Author: Steve
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Axios’ App rush: Talent over trash covers the growth of social media apps where the content is created by digital content creators who are getting paid. Key quote:
The big picture: Creator-economy platforms like Patreon, Substack and OnlyFans are built around content makers who are paid. It’s a contrast to platforms like Facebook that are mostly powered by everyday users’ unpaid posts and interactions.
Most of the creator economy platforms pay creators in some form of royalties or advertising revenue share agreements.
But some of them – Patreon and Substack, for example – provide mechanisms for creators to have more direct relationships with their fans and generate revenue a variety of ways (subscriptions, merchandise sales, etc.).
According to the venture capital firm SignalFire, there are about 50 million income earning creators across the globe (click to enlarge the charts below).
This estimate was developed using a bottom’s up count across the major creator platforms such as YouTube, Instagram, Twitch and others. The estimates of professionals versus amateurs are based on traffic.
And as the chart below shows, there are numerous platforms catering to creators.
Key quote on how SignalFire explains the rapid growth of the creator economy:
So how did creatorship grow so quickly? There’s been a societal shift in consciousness towards caring more about feeling fulfilled in our jobs, having control over how we spend our time, and being our own boss. Fans see creators doing what they love for a living and aspire to follow that path that never leads to a cubicle.
Regular readers will recognize this is basically the same explanation as one of the main reasons why the independent workforce has grown, which is the desire for work autonomy, control and flexibility.
A variety of names have been used for the creator economy. We include content creators in our definition of the Artisan Economy, which we started using over a decade ago. It’s a broader definition and includes makers, crafters and knowledge artisans. And, of course, creators earning money independently are independent workers.
More recently, the venture capital firm Atelier called it The Passion Economy in an essay that drew a lot of attention.
But even more recently, Atelier switched to calling it the creator economy in their Harvard Business Review article The Creator Economy Needs a Middle Class.
This article points out one of the issues facing the creator economy is while a few creators make lots of money, most make very little. Key quote:
On Patreon, only 2% of creators made the federal minimum wage of $1,160 per month in 2017 … On Sportify … the top 43,000 artists — roughly 1.4% of those on the platform — pull in 90% of royalties and make, on average, $22,395 per artist per quarter. The rest of its 3 million creators, or 98.6% of its artists, made just $36 per artist per quarter.
We think the creator economy will continue to rapidly grow. We also think the name is here to stay (at least for awhile).
BTW, Atelier’s newsletter is excellent and anyone interested in the creator economy should sign up for it.