Quora is one of the most popular and well-known question/answer based websites on the Internet, with a simple interface and engaging content. It has garnered immense popularity over the years and is also among the most visited websites in the world.
But how does Quora make money? Quora make money by selling ad space on its website and mobile app, charging fees for Quora+ subscriptions, taking 5% commission on Quora Spaces subscriptions.
If you’ve ever had a question, such as “How often should I brush my teeth” or “Why is my car making this noise?” then chances are, you probably visited Quora in search of an answer. Any time questions like the above are entered into a search engine, Quora is always among the leading results.
Quora is similar to Yahoo! Answers, but it is based on a much more sophisticated algorithm that ranks answers and sorts them according to subject matter, even if they are not factually correct.
Even though Quora is a private company, there is still lots of useful data that reveals what kind of direction the company is headed in. Let’s break down the specifics and see how this business was built around monetization.
Business Model Of Quora
Quora has an ad-based business model along with subscriptions and the majority of their revenues come from the ad-based model. There is room for further monetization as well.
Quora shares some common traits of other popular social sites: it has a large user base, an egalitarian and open environment, and promotes interaction. The unique twist is that it compensates knowledgeable and friendly users with cash. Due to its high engagement rate, Quora’s business model is a huge factor in its success, whereas on more traditional social platforms such as Facebook and Twitter the reward for participating is almost entirely psychological.
Quora receives more than 330 million visitors each month with a relatively simple business model. In the section below, you’ll find out how Quora came to be what it is today and how it generates such an expansive viewership.
A Social Media Platform For All Your Questions
Quora certainly does fall under the umbrella of what is considered a social media platform. If you go to the site, you’ll find a fledgling community of experts sharing their knowledge with interested parties. Of course, there are plenty of other platforms where this type of exchange of information happens.
Yet, Quora sees more than 330 million visitors per month. Here’s why:
- Quora’s SEO (search engine optimization) makes the website a leading search engine result for a wide variety of topics.
- Just about anyone can register to answer questions.
- Answers are vetted through a voting process. The more “likes” any answer has, the more reliable it is.
- The highest-voted answer is automatically chosen as the best answer.
It’s hard not to like what Quora has to offer. Whether you’re looking to find answers or simply want to explore new topics, their platform will come in handy. And with the other recent additions, such as groups and collections, Quora is now an even more compelling option for anyone who wants to take their personal learning even further.
Billion Dollar Social Media Startup
Quora was first launched in 2009, taking 9 months to develop into a rudimentary version of what it is today. The initial visitors were employees who then invited friends to use a site where they can ask and answer questions.
Several pivotal moments in the young company’s history have contributed to its current valuation:
- 2014: Quora joins forces with a startup accelerator Y Combinator, leading to a funding campaign of $226 million.
- 2016: Quora purchases political discussion forum Parlio, which provides Quora with a viewership base seeking unbiased reporting on current events.
- 2018: Quora Spaces is launched. This allows users to create their distinct communities. (Akin to Reddit and subreddits).
- 2021: Creators on the platform can now earn money from their contributions in a process that will be discussed in further detail below.
A Community-Based Exchange Of Knowledge
Quora first unveiled Spaces in 2018, a way for visitors of the site to form communities of like-minded individuals to form. Spaces are akin to blogs and can be accessed easily from the home page that users see first when they login to their account.
- Spaces can be accessed with ease on the mobile app, by navigating to an icon shown at the bottom menu bar.
- Any topic you can think of probably already has a Space on Quora.
- More than 400,000 different topics are discussed on Quora.
There is no charge for visitors to search for Spaces, but an increasing amount of content has been put behind a paywall. Quora does generate revenue from this, as will be revealed below.
How Does Quora Make Money?
The revenue streams for Quora have pretty much been limited to its status as an online billboard. Learn here about how the company is branching out with new and creative revenue streams.
The majority of Quora’s revenue comes from online advertising. A more technical discussion of how this works is included in the subsection below. The platform is also branching out by allowing creators to place a paywall in front of each (or at least some) of posts. Quora collects a small commission from the money that subscribers pay to view premium posts.
The company is also finding new and unique ways to generate clicks. Among these is the opportunity for registered users to monetize their accounts. Quora takes a small commission from monetized counts, a practice that will be analyzed in further detail below.
Quora For Business is an online advertising service provided by Quora. The appeal of this service is that a significant number of visitors visit a Quora page before making a major purchase.
Internal data shows that 63% of Quora users are actively-engaged in online research that may eventually lead to a major purchase. User data also shows that 47% of registered visitors report a household income exceeding $100k per year.
How Does Advertising Work On Quora?
Companies advertising on Quora are presented with several ways to customize the scope of their ad campaign. They can set a budget, choose which ad to show, and add a payment to their account.
A live auction system is used to determine which ads go where. There are a couple of bidding options for companies participating in Quora for business:
- Cost per Click: Minimum bid $0.01
- Cost per Impression: Minimum bid $0.20
Quora’s users can see ads on their home page, right rail, next to answers on their Quora feed and near question pages. Ads are targeted to a user’s interests and may be served based on a user’s location.
Quora has built its own algorithms for relevance that work better than other ad platforms that rely on off-the-shelf solutions like Google AdWords or Facebook’s Audience Network. In other words, Quora doesn’t just take the first ad from the highest bidder; it makes sure that the content of an ad is relevant to the page
The company has recently introduced a new subscription service that will allow users to monetize their accounts. The package comes with unlimited access to all questions and answers and could become a big revenue boon for Quora.
|Subscription Service||Cost||Summary of Features|
|Quora+||$5/month or $50/year||Unlimited access to all questions and answers, Users can follow creators and experts they like.|
Where does subscriber money go? Funds from subscribers are pooled together. Quora then distributes this money to each creator. The earnings of each creator depend on the number of views and likes they are receiving.
Creators have the option to enable dynamic paywall systems or adaptive paywall systems on their accounts. Here’s the difference between the two:
- Dynamic paywall systems: creators are allowed to give free users access to their posts.
- Adaptive paywall systems: some content that a creator makes will be free to users while other content will be behind a paywall. A special algorithm determines whether an answer is freely-accessible or not.
Quora will determine which percentage of earnings it will take from creators who have monetized their accounts. It’s worth noting that leading competitors, such as Ghost, allow creators to take home 100% of their earnings from viewership.
Quora Spaces Subscriptions
Quora has an interesting feature called Spaces, which allows users to create mini publications within Quora. There are already several “Spaces” up and running that have become popular on the platform.
Each space is run by one or more people who can choose whether or not they want to charge readers to access their content. The creators of these spaces will set their own subscription fees and then Quora takes a 5% cut of whatever price they choose to charge.
Quora Digest is a service that users automatically opt-in to when they register an account on Quora. The service directs traffic to the website by sending email notifications of threads covering topics users may find interesting.
Subscribers can turn this service off completely or change the frequency with which they receive such alerts. Although the service is free, it does generate ad revenue for Quora by making users aware of threads without having to visit the site.
Quora Funding, Valuation & Revenue
The valuation of Quora has risen quite sharply over the last 8 years, thanks to several rounds of funding from venture capitalists. Since then, the social media platform has made one major purchase and added new services.
Since Quora is a private company, it can be hard to find reliable data on its valuation, revenue, and expenses. Even so, in the section below you’ll find a clear picture of the direction that Quora is heading.
Why Is Quora Not Publicly-Traded?
No, as of 2021 Quora is not publicly-traded. The company has not demonstrated any plans to participate in an initial public offering (IPO). For those unfamiliar, an IPO is a process in which a private company (such as Quora) begins to offer shares of company ownership to the public.
An IPO is often seen as an exit strategy for founders and private investors:
- Private companies often go public when their valuation exceeds $1 billion (Note Quora’s current valuation of $2 billion).
- If Quora goes public, they must be ready to comply with the stringent standards of the Securities Exchange Commission (SEC).
- This means that they will need to provide investors with reports of assets, liabilities, expenses, and revenue.
All of Quora’s seed funding has come from venture capitalists. These are wealthy individuals who invest in a company in anticipation of rapid growth.
Valuation and Revenue
As was mentioned before, Quora receives most of its revenue through advertising. The market valuation of the company in 2018 was $2 billion. Quora reported $20 million in revenue the same year. Since then, those numbers have risen significantly, on a year-by-year basis.
What Are Quora’s Expenses?
Since Quora is not a publicly-shared company, it does not have to itemize or report its expenses in the same way that a public corporation does. However, much can be inferred based on the expenses of other social media companies.
Leading operating expenses for companies such as Quora include:
- Salaries and benefits to employees. Estimates vary, but Quora seems to directly employ a staff of 100-300.
- Cyber security is always a hot topic and a major undertaking. Facebook claims to have spent $13 billion on cyber security since 2016.
- App development is always going to be a leading expense for a company like Quora who is branching out to include more services, such as Quora+.
How Many Users Does Quora Have?
It’s safe to say that millions of new users have discovered Qura over the last several years. Quora currently reports more than 300 million monthly active users. For reference, Twitter claims 199 million daily users and about 330 million monthly.
Who uses Quora?
- 57% of Quora’s users self-identify as being male.
- 75% of visitors use their cell phones to navigate Quora.
- 25-34 years old: 32.5% of Quora’s users fall within this age bracket.
- Thousands of advertisers have utilized Quora For Business.
Quora’s greatest advantage is the fact that it attracts so many elite users who know how to conduct themselves well on this platform. They are able to provide detailed and courteous answers quickly, which is an important consideration when you are asking serious questions.
How Quora Appeals To Younger Generations?
It shouldn’t come as a surprise that Millenials and Gen Z love their phone apps. Studies have shown that 99% of Gen Zers use a mobile banking app. Combine this with the fact that 75% of Quora visitors do so on their cell phone,
The usefulness of its mobile app could be critical to the company’s future. The good news is that Quora does indeed have an app available on both Google Play and iOS.
The Quora app is convenient and easy to use:
- 4 ways to sign in: Through Google, Apple, Facebook, or a Quora account.
- The ability to monetize your account with your fingertips.
- Full customization regarding which content you see in your feed.
- Direct messaging with any Quora user.
It’s easy to see that Quora is developing an experience that is similar to what is seen with other leading social media apps, such as Facebook, Instagram & Twitter.
Who Are Quora’s Leading Competitors?
The social media sphere is quite crowded and simple question-answer websites like Quora are certainly not an exception. Since advertising is such a big part of revenue, Quora must maintain a high level of traffic.
You may recall websites such as Yahoo Answers and Ask Jeeves in the past. Quora successfully outlasted these competitors in the early days of the internet.
Leading competitors include:
- Any website or platform where you can ask and answer questions.
Is Quora Profitable?
Quora is a for-profit company that has a profitable business model with a strong underlying growth engine. In 2018, it generated $8 million in revenue and had over 300 million unique monthly visitors.
Its growth is fueled by an engaged community of users that are knowledgeable about their topics of expertise, and who answer each other’s questions, helping one another with insight and knowledge.
Since 2014, the valuation of Quora has risen sharply from $400 million to over $2 billion. Quora also has reported approximately $20 million in revenue annually.
Here are some more promising statistics: Quora reports up to 330 million viewers per month. The company also now allows users to put a paywall in front of their content. A subscription service is offered to users who want to access all content.
With the switch, the company’s profitability now partially depends on whether its customer base is willing to pay for content that may have been free in the past.
Conclusion: How Does Quora Make Money?
As we can see, Quora has a rather simple model at its core. Quora is a community-driven website, with lots of valuable information from experts and professionals around the world. It is designed to be an intermediary between brands and consumers by facilitating the process of asking and answering questions.
The site has a solid business structure, a pretty decent value proposition, and a large user base, though the site still faces stiff competition from other social networking services such as Reddit and even Facebook itself.
Quora has the potential to become a successful media company. Its business model appears to be geared towards monetization through content subscriptions and advertising for businesses. It seems that in this case, being a platform helps them out and it does not just become a second hand information from different sources as all other search engines are.
We hope you’ve enjoyed our examination of how the Quora juggernaut makes a profit. You’ve seen the numbers and learned about their diverse revenue streams. We’ve also looked at their business model and how they collect data from their users. Now that you know how Quora makes money, it might be time to start using their service for yourself.
I’m not sure what else to write at this point so I’ll stop, but I appreciate you reading this, and hope it was helpful. Until next time, take care!