Is Stack Overflow a business success?

Question

I'm interested to know if Stack Overflow earns money.

If yes, how? Any statistics? Is it a good business model?

Answer 1

2022 Answer

As of 2022, Stack Overflow has its "Teams" product, which is a private version of Stack Overflow for organizations.

It has also been purchased by Prosus (a Venture Capital firm; though this acquisition feels more "private equity"-ish).

How do they make money today? Teams, and Ads in the form of normal ads and Employer Branding. Is that money enough? That's wholly unclear since it's now in private hands that aren't as forthcoming about their revenue and designs as the original founders were.

Talent (as we knew it) is gone. Careers (as we knew it) is gone.

The original answer is still relevant in its broad strokes; but going forward I anticipate we'll see more direct monetization attempts.

Original Answer (2009)

Stack Overflow as a business model is highly dependent upon its advertising model -- which is directly related to the value of advertising on the internet.

In an effort to branch out from this dependency, They've released the "Stack Exchange" product as well as careers.stackoverflow.com and jobs.stackoverflow.com.

I'll discuss each in turn.

Advertising: The tried-and-true business model of the internet. In times of recession, ad-revenue is down across the board, but it's still the lowest friction way to make money. It requires the least resources from a business perspective.

Stack Exchange: This one puzzles me. I don't know if Stack Overflow LLC licenses the Stack Overflow source code to FogCreek (which would seem to make the most 'legal' sense since they are two separate entities) or if they 'sold' it outright. Or, as a third alternative, they have a business agreement that allows for a split of the revenues and they promise to share the improvements to the source code model.

The main problem with Stack Exchange is that it is an unproven business model. How many 'pay for private knowledge exhcange' sites do you know of? The cost is also subject to change. If they charge too much, they make too little, but if they don't charge enough, they don't make nearly as much. It's also dependent upon how the people that use it either monetize it, or write it off as a business expense. The latter depends upon Stack Exchange bringing some sort of business value that justifies the expense. Only time will tell.

Jobs: As Joel points out the jobs board brought about 1 million in revenue in its first year. I can only assume it brings in more now -- and with Stack Overflow and its sister sites, I'm sure Stack Overflow LLC gets a cut of that revenue as well.

Careers: The first effort by Stack Overflow LLC that doesn't seem dependent on Fog Creek support (even the monetization of Stack Exchange requires Fog Creek support, as Aaron is a Fog Creek employee). It requires that developers and businesses pay to get a seemingly 'high quality' pool of applicants. It deserves its shot; but I'm leery since it's trying something very new (charging applicants!).

Success is a subjective factor, but business success isn't. Stack Overflow is able to pay three employees (not including the Ad guy) and cover its hosting cost. It's currently the new hotness in the programming world. Where else can you have Jon Skeet, Eric Lippert, Alan Kay, Joel Spolsky, Jason Cohen, Jeff Atwood, and many other 'rockstars' of our industry participate on a daily basis? It sounds like hero worship, but the quality they bring is immeasurable. It's an exciting time to be a developer.

Answer 2

I cannot really comment on this, but you can certainly use public information to see the "health" of the company.

Like our traffic:

http://quantcast.com/stackoverflow.com
http://siteanalytics.compete.com/stackoverflow.com+experts-exchange.com/

And how many people work for the company now:

https://blog.stackoverflow.com/2009/01/welcome-stack-overflow-valued-associate-00002/
https://blog.stackoverflow.com/2009/05/welcome-stack-overflow-valued-associate-00003/