You are aware that an entire generation of Internet forums operated (and still operate) this way, right? Big forums had big hosting costs and required donation

You are aware that an entire generation of Internet forums operated (and still operate) this way, right? Big forums had big hosting costs and required donations from members, had issues with spam, had to source volunteer moderators from the community, etc., just like big Mastodon instances today. Small forums had few of those issues because the scale was smaller. The problem was not that nobody wanted to run a small forum: it's actually kind of fun to be a forum admin for your friends, and only one person in the group actually needs to be the admin. The problem was that nobody wanted to be on a small forum because it was small. Now you can have it both ways: a small instance with trivial running cost and moderation demands, but all the benefits of being on a huge forum with thousands of concurrent users. See also: Discord servers. Administering a Mastodon instance that you pay someone to host is not much more difficult than administering a Discord server. If people found it difficult to moderate a Discord server, why would so many friend groups, gamer groups, content creators, sub-Reddits, and software projects have their own small Discord servers? The answer is that the cost of moderating a small group of people is really small because small groups are easy to moderate, and the main downside of a small group isn't really relevant when the small group can follow and interact with anyone in the huge federated network.