Issue #11 - May 28

How the explosion in major platform creator features is shaping the creator economy

For the first 5 months of 2021, it’s been a nearly daily news staple that a larger platform is rolling out yet another product to help creators monetize. Jack Conte’s now infamous flywheel video captures the zeitgeist of the creator economy incredibly and aptly predicts the continued love affair that platforms are having with creators.

We compiled a list of these products in a previous CreatorScape a few weeks ago and that list is already outdated - Snap has announced tipping and Adam Mosseri has suggested that subscriptions are coming to Instagram.

So we decided this week to do a thought experiment and consider what happens in a world where every major platform offers the following creator products easily accessible to any creator of any size:

  • Tipping

  • Subscriptions

  • Live event features (audio or video) with payment-gated access

  • Advertising revenue sharing (directly or through creator funds)

  • Ecommerce functionality (such as merch or live shopping)

Some thoughts:

  • Tipping would appear to be a product with limited platform lock in (you might tip the same creator on multiple platforms if they are making content there that you like). We suspect that tipping becomes more of an audience engagement mechanism and mid-funnel mechanism as creators continue to work to build closer relationships with their communities and slowly train them to part with their $$$.

  • Will creators have subscriptions on multiple platforms or will they use one platform as a subscription processor and redirect paying customers to other private locations? To some extent this is how Patreon works now - become a patron and get access to a Facebook group.

  • There will likely be a flood of entrants and investor money into the whitespace that is not going to be offered by the platforms. Chat-format communities (ala Slack and Discord) will grow quickly as there is generational understanding of them. The platforms will have a hard time getting rid of their old Groups formats and adopting this new model even though they lend themselves to creator communities much better than traditional Facebook Groups and awkward DM groups on Instagram and Whatsapp.

  • What formats will be added to the basic canon of creator products that every platform offers? Would Cameo-style video messages be a target for someone like Facebook or does this blur the lines of being a media company?

  • Link-in-bio tools will play an even more pivotal role in direction payment seeking audiences to the right location. If I want to subscribe to a big creator who’s on multiple platforms, how do I figure out where they are accepting payments?

  • More fintech companies will emerge to help creators sew data together from all these platforms. Stir seems well positioned to become the aggregated view of all of these on-platform financial data sources.

  • We’re seeing the birth of a new category of payments: creator payments from their audiences. While still in its infancy, the potential volume of transactions and total money moving in this way is massive. Many think the next move of the platform companies is to become eCommerce companies but it’s possible the stronger move is to become a payments company. Facebook already integrates peer to peer payments and has a nascent crypto payments backbone with Diem (formerly Libra) but it feels like a creator-economy era payments company is inevitable.

  • Will Patreon be driven down the path of being the PayPal of the creator economy (already Twitter accepts Patreon as a form of payment) or will they climb up the stack and become more of a content publishing and consumption platform? Patreon has great opportunity in both directions but increasingly stiff competition as well.

  • A primary reason why platforms could win at the subscription game is because of their inherent discovery mechanism. If platform discovery proves to drive creator monetization, existing platforms have huge existing advantages over any startup in the ecosystem.

  • Discovery will continue to be a firebrand issue in the creator economy. One camp (Mighty, Kajabi, etc..) might argue that part of their value proposition to creators is they give them a brandable space to bring their audience into where their audience won’t be poached and lured into other paying communities. This might cause those fans to churn from yours. To some extent subscriptions will see a Udemy vs Teachable battle (which is really discovery-based vs not). Udemy is technically the bigger winner so discovery could arguable be the lynchpin feature.

  • One of the achilles heels of how platforms approach subscriptions is that they do not share subscriber and fan data. If someone subscribes to you, you don’t get their email. This means the platform continues to be rented, even though you’re collecting money “directly” from your fans. There is a huge tidal swell towards owned platforms. Derek Yang just published a fantastic piece on this.

  • The battle over owning your audience is very akin to the Amazon vs Shopify battle. Amazon is notorious for sharing very little data with their marketplace merchants. They provide so much discovery that their argument is you can either get their discovery (e.g. stay) or get your own data (e.g. leave). This similar posture is forming with the platform companies (Apple included with their new podcast subscription products). Clearly Shopify has shown that at some point market forces will favor a counterpoint to this approach and an owned platform will emerge at scale. Is this Patreon? We’d love to hear who you think wins here.

Hopefully this gets everyone thinking over the long weekend? We look forward to how much the creator economy will have changed by the time we get back in June!

- Niel and Ryan