I decided to start up an instance for our subreddit and it’s been working out really well so far. It was probably about 8 hours of work to get everything together, get our daily posts to go up, etc. A few bugs to work out but overall people are pretty happy with it.

This worked well for us because our sub is a tight knit community. Other tight knit communities might consider something similar, and then just federating with the larger instances.