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How Does Pinterest Make Money (Business and Revenue Model)

The Pinterest business model

How Does Pinterest Make Money?
Here’s what you should know:
  • What is Pinterest, and how does Pinterest work?
  • How does Pinterest make money?
  • Advertising
  • Other Income (Interest Earned)
  • Pinterest’s Subsidiaries, Acquisitions, and Exits
  • Pinterest’s profit and revenue
  • What is the Pinterest business and revenue model?
  • Pinterest’s funding and market cap

How does Pinterest make money if it’s free? Here is a full, in-depth, breakdown of their two (2) revenue streams and the different products and services they offer, as well as the Pinterest business model, their year-over-year revenue, and how Pinterest works.

What is Pinterest, and how does Pinterest work?

Pinterest is a social media platform that allows you to create, discover, and save customized “boards” using images, GIFs, and videos shared by other users.

How Pinterest works is: Once a user creates a profile, they can create or save “pins” to created and saved boards. As well as follow other users on the platform.

Founded in 2009 by Ben SilbermannPaul Sciarra, and Evan Sharp, Pinterest has gone on to attract more than 478 million monthly active users worldwide and a market cap of $45.44 billion as of July 2021.

Some of Pinterest’s competitors include Facebook, Instagram, Twitter, Snapchat, LinkedIn, and other social media platforms.

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

How does Pinterest make money?

Some of Pinterest’s statistics include having over 478 million monthly active users and more than 1.5 million active advertisers using their Pinterest platform.

So how does Pinterest make money off of all those users and advertisers?

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

Here are the 2 ways of how Pinterest makes money (in 2021):

Pinterest has a revenue model that makes money in two (2) ways – advertising and other income.

#1. Advertising

Pinterest makes money through advertising by serving ads on their website and mobile app. In fact, $1.39 billion or 82.2% of Pinterest’s total revenue of $1.69 billion came from advertising in 2020.

To date, there are more than 1.5 million active advertisers and over 478 million monthly active users on the platform to advertise to.

How advertising on Pinterest works is: Once an advertiser creates a Pinterest business account, they can then create a Promoted Pin campaign to fill out the campaign’s objective, daily budget, set up the target demographic, and what they’re looking to advertise.

These ads are then displayed in the form of “promoted pins” that show up as regular pins on a user’s page. And depending on the budget they set and other factors, they will receive clicks and impressions on their ads.

Pinterest Advertising | How Does Pinterest Make Money?
Source: Pinterest

Note: 82.2% of Pinterest’s total revenue came from advertising in 2020.

#2. Other Income (Interest Earned)

Although the majority of Pinterest’s revenue is generated through advertising, they also make money on interest earned.

“Other income” as described on page 57 of Pinterest’s 2020 Form-10K, “consists primarily of interest earned on our cash equivalents and marketable securities.”

Pinterest’s Subsidiaries, Acquisitions, and Exits

To date, Pinterest Inc. has made a total of 16 acquisitions.

Pinterest Acquisitions
Source: Crunchbase

Pinterest’s profit and revenue

In 2020, Pinterest made $1.69 billion in revenue.

Note: Because Pinterest Inc. is a publicly traded company, under the Securities Exchange Act of 1934, they must file continuous financial filings with the U.S. Securities and Exchange Commission (SEC). You can find all of Pinterest’s publicly released financial reports, including annual reports, through Pinterest’s investor section on their website.

What is the Pinterest business and revenue model?

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

  • Advertising based business model
  • Interest revenue model
  • Mergers & acquisitions (M&A) business model
  • B2B2C (partnerships) business model

Pinterest’s funding and market cap

According to Pinterest’s Crunchbase profile, Pinterest’s raised $1.5 billion over 23 rounds with a market cap of $45.44 billion as of July 2021.