GitHub Sponsors and Open Collective Guide

Two Platforms, One Goal

You’ve decided to seek sponsorship for your open source project. Smart move. Now you face a choice: GitHub Sponsors, Open Collective, or both?

Each platform has strengths. GitHub Sponsors integrates seamlessly with your development workflow. Open Collective offers transparency and fiscal hosting. Many successful projects use both.

This guide walks you through setting up and maximizing both platforms, helping you build sustainable funding for your open source work.

Understanding the Platforms

Before diving into setup, understand what each offers.

GitHub Sponsors

What it is: Platform for sponsoring developers and projects directly through GitHub.

Key Features:

• Integrated: Native GitHub experience
• No fees: GitHub doesn’t take a cut (payment processor fees only)
• Tiers: Customizable sponsorship levels
• One-time or recurring: Flexible payment options
• Company matching: Some companies match employee sponsorships
• Profile integration: Sponsor button on all your repos

Best for:

• Individual developers
• Projects with strong GitHub presence
• Direct maintainer support
• Simple, low-overhead sponsorship

Open Collective

What it is: Platform for transparent collective funding with fiscal hosting.

Key Features:

• Transparency: All transactions public
• Fiscal hosting: Legal and financial infrastructure
• Expense management: Pay contributors, cover costs
• Team budgets: Multiple people can spend funds
• Tax benefits: Donations may be tax-deductible
• Collective governance: Shared decision-making

Best for:

• Projects with multiple contributors
• Organizations needing fiscal hosting
• Transparent fund management
• Collective governance
• Tax-deductible donations

Comparison Matrix

Feature	GitHub Sponsors	Open Collective
Fees	0% (+ payment processor)	10% platform + 5% payment
Transparency	Private	Fully public
Fiscal Hosting	No	Yes
Tax Benefits	No	Yes (via host)
Multiple Recipients	Difficult	Easy
Expense Management	No	Yes
GitHub Integration	Native	Via links
Company Invoicing	Limited	Full support
Setup Complexity	Low	Medium

Setting Up GitHub Sponsors

Step-by-step guide to launching your GitHub Sponsors profile.

Prerequisites

Requirements:

• GitHub account (obviously)
• 2FA enabled on your account
• Valid GitHub email
• Bank account or Stripe account for payouts

Eligibility:

• Individual developers: Any country with Stripe or GitHub Payments
• Organizations: Must be verified

Step 1: Join the Waitlist or Enable

For individuals:

1. Go to https://github.com/sponsors
2. Click "Join the waitlist" or "Set up GitHub Sponsors"
3. Complete the application
4. Wait for approval (usually instant now)

For organizations:

1. Verify your organization on GitHub
2. Navigate to organization settings
3. Click "Sponsors" in sidebar
4. Follow setup wizard

Step 2: Create Your Profile

Profile components:

## Your GitHub Sponsors Profile

**Profile Picture:** Use your GitHub avatar (automatic)

**Display Name:** Your name or project name

**Bio/Introduction:**
Brief description of who you are and what you build.

Example:
"I maintain [Project], used by 50,000+ developers. Your sponsorship
helps me dedicate time to keeping it secure and well-maintained."

**Featured Work:**
Automatically shows your popular repositories.

**Sponsorship Tiers:** (Detailed below)

**Additional Sections:**
- About me
- What sponsorship enables
- How funds will be used

Step 3: Design Your Tiers

Tier strategy:

## Tier Structure

**$5/month - Supporter**
- Perfect for: Individual users who benefit
- Perks:
  - Name in SPONSORS.md
  - Sponsor badge on profile
  - My gratitude!

**$25/month - Enthusiast**
- Perfect for: Regular users, small teams
- Perks:
  - All previous perks
  - Logo in README (optional)
  - Early access to release notes

**$100/month - Professional**
- Perfect for: Professionals, small businesses
- Perks:
  - All previous perks
  - Priority issue response (24h)
  - Name in release announcements
  - Logo on project website

**$500/month - Business**
- Perfect for: Companies using in production
- Perks:
  - All previous perks
  - Logo (large) on website
  - 2 hours consulting/month
  - Influence on roadmap

**$1,000+/month - Enterprise**
- Perfect for: Large companies, heavy users
- Perks:
  - All previous perks
  - Dedicated support channel
  - SLA for security issues
  - Custom tier available

One-time sponsorships:

## One-Time Sponsorship Tiers

**$10 - Coffee**
☕ Buy me a coffee, fund 1 hour of work

**$50 - Feature Request**
🎯 Priority feature request consideration

**$100 - Bug Bounty**
🐛 Thank you for security reports

**$500 - Major Contribution**
🚀 Significant one-time support

Step 4: Customize Your Sponsors-Only Content

Repository features:

## Sponsors-Only Features

**Private Repository Access:**
1. Create private repo: `sponsor-extras`
2. Grant access to sponsors
3. Include:
   - Beta releases
   - Advanced tutorials
   - Exclusive tools
   - Behind-the-scenes content

**Sponsor-Only Issues/Discussions:**
- Label: `sponsor-priority`
- Dedicated discussion category
- Faster response times

**Monthly Updates:**
- Technical deep-dives
- Roadmap previews
- Video walkthroughs

Step 5: Add Sponsor Button to Repositories

FUNDING.yml:

# .github/FUNDING.yml
github: [your-username]
open_collective: [your-collective]  # Optional
custom: ['https://yoursite.com/sponsor']  # Optional

This adds “Sponsor” button to all your repositories.

Step 6: Set Payout Preferences

Payment setup:

1. Go to Sponsors Dashboard
2. Click "Payouts" or "Payout settings"
3. Choose payout method:
   - Stripe (direct to bank)
   - PayPal (where available)
4. Set payout threshold (minimum before transfer)
5. Choose payout frequency (monthly typical)

Tax information:

US Citizens/Residents:
- Provide W-9 form
- GitHub issues 1099 if earning >$600/year

Non-US:
- Provide W-8BEN form
- Withholding tax may apply

Consult tax professional for your situation.

Step 7: Promote Your Sponsorship

In README.md:

## Support This Project

This project is maintained by volunteer effort. If it helps you,
consider sponsoring its development:

[![Sponsor on GitHub](https://img.shields.io/badge/Sponsor-GitHub-ea4aaa)](https://github.com/sponsors/your-username)

Your sponsorship helps:
- ⚡ Faster bug fixes and releases
- 🛡️ Security updates and monitoring
- 📚 Better documentation
- ✨ New features and improvements

In documentation:

---
sidebar_label: Sponsorship
---

# Support Sustainable Development

[Project] is free and open source, maintained by volunteers.

## Why Sponsor?

- Ensure long-term maintenance
- Get priority support
- Influence roadmap
- Support open source ecosystem

## Become a Sponsor

[Sponsor on GitHub](https://github.com/sponsors/your-username)

In social media:

🎉 Excited to announce GitHub Sponsors is now live for [Project]!

If you or your company benefit from [Project], please consider
sponsoring its development. Even $5/month makes a difference!

[Link]

#OpenSource #GitHub #Sponsorship

Setting Up Open Collective

Complete guide to launching on Open Collective.

Prerequisites

Requirements:

• Project or collective to fund
• Fiscal host or apply to Open Source Collective
• Bank account (for fiscal host)
• Clear purpose and governance

Fiscal hosts:

• Open Source Collective: Most OSS projects
• Open Collective Foundation: 501(c)(3) in US
• Europe Collective: European projects
• Custom: Set up your own

Step 1: Choose Your Fiscal Host

Open Source Collective (recommended for most):

## Open Source Collective

**Benefits:**
- No application fee
- 10% host fee (covers all overhead)
- 501(c)(3) status (tax-deductible in US)
- Easy onboarding
- OSS-friendly

**Requirements:**
- Open source project (OSI-approved license)
- GitHub repository with activity
- Clear description of project

**Apply:** https://opencollective.com/opensource/apply

Other options:

## Europe Collective
- For European projects
- IBAN transfers (no PayPal/Stripe fees in EU)
- VAT handling

## Open Collective Foundation
- 501(c)(3) for non-OSS projects
- Charitable projects
- Higher scrutiny

## Your Own Fiscal Host
- Full control
- More overhead
- Need legal entity
- Handle finances yourself

Step 2: Create Your Collective

Application process:

1. Visit https://opencollective.com/create
2. Click "Create a Collective"
3. Fill out form:
   - Collective name
   - Slug (URL: opencollective.com/your-slug)
   - Description
   - Website
   - Repository link
   - Tags (programming language, category)
   - Logo/image
4. Submit for fiscal host approval
5. Wait 1-3 days for approval

Profile information:

## Collective Profile

**Long Description:**
Detailed explanation of:
- What the project does
- Why it exists
- Who maintains it
- Impact and users
- How funds will be used

Example:
"[Project] is a lightweight JavaScript library for [purpose].
Used by 50,000+ developers and companies like [Company A] and
[Company B].

Maintained by [maintainer names], we dedicate 20+ hours/week to:
- Security updates and bug fixes
- New feature development
- Documentation and support
- Community management

Your contribution helps us:
- Continue maintenance sustainably
- Respond to issues quickly
- Build new features
- Keep the project free and open source

100% of funds go to project expenses and contributor compensation."

**Team Members:**
- Add core contributors
- Set roles (Admin, Core Contributor)
- Public or private profiles

**Budget:**
- Set annual budget goal
- Explain how funds are used
- Update regularly

Step 3: Configure Tiers

Tier examples:

## Backer - $5/month or $50/year
Perfect for individuals who use the project.

Perks:
- Name on our website
- Backer badge
- Collective updates

## Sponsor - $100/month or $1,000/year
Perfect for small businesses and teams.

Perks:
- Everything in Backer
- Logo (small) on website
- Logo in README
- Collective updates

## Gold Sponsor - $500/month or $5,000/year
Perfect for companies using in production.

Perks:
- Everything in Sponsor
- Logo (medium) on website
- Logo prominent in README
- Priority support
- Monthly updates call

## Custom Sponsorship - $1,000+/month
For enterprises needing custom arrangements.

Contact us: email@project.org

---

**One-Time Contributions:**
Any amount welcome! Help fund specific goals.

Step 4: Submit Expenses

Expense workflow:

## Submitting Expenses

**Who can submit:**
- Core contributors
- People who've done work for project
- Approved by admins

**Types of expenses:**

**1. Reimbursement**
You paid for something, get reimbursed.

Example:
- Conference travel
- Domain registration
- Infrastructure costs

Requires:
- Receipt/invoice
- Description
- Amount

**2. Invoice**
You did work, submit invoice for payment.

Example:
- Development work
- Design work
- Documentation
- Support

Requires:
- Invoice document
- Description of work
- Hours/rate or fixed price

**3. Grant**
Regular payment to contributor.

Example:
- Monthly maintainer stipend
- Ongoing development work

Requires:
- Approved in advance
- Regular cadence

Expense example:

Title: May 2025 Maintenance Work
Description:
- Triaged 47 issues
- Merged 12 pull requests
- Released v2.3.0
- Updated documentation

Amount: $2,000
Attachment: invoice-may-2025.pdf

Step 5: Set Up Banking

Payout setup:

## Connect Bank Account

For individuals:
1. Go to your profile settings
2. Click "Payment Methods"
3. Add bank account or PayPal
4. Verify (micro-deposits or instant verification)

For organizations:
- Use organization bank account
- May require additional verification
- W-9 or W-8BEN form

**Payout timing:**
- Expenses approved by admins
- Fiscal host processes (typically weekly)
- Funds transferred to your account
- 5-10 business days total

Step 6: Enable Payment Methods

Available methods:

## Payment Methods for Donors

**Credit Card:**
- Stripe processing
- Instant contribution
- 2.9% + $0.30 fee

**PayPal:**
- Alternative to credit card
- Some prefer it
- Similar fees

**Bank Transfer:**
- For large donations (>$1,000)
- Lower fees
- Slower processing
- Manual handling

**Cryptocurrency:**
- Some fiscal hosts support
- Bitcoin, Ethereum
- Special setup required

Step 7: Transparency Features

Public budget:

## Budget Transparency (Automatic)

Open Collective automatically shows:

**Income:**
- All contributions (amounts, donors)
- Recurring vs one-time
- Monthly trend

**Expenses:**
- All expenses paid
- Recipients
- Purposes
- Invoices/receipts

**Balance:**
- Current available funds
- Funds held by fiscal host
- Pending expenses

Example: opencollective.com/your-collective/transactions

Annual reports:

## Yearly Transparency Report

Open Collective generates:
- Total raised
- Total spent
- Top contributors
- Top expenses
- Growth metrics

Export as PDF and share widely.

Using Both Platforms Together

Maximize reach by using both GitHub Sponsors and Open Collective.

Strategy: Complementary Use

GitHub Sponsors for:

• Individual contributors
• Personal support of maintainers
• GitHub-native users
• Lower fees (no platform fee)

Open Collective for:

• Project/collective funding
• Transparent budgets
• Multiple contributors
• Corporate sponsorships needing invoices
• Tax-deductible donations

Linking Both Platforms

FUNDING.yml with both:

# .github/FUNDING.yml
github: [your-username]
open_collective: [your-collective]

In README:

## Sponsorship

Support this project through:

**Individual Sponsorship:**
[![GitHub Sponsors](badge)](https://github.com/sponsors/username)

**Project/Company Sponsorship:**
[![Open Collective](badge)](https://opencollective.com/your-collective)

### Which to choose?

- **Individuals**: GitHub Sponsors (easier, lower fees)
- **Companies**: Open Collective (invoicing, tax benefits)
- **Flexible**: Both work!

Fund Allocation Strategy

Split model:

## How We Use Funds

**GitHub Sponsors (→ maintainer directly):**
- Maintainer personal income
- Individual support
- Flexible use

**Open Collective (→ collective budget):**
- Project expenses (infrastructure, domain)
- Contributor compensation
- Community initiatives
- Transparent collective use

Both support the project sustainably!

Unified model:

## Consolidated Funding

All funds support [Project] sustainably:

**Contribute via:**
- GitHub Sponsors
- Open Collective

**Funds used for:**
- Maintainer compensation ($X/month each)
- Infrastructure costs ($Y/month)
- Contributor bounties
- Community events
- Security audits

Quarterly transparency reports published.

Maximizing Your Sponsorship Success

Get the most from both platforms.

Regular Communication

Monthly updates:

## November 2025 Update

**Development:**
- Released v2.4.0 with [features]
- Resolved 23 issues
- Merged 15 PRs from 8 contributors

**Community:**
- 234 new GitHub stars
- 12 new contributors
- Discord: 156 active members

**Financials:**
- GitHub Sponsors: $2,340
- Open Collective: $4,100
- Total: $6,440 (+12% from October)

**This Month:**
- Paid 3 contributors for work ($3,200)
- Infrastructure costs ($180)
- Saved for security audit ($3,060)

**Next Month:**
- Focus on [feature]
- Security audit scheduled
- Conference talk at [event]

Thank you to all sponsors! ❤️

Quarterly reports:

## Q4 2025 Report

**Impact:**
- 156 issues resolved
- 3 major releases
- 5 security fixes
- Documentation rewrite completed

**Community Growth:**
- Contributors: 45 → 67 (+49%)
- GitHub stars: 4.2k → 5.8k (+38%)
- Discord members: 120 → 234 (+95%)

**Sustainability:**
- Monthly recurring: $6,440 (from $3,200 in Q3)
- Sponsors: 89 (from 52 in Q3)
- Corporate sponsors: 8 (from 4 in Q3)

**Use of Funds:**
- Contributor compensation: $18,600
- Infrastructure: $540
- Conference travel: $2,100
- Security audit: $5,000
- Savings: $8,000

**Q1 2026 Goals:**
- Reach $8k/month recurring
- Onboard 2 more core contributors
- Major version 3.0 release

Sponsor Recognition

Website sponsors page:

<!-- sponsors.html -->
<section class="sponsors">
  <h2>Thank You to Our Sponsors</h2>

  <div class="tier gold">
    <h3>Gold Sponsors ($500+/month)</h3>
    <div class="sponsor-grid">
      <a href="https://company-a.com">
        <img src="company-a-logo.svg" alt="Company A">
      </a>
      <!-- More gold sponsors -->
    </div>
  </div>

  <div class="tier silver">
    <h3>Silver Sponsors ($100+/month)</h3>
    <!-- Silver sponsors -->
  </div>

  <div class="tier bronze">
    <h3>Bronze Sponsors ($25+/month)</h3>
    <!-- Bronze sponsors -->
  </div>

  <div class="tier backers">
    <h3>Backers</h3>
    <p>Thank you to all our individual backers!</p>
    <a href="https://github.com/sponsors/username">All backers →</a>
  </div>
</section>

README recognition:

## Sponsors

This project is made possible by our sponsors:

### Gold Sponsors

<a href="https://company-a.com"><img src="https://company-a.com/logo.svg" width="200"></a>

[Become a Gold Sponsor](https://opencollective.com/project)

### All Sponsors

Thank you to all our [GitHub Sponsors](link) and [Open Collective backers](link)!

Social Proof

Showcase impact:

## Project Usage

Trusted by:
- 🌍 50,000+ developers worldwide
- 🏢 Used by Microsoft, Google, Amazon (public documentation)
- 📦 100M+ npm downloads
- ⭐ 15k+ GitHub stars

Your sponsorship makes this possible!

Testimonials:

## What Sponsors Say

> "[Project] saved us countless hours. Sponsoring was an easy decision."
> — CTO, Company X

> "Best investment in our infrastructure. Worth every penny."
> — Lead Engineer, Company Y

> "Finally, sustainable open source that just works."
> — Developer, Company Z

Tax and Legal Considerations

Important financial matters.

For Recipients (You)

GitHub Sponsors:

## Tax Treatment (US)

**Self-Employment Income:**
- Reported on Schedule C
- Subject to self-employment tax (15.3%)
- Can deduct business expenses
- Estimated quarterly taxes may be required

**Forms:**
- W-9 (if US person)
- W-8BEN (if non-US)
- 1099-NEC issued if >$600/year

Consult a tax professional.

Open Collective:

## Fiscal Hosting

**Through Fiscal Host:**
- Host is legal entity
- They handle taxes
- You receive contractor payments
- Issue you 1099 or W-2

**Expenses:**
- Submit invoices to collective
- Paid by fiscal host
- Host handles tax reporting

**Benefits:**
- Simpler for you
- Legal protection
- Professional structure

For Sponsors (Companies)

Tax deductibility:

## For Corporate Sponsors

**GitHub Sponsors:**
- Generally NOT tax-deductible
- Treated as business expense (marketing/R&D)
- May deduct as ordinary business expense

**Open Collective (via 501(c)(3) host):**
- MAY be tax-deductible charitable contribution
- Depends on jurisdiction and host status
- Get receipt from fiscal host

Consult your accountant.

Troubleshooting Common Issues

Solutions to frequent problems.

GitHub Sponsors

Problem: Not seeing sponsor button

Solution:
1. Check FUNDING.yml exists in .github folder
2. File must be named exactly: FUNDING.yml
3. Syntax must be valid YAML
4. May take a few minutes to appear after push
5. Check on repository main page

Test:
https://github.com/username/repo

Problem: Sponsors not showing on profile

Solution:
1. Sponsors can choose to be private
2. Check Settings → Sponsors → Visibility
3. Some sponsors hide their sponsorship
4. This is normal and expected

Problem: Payouts not processing

Solution:
1. Verify bank account is connected
2. Check payout threshold met
3. Review tax forms submitted
4. Contact GitHub Support if issues persist

Open Collective

Problem: Expense rejected

Common Reasons:
- Missing receipt/invoice
- Amount doesn't match receipt
- Outside approved budget
- Not from approved contributor

Solution:
- Resubmit with correct information
- Contact admins for clarification
- Ensure expense aligns with collective goals

Problem: Low contribution rate

Possible Issues:
- Not enough promotion
- Unclear value proposition
- Tiers not appealing
- Limited payment methods

Solutions:
- Promote more visibly (README, website, social)
- Clarify how funds are used
- Adjust tier pricing/perks
- Enable more payment methods

Problem: Fiscal host approval delayed

Patience Required:
- Open Source Collective reviews in 1-3 days
- Complex cases may take longer
- Ensure application complete

If delayed >1 week:
- Email: support@opencollective.com
- Check application wasn't flagged
- Follow up politely

Success Metrics

Track what matters.

Key Performance Indicators

## Monthly Metrics

**Revenue:**
- Total monthly recurring revenue (MRR)
- Year-over-year growth
- New sponsors vs churned sponsors
- Average sponsorship amount

**Engagement:**
- Website visits to sponsor page
- Click-through rate on sponsor buttons
- Email open rate for sponsor updates
- Social engagement on sponsor posts

**Impact:**
- Issues resolved per dollar
- Features shipped per dollar
- Contributors compensated
- Infrastructure maintained

**Sustainability:**
- Months of runway (savings / monthly expenses)
- Percentage of maintainer time funded
- Diversification (number of significant sponsors)
- Churn rate

Dashboard example:

## December 2025 Metrics

📈 **Financial Health:**
- MRR: $6,440 (+15% MoM)
- One-time: $1,200
- Total: $7,640
- Expenses: $4,680
- Savings: $2,960
- Runway: 8 months

👥 **Sponsor Growth:**
- Total sponsors: 94 (+8)
- New this month: 12
- Churned: 4
- Net growth: +8 (+9%)

💪 **Project Impact:**
- Contributors compensated: 4
- Issues resolved: 28
- PRs merged: 18
- Releases: 1 (v2.5.0)

🎯 **Goals:**
- ✅ Reach 90 sponsors (achieved!)
- ⏳ $8k MRR (at $6.4k, 80%)
- ✅ Compensate 3+ contributors (achieved!)

Your Action Plan

Get started today.

Week 1: Setup

Day 1-2: GitHub Sponsors

• Apply for GitHub Sponsors
• Draft profile content
• Design sponsorship tiers
• Create FUNDING.yml file

Day 3-4: Open Collective

• Apply to Open Source Collective
• Create collective profile
• Set up tiers
• Invite team members

Day 5-7: Integration

• Add sponsor buttons to README
• Create sponsors page on website
• Draft launch announcement
• Prepare social media posts

Week 2: Launch

Day 8-10: Soft Launch

• Announce to existing community
• Email project users (if applicable)
• Post in project Discord/Slack

Day 11-14: Public Launch

• Social media announcement
• Post on Reddit/Hacker News (if appropriate)
• Write blog post about sustainability
• Reach out to potential sponsors directly

Month 1: Optimize

• Monitor metrics
• Respond to sponsors personally
• Adjust tiers based on feedback
• Share first update with sponsors

Quarter 1: Scale

• Identify major corporate users
• Personalized outreach to companies
• First quarterly transparency report
• Evaluate and adjust strategy

Conclusion

GitHub Sponsors and Open Collective provide powerful platforms for sustainable open source funding. The key is to:

Start simple:

• Set up basic profiles
• Create clear tiers
• Make sponsorship visible

Communicate regularly:

• Monthly updates
• Quarterly reports
• Respond to sponsors personally

Show impact:

• Track and share metrics
• Highlight accomplishments
• Demonstrate value

Stay transparent:

• Share how funds are used
• Be honest about needs
• Celebrate successes

Be persistent:

• Building sustainable funding takes time
• Don’t get discouraged by slow starts
• Keep improving and promoting

Your open source work has value. These platforms help you capture some of that value to make your work sustainable.

Start today. Set up your profiles. Launch your sponsorship program. Build something sustainable.

The open source community needs your work. Sponsorship makes it sustainable.

Now go make it happen.