WordPress has conquered the web ever since it has emerged, and it doesn’t look like it will fall back soon. Last year, its market share has grown by 4% on the web.
You might wonder how does it make money and who is behind it? Well, read on and you will find out.
Brief History
2003 was probably the beginning of a new era for the internet as Matt Mullenweg and Mike Little announced WordPress’s first version.
Its foundations relied on b2 Cafelog, but WordPress offered much more to users – a friendlier interface and templates mainly focused on content creators, rather than businesses.
And bloggers were looking for an alternative to the dominant tool at that time Moveable Type. The thing is, bloggers didn’t like too much their new T&C and wanted to write freely and enjoy previous content rights for the least.
Ever since, WordPress began its skyrocketing growth that continues now, 20 years later.
But things aren’t so simple, as WordPress is not only a CMS (content management system) available on WordPress.org, but also a hosted platform for website creation/management, available on WordPress.com.
To make things clear, there are two platforms – WordPress.org and WordPress.com.
Difference between WordPress.org and WordPress.com
WordPress.org
WordPress.org is the core of the entire ecosystem. The WordPress software is open-source and is free, which means it can be used and modified by anyone for any purpose.
It leads the way to total freedom of using the platform without any limitation. In other words, WordPress.org is representing the community that builds websites using the software with the same name.
WordPress.org is developed by contributors and gets both technical and visual improvements over time.
There is one important thing you need to know about WordPress.org – it’s a self-hosted platform. This means that you need to get your own hosting and install WordPress over there.
WordPress.org offers many outstanding features + flexibility via themes and plugins. It allows you to build a website pretty easy and save a fortune on web development and design. In fact, you can create a WordPress site for only $60.
WordPress.com
WordPress.com is the commercial version WordPress.org. It explicitly offers products such as hosting, domain names, themes, plugins, and even dedicated services for enterprises.
WordPress.com is a hosting service, and this means that all websites created there, remain there. The plans start at $4 / month and offer everything you need to launch a website.
Who Owns WordPress?
WordPress.com is officially owned by Automattic company, which is ruled by Matt Mullenweg. He is also the co-founder and lead developer of WordPress.org software.
So, Matt Mullenweg is behind both WordPress.org and WordPress.com. When he founded WordPress.org in 2003, he pursued the initial purpose of providing an alternative that will help bloggers to make their publishing easier, faster, smoother.
But the open-source software didn’t bring any money as a tool, and there should have been a solution to monetize the entire development effort. And that solution came fast – Mullenweg launched WordPress.com in 2005 and later in 2012, launched WordPress VIP – a dedicated service for enterprises.
But that’s only one part of the story. There are more things to say about Automattic as the story goes beyond WordPress.
Automattic runs a few other successful companies/projects like:
- Tumblr
- WooCommerce
- Pocket Casts
- Simplenote
- Happy Tools
- Jetpack
- Akismet
- Gravatar
- Longreads
Most of the projects have been created from scratch, other companies have been acquired, for example Tumblr and WooCommerce. You can check the list of major acquisitions in the WordPress market.
Automattic Valuation and Investors
With such a wide portfolio of brands, Automattic is worth a fortune.
Back in 2014, Automattic was valued at $1.2Bn and they have almost tripled their worth in 5 years.
According to a TechCrunch report, Automattic was estimated at $3Bn in 2019 after closing a $300M funding round which by the way had a single investor – Salesforce Ventures.
Before the funding round in 2019, Automattic was funded by other investors too. The second-largest funding round was in 2014, with a series of investors like Insight Ventures, True Ventures, Chris Sacca, Endurance, Tiger, and Iconiq among others, and it raised $160M.
As of 2022 Automattic counts 35 investors, and the most recent funding round was in February 2021, with a $288M investment. Automattic is currently valued at $7.5Bn, which is twice more than in 2019.
Automattic Staff and Salaries
Automattic has more than 1,900 employees in 96 countries speaking 121 different languages. Although it has a mailing address in San Francisco, the company is fully distributed and all the employees work remotely.
Automattic was one of the few companies to embrace remote work, long before it was a necessity. In 2017, they closed their office because not enough employees used it.
The average salary at the company is $62/hour or $130,968/year, according to Comparably. At the same time, the highest-paid job at Automattic is Corporate Counsel, who brings home $216K/year, not bad!
How Automattic Makes Money from WordPress
Automattic has multiple sources of revenue, including WordPress.com. Here is a breakdown of its main income channels:
1. WordPress.com
WordPress.com offers 5 pricing plans, 4 of them are paid. The more money you pay, the more control you get over your website + extra features.
The cheapest plan is for personal use and is $4/month if you pay yearly or $7/month if you pay monthly.
The most expensive plan is for eCommerce and is $45/month if you pay yearly or $59/month if you pay monthly.
2. WordPress VIP
The VIP Plans start at $2,000/month but the final price varies in multiple factors. VIP plans are tailored to enterprise websites.
WordPress VIP is used by popular brands such as Airbnb, TED, Disney, and Spotify among many others.
3. Advertisement
WordPress makes money from advertisement on free websites. The T&C of WordPress.com says that Automattic has the right to place advertisement on free-plan users’ websites and get the revenue generated from ads.
4. Themes
Most of the WordPress.com themes are free, and that’s great. But there is also a selection of good-looking premium WordPress themes that Automattic makes money with. All themes are priced at $50 / theme.
There are no 3rd party premium themes available on WordPress.com at the moment.
If you’re using WordPress.org though, you can choose from a multitude of premium themes with amazing features and design. Astra and Kadence are 2 of the most popular themes.
5. Plugins
Some of the most used plugins on websites built with WordPress.org are developed and powered by Automattic. These plugins are available for free, but you can pay an extra fee if you need more advanced features or extensions.
Here are some examples. Every plugin is used on more than 5 Million websites:
Automattic earns money from WordPress.org plugins and even if there are real alternatives to all their tools, users tend to trust those created by the original source.
Wrapping things up
Even though WordPress has a huge user base and powers almost half of the entire web, it generates less income compared to other commercial platforms. That’s because it’s not commercial oriented and is mainly focused on community.
I like WordPress, do you like it too or considering it for your website? If yes, check out how to create a WordPress site and its approximate cost.
