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Business Operations Business Models

How Does Clubhouse Make Money (Business and Revenue Model)

The Clubhouse app business model

How Does Clubhouse Make Money?
Here’s what you should know:
  • What is Clubhouse, and how does Clubhouse work?
  • How does Clubhouse make money?
  • Tipping Clubhouse Creators (Clubhouse Payments)
  • Clubhouse profit and revenue
  • What is the Clubhouse business and revenue model?
  • Clubhouse funding and valuation
  • Clubhouse Subsidiaries, Acquisitions, and Exits

How does the Clubhouse app make money and how is it free to use? Here is a full, in depth, breakdown of their main revenue stream and services they offer, as well as the Clubhouse business model, their profit and revenue, and how Clubhouse works.

What is Clubhouse, and how does Clubhouse work?

Clubhouse is a social audio app that allows users to join in, listen, and communicate through audio chat rooms that can host up to thousands of people at a time.

Developed and released in 2020 by Paul Davison and Rohan Seth, Clubhouse now has more than 10 million weekly active users on its platform.

So, how does Clubhouse work? To use Clubhouse, users must first download the mobile app on the Apple App Store or Google Play store, and create an account.

Once signed up, users can begin exploring the app by adding topics they are interested in and or following creators that are on the platform. Once they find things they are interested in, they can join different rooms and listen in.

Some of Clubhouse’s competitors include Discord, Twitter, Facebook, Reddit, Telegram, and other platforms that have an audio feature.

Clubhouse App in Apple App Store | Clubhouse Business Model | How Does Clubhouse Make Money? | How Does Clubhouse Work?
Source: Apple App Store | Clubhouse

How does the Clubhouse app make money?

According to reports, Clubhouse currently has more than 10 million weekly active users. So how does Clubhouse (app) make money off of all those users?

Below is a breakdown of how much money the Clubhouse app makes and its revenue model. Including their main revenue stream and how much they charge for their services.

Here is how Clubhouse makes money in 2022

Clubhouse has a revenue model that makes money in just one (1) way; by tipping clubhouse creators.

#1. Tipping Clubhouse Creators (Clubhouse Payments)

At this time, the only money that is switching hands on the Clubhouse app is users have the option to tip Clubhouse creators on the platform. Which goes 100% to the creators and Clubhouse takes nothing.

The way it works is; when users tap “Send Money” and enter in the amount they would like to send, that payment is handled by Clubhouse Payments which uses Stripe as their payment processor. So all users will incur a small processing fee that goes to Stripe and everything else goes to the creators.

According to Clubhouse, “this will be the first of many features that allow creators to get paid directly on Clubhouse.” But as of right now, Clubhouse is funded only by its investors and makes no money.

Tipping Clubhouse Creators | Clubhouse Business Model | How Does Clubhouse Make Money? | How Does Clubhouse Work?
Source: Clubhouse

Note: In the future, Clubhouse plans to “monetize the platform via tips, paid events, subscriptions, and connecting creators with brand partners”, according to the company.

Clubhouse profit and revenue

The Clubhouse app does not make any money at this time.

Note: Because Alpha Exploration Co., Inc. (Clubhouse) is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the Clubhouse business and revenue model?

The Clubhouse app makes money through a few revenue models that they combine within their company, they are:

  • Freemium business model
  • Pay what you want (PWYW) business model

Clubhouse funding and valuation

According to Clubhouse’s Crunchbase profile, Clubhouse has raised $110 million over 5 rounds and received a $4 billion valuation in early 2021, per reports.

Clubhouse Subsidiaries, Acquisitions, and Exits

To date, Clubhouse has not made any acquisitions, investments, or exits.