These are all good questions and lead you to explore more about what it means to run software.
So as well as the instance (domain name / hardware server) admins, there are also the open source developers of the Lemmy software. They keep things updated and put out new features and releases. They currently have a (partial) grant from some European agencies who are making sure that open source software isn't all built and owned by American corporations.
It would be good for every instance to allocate some funding to the open source software they rely on.
I'm one of the people responsible for (currently a test Lemmy instance) news.cosocial.ca. Our main service today is our Mastodon server (cosocial.ca). We are a registered member-owned Canadian cooperative. Every member has paid at least $50 per year. We currently have volunteer moderators and server admins, our goal is to eventually pay those roles. More on our blog.
We're also here to be a resource to anyone running services in Canada, especially if you need legal or other help. /me waves at smorks
Back to keeping things running: the Lemmy software needs a bunch more features to scale. The moderation tools are very basic, there are a couple of mobile apps in development that are very early on. We should think about pooling funds and donating.
It's great to see Lemmy.ca on OpenCollective (we use it for Cosocial too). I've just donated as a $5 monthly backer. Thanks for setting this up!
Everybody is different, but I'd suggest subscribing as a backer or just tossing in a one time donation to start to support @smorks@lemmy.ca and Lemmy.ca.