Viewers like you.

Donations

My single user instance cost almost zero.

Self-hosted on my hardware that already used to host other stuff. Cpu overhead seems negligible, and network bandwidth is free (=already paid for). Disk space is nothing compared to my Linux ISOs collection.

Many small server instances are paid for out of pocket (you can make your own too, about $60/year renting a cloud server and $10/year for a domain name). Bigger servers rely on user donations.

The Lemmy software development relies on donations as well, but they also receive grants from NLNet. Some of the grants are tied to accomplishing specific features. Third party app developers generally rely on donation support as well, if they’re not doing it just for the fun of it. Unsupported projects tend to get dropped after a while, though, so money does help keep up motivation.

https://github.com/LemmyNet/lemmy#support--donate (Lemmy development) or check the sidebar of a specific instance to see if they accept donations toward hosting costs.