Not really a “business model”, but let’s go with it anyway. The donations model is when the project sets up a system of donations, which are used to sustain the project.
When the project is core infrastructure, primarily run by volunteers, or simply to do good in the world.
Anything that is valid under the license. In this model, though, sponsorship and individuals alike are solicited to cover the infrastructure and development costs for the project.
Take a look at the Webpack Open Collective for a great example of the donation model in action.