#24: Digging deeper into Patreon

This week I discuss Patreon and an interview with it’s co-founder, Jack Conte.

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Membership is about that stronger relationship between a creator and their most important fans and the belief in that creator and their ongoing artistic expression. The creators who do best are the creators who deeply love their fans and whose fans deeply love them back if there’s a really strong connection.

Jack Conte

I’ve spoken at length that creatives need to look at marketing as building relationships (I echo this a lot in one-on-one interactions too). That removes the feel of trying to make someone buy something – something purely transactional.

Selling isn’t something that’s natural to most people; having relationships is natural to everyone.

(Whether someone is good at relationships is another issue entirely.)

Before getting started I want to make clear that I like Patreon.

They offer a good, reliable service with reasonable fees – 5-12% (plus another ~2.5% taken by the payment processor). It’s a lot better than the 30% fee that YouTube takes for channel memberships; iirc it’s the fee Facebook charged for it’s failed membership attempt.

Patreon is good for creators. I just hope they stay as is.

I believe...
The words ‘I believe’ always bring Morpheus to mind.

I believe that the only 100% reliable option for anything is something that you own 100%. That means you pay for the server space, you own the website (which you can move to a different server anytime), and you own the domain name.

(Check out my views on digital sharecropping as they’re relevant to this discussion.)

Building a membership on Patreon means building on a website and infrastructure that someone else owns – there’s no way to get around that. But unlike other platforms, Patreon provides access to member email addresses so any creator can export their list and leave. Youtube and Facebook don’t do this; most platforms don’t.

Patreon’s also good in that there is no content delivery algorithm. All of your patrons see all of your posts. Facebook, Youtube, and Twitter only deliver your posts to a small fraction of your followers.

(And doesn’t ‘follower’ just sound kinda lame? Does anyone want to wear a t shirt proclaiming I’M A FOLLOWER?)

Overall, Patreon is good. And I agree with Conte’s views on membership and relationships (read the interview I’m referencing here – it’s well worth your time).

My concern is whether Patreon stays good or not.

Their valuation just tripled to $4 billion.

(FYI Just weeks after receiving the investments that led to this valuation, they laid off 13% of their employees.)

And they had an attempted fee change 4 years ago that was so poorly received they quickly walked it back 6 days later. The fee change targeted small donations by adding a $.35 fee to all pledges.

Most creators start with a $1 membership level so you can see how that affected creator income. It’s a good that they walked it back but the attempted change always felt like a greedy analyst’s decision. It brings to mind this scene from Office Space:

Perhaps Conte and his crew were able to ward off the greed that time but they are dependent on venture capital. And venture capital comes with strings. When you’re playing with someone else’s money, the provider of the money almost always gets final say.

(They have to, to be honest. Giving someone millions with no strings attached implies either complete trust or absolute stupidity.)

I don’t know how Patreon’s decision-making works. I’m sure Conte has a lot of influence as co-founder. He gets why Patreon is necessary; he gets why Patreon is successful. But there’s no guarantee that he’s always going to be there. Perhaps he gets bought out. Perhaps they go public and he gets pushed out.

The chances of Patreon staying exactly as it is now is zero.

It behooves all creators on Patreon to have an exit plan. We keep backups of our important files, backups of our photos, backups of our websites, etc.

We need backup plans for our reliance on external platforms too.

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I do want to comment on a couple points Conte made in the interview.

Membership is a new category of essentially a business line for creators, where they can make subscription revenue from their most important fans, in exchange for benefits of membership.

There’s nothing new about memberships, neither offline or online. Creators have had mail-in fan clubs and mail newsletters for decades. This idea was transferred to the web when people made online versions of what they already knew.

iirc the first popular online membership option was Amember, starting circa 2003 as a php script that could be integrated with other php based content management systems. The number of options have blossomed since then, much of them piggybacking on WordPress’ steady growth (with a lot of demand instigated by information marketers).

What Patreon on did was create a platform focused on creators that allowed them to create a membership easily with zero technical knowledge necessary. Very cool – but remember that platforms are things to be used but not owned.

We launched an advance product on future expected earnings, on membership earnings, about a year and a half ago or two years ago. It’s in super alpha. We’ve only done a few deals. But we do deals, and we help creators understand, “How much am I making? How much am I going to be making?” Then we’ll give them an advance on those earnings.

This is interesting.

Success stories are what drive platforms – when we see someone else succeeding at something we (want to) do, we want to emulate that success.

If X works for [creator], maybe it’ll work for me too.

This idea of funding particular creators feels like a way to fight off membership-offering competitors like ko-fi, Buy Me A Coffee, Podia, etc. The more success stories there are on Patreon, the more attractive it will look to its competitors.

But this also hearkens back to the music industry that the internet upended.

Getting signed to a music label was (and often still is) just like this. A record company makes an investment in an artist, giving an advance, bankrolling recording expenses, paying for promotion, etc based on expectations of future earnings.

(Traditional publishers still work like this.)

This isn’t a benefit for creators as much as a strategic choice for Patreon. And interesting because it feels like going backwards more than going forwards.

Imagine Patreon as kingmakers. That’s kickin’ it old school – and not in a good way.

On those mass media companies, on those sites that are destinations — those are not solid platforms on which I can build a business as a creator. With one change, they can cut my traffic in half. I’m left as a creator with suddenly half the views, half the ad revenue, and none of the control. Now I’ve actually lost touch with half of my audience.

He’s talking about Facebook and Google, and Twitter to a lesser extent. All of them have controlled access to our content because we’re the product and their customers are advertisers.

But this applies to Patreon too.

They can choose to change their fee structure, or make any number of changes. Those are the risks of digital sharecropping.

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What I’m working on

I’ve been making steady progress on the pitch packet for my graphic memoir (some thanks to the the productivity system I overhauled last weekend). This consists of writing and re-writing.

I’ve also been developing a social media plan; perhaps I’ll share my progress soon.

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What I’m reading

Mostly Growing Gills, since I’ve focused on getting things done this past week. But I did read The Tea Dragon Society by Katie O’Neill yesterday and it was tots adorbs.

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What I’m listening to

I listened to this & other live recordings of Khruangbin (krung-bin) while writing today. They bring the funk and mellow vibes – very old school. I’d love to see them live.

I was also turned on to The Bombpops this week by Kevin Gentilcore – 90s pop punk is alive & well!

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That’s all folks!

What do you think of Patreon’s long-term viability?

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