Business Operations Business Models

How Does Ibotta Make Money (Business and Revenue Model)

The Ibotta business model

How Does Ibotta Make Money?
Here’s what you should know:
  • What is Ibotta, and how does Ibotta work?
  • How does Ibotta make money?
  • Affiliate Commissions
  • Advertising Revenue
  • Account Maintenance Fees
  • What is the Ibotta business and revenue model?
  • Ibotta’s funding and valuation
  • Ibotta’s profit and revenue

How does Ibotta make money if it’s free and they pay you? Well, in this article, we’ll provide a full, in depth, breakdown of their three (3) revenue streams and the different products and services they offer, as well as the Ibotta business model, their year over year revenue, and how Ibotta works.

What is Ibotta, and how does Ibotta work?

Ibotta is a coupon and cashback rewards app that earns customers cashback with every qualifying purchase. It’s available for download in the Apple and Google Play stores as well as a Google Chrome browser extension.

Founded in 2012 by Bryan Leach, Ibotta has since become one of the leading “cashback” coupon apps in the market with more than 35 million app downloads and paying out over $1 billion in cash back to their app users, to date.

Some of iBotta’s competitors include Honey, Groupon, Fetch Rewards, RetailMeNot, Upside, Swagbucks, Rakuten, Dosh, and other coupon deal finders.

How does Ibotta make money?

According to Ibotta’s About page, Ibotta partners with more than 1,500 brands and retailers and has over 35 million app downloads. Ibotta also recently hit a milestone of paying out over $1 billion in cash back to their app users – which means lots and lots of transactions.

Ibotta Facts and Statistics
Source: Ibotta

So, how does Ibotta make money from all those in-app users, partnering retailers, and transactions?

Below we will get into the detail of how Ibotta makes money and its business model. Including all revenue streams and how much they make off each service.

Note: If you google “How does Ibotta make money?” you will find the article of Ibotta talking about how they make their money on their website, but it’s a very vague description.

Here are the 3 ways of how Ibotta makes money (in 2022):

Ibotta has a revenue model that makes money in three (3) ways – affiliate commissions, advertising, and account maintenance fees.

#1. Affiliate Commissions

Since being founded in 2012, Ibotta has had an affiliate commissions business model to generate revenue for the business. Partnering with more than 1,500 brands and retailers, Ibotta earns an affiliate commission for each sale they facilitate through their app.

How it works is: every time a user makes a purchase through Ibotta at a partnering brand or retailer, Ibotta takes an affiliate commission.

Ibotta Partnerships
Source: Ibotta

Note: Ibotta does not disclose how much their affiliate commission is and there are no reliable sources on the web to confirm or fact check it.

[ Related Article: The DuckDuckGo Affiliate Commission Model | How Does DuckDuckGo Make Money? ]

#2. Advertising Revenue

Ibotta also makes money by selling ad placements to advertisers and showing them directly to users on their app.

They offer eight (8) types of ad displays including banner ads, push notifications, newsletters, and more.

Ibotta Business Model | How Does Ibotta Make Money?
Source: Ibotta

Note: It’s unclear how much revenue Ibotta makes off advertising and also how much they charge for ad placements.

#3. Account Maintenance Fees

Ibotta charges a fee on inactive accounts of at least six (6) months. The way Ibotta makes money on this is they draw from the inactive users’ Ibotta account “rewards” balance to cover the fees.

Ibotta Account Maintenance Fees:

  • $3.99 per month until the account balance reaches zero or becomes active.

What is the Ibotta business and revenue model?

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

  • Advertising based business model
  • Commission based business model
  • Fee-for-service (FFS) business model

Ibotta’s funding and valuation

According to Ibotta’s Crunchbase profile, Ibotta has raised $92.9 million over 7 rounds and has a valuation of $1 billion following a round of Series D funding in August 2019.

Ibotta’s profit and revenue

Because Ibotta is a private company, they do not make their financial statements, like Form 10-K, public so we are not able to confirm exact numbers. But from reports, Ibotta reportedly made roughly $98 million in revenue in 2020.