchandise also adds up to its revenue stream. 

Wrapping up

The business model of Github is quite simple and straight forward. It has a clean interface where it provides people with hosting services for Git. All the major technology companies list their projects on this open-source platform. The users can share, store, discover codes on this platform. It has provided developers with a platform to showcase their expertise. This platform has truly become one of the most used software development platforms. Check out our other business model articles to find out more about companies.

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