Most of us will support a creator, artist, or community builder in our lifetime. Why do we choose to spend our hard earned money this way?

Take a quick look at the tweet below from The Yard, a successful creator podcast from Ludwig and friends that generates >$200K a month.

What motivations do you think they appeal to? We’ll come back to this later.

Over the past decade, I’ve worked on numerous products that enable community building and fan funding. Through observing hundreds of communities, I’ve found four primary motivations that drive fans to support and financially contribute to their favorite creators.

1. Recognition & status

2. Access (e.g. to content, community, attention)

3. Identity & expression

4. Tangible value

Recognition & status

Fans want to be seen and elevated above the crowd for their contributions. It is easy to see why this is the most commonly desired benefit that incentivize fans to support creators.

Creators and community leaders dole out recognition in numerous ways, some examples are:

• Status symbols — Creators can assign special roles to their supporters on platforms like Discord. These often come with unique colors or badges that help supporters stand out in the community. Symbols can be further differentiated based on how much the fan contributed or how long they’ve been a supporter.

  

• Shoutouts — Creators take time in their live stream or VOD to thank supporters for making it all possible. This can be a simple mention of their username, or a more personalized thank you message to acknowledge supporters’ contribution.

  

• Leaderboards - A public display of the top supporters, ranked by contributions or engagement within a community. Giving an elevated presence to the most active and generous supporters.

Creators also pull on a few levers to vary the recognition they give.

• Consistency — How reliably do fans feel they are recognized and elevated for supporting the creator? e.g. Recognizing one person but not another for the same contribution can lead fans to perceive things as inconsistent, or even unfair.

• Immediacy — How quickly do fans feel a sense of recognition and status after they support the creator? e.g. A live streamer can respond to fan support actions in real-time to immediately reinforce that action, which also incentivizes other viewers to do the same.

• Magnitude — How significant is the recognition / status that fans are rewarded when they support the creator? e.g. Creators tailor the status they give based on the contribution. $1 may get a “thank you” from the creator, while $500 may result in a happy dance, a heartfelt appreciation speech, a VIP role in the community, and a 30 sec recognition segment in the next video upload.

• Frequency — How often are fans rewarded with the recognition and status from creators? e.g. A daily video poster has an opportunity each day to recognize their supporters in their content. A monthly newsletter writer doesn’t have the same option to recognize supporters within content as frequently.

Access

Desiring access implies that people want more from creators beyond their content. Why is that?

Creators represent “goals”, something fans aspire to be / have. Fans may also value creators’ skills / knowledge because they need that skill set to reach their own goals.

For these fans, free content from creators is not enough to satisfy their curiosity and personal goals. They want deep dives, exclusive insights, interactive discussions with other fans, and more.

That’s a lot to ask for! But they’re willing to pay, which is good since it can be costly for creators to offer additional access.

Today, creators offer access in a variety of ways:

• Content — This includes unreleased, bonus, or behind the scenes material. This could also be drafts of written work, earlier versions of songs or videos, or archived content not available to the public. Creators also offer extensive course content that dives deeper into topics that is covered at a surface level in free content. For creators, the lowest effort version of content access is to offer an early preview of content that will eventually be available publicly.

• Community — Creators might set up exclusive spaces for fans to connect on a community platform such as Discord. These spaces allow for more intimate and direct conversations. Additionally, while fans may be drawn to a community because of a creator, a long term benefit is fostering meaningful connections with each other. You’ll know the community is thriving when rituals (shared repeated activities that feel like “play”) emerge that members run on their own.

• Attention — Every interaction requires creators to give unscalable attention / time. That can be a big opportunity cost. If they deem it worthwhile to offer unscalable interactions, creators may offer private Q&As, messaging, and other forms of small group / individual interactions. Some creators even tap into commissioned videos as a way to earn. These options are not for every creator, but these experiences can provide fans with a memorable experience that truly acknowledges their support.

  

  Most commonly, creators give access to attention by responding to a few fan comments. Then there’s Taylor Swift, who jumped at the opportunity to chat with fans for two hours ahead of her music video premiere.

• Co-creation — Super fans can be given the opportunity to influence the creator's work. This means access to exclusive surveys, polls, or brainstorming sessions with supporters, allowing them to have a say in upcoming content or projects.

Identity & expression

People have a basic need for social belonging. In communities, part of belonging is being perceived positively by other community members.

This is why fans want to establish a connection to others in a creator community; because there is significance behind their acknowledgement and approval.

So fans endeavor to signal to the tribe: “I am one of you!” To do so, they associate themselves with values / symbols that are known and appreciated by others in the group. Creators facilitate this in a few different ways:

• Shared lexicon — Creators often indoctrinate shared language that are used to identify as part of a herd. This can be a greeting, verbal/written slang, or a name that an entire fandom proudly associates with. By gating the explicit association to valuable lexicon, creators can incentivize support (e.g. some titles are bestowed only to supporters, OR members are greeted with a certain phrase only if they are a financial supporter).

• Symbols — Emojis and animated sticker are popular visual expression tools for all modern consumers. Creators often create custom emojis and stickers that only paid supporters can use. Gaining access to emojis is a very common reason for people to subscribe to Twitch streamers. The combination of exclusivity and being a meaningful symbol means custom emojis can be highly valued.

  

• Inside Memes — Similar to symbols, memes are often born in strong community settings. Meme are modern hieroglyphics packed with unspoken reference to something that others can understand and relate to. Arguably, memes can be the most densely packed communication medium, and they are infinitely re-mixable with templates. To entice direct fan support, creators can offer exclusive templates for creating memes that reference “inside” stories from the community that fans fondly gravitate toward.

• Branded merchandise — Whether clothes and bags, or stickers and digital items, creators want their fans to be walking billboards where ever they go (and to look good doing it). What we wear is an extension of who we are and a projection of our values. In the same way that sports fans rock their favorite player’s jersey, fans don their favorite creator’s apparel as a show of fandom.

  

Note: Creators who want fame will want these expressions tools (often featuring their face) to be widely used. If fame is the only thing creators want to optimize for, then there is clear drawback to making expression tools “paid only”.

Tangible value

We are all consumers. Naturally, when we buy something, we want to feel like we are getting a good deal. This is why many creators try to bundle their subscription offering with other perks: to create more value for their paid supporters.

While fans care immensely about recognition, access, and identity, tangible value refers to the set of benefits that users could readily assign a dollar value to.

• Merchandise pre-orders — If creators have enough demand for their merch that they get sold out, then clearly there is value in guaranteed access or pre-ordering. This rewards the biggest fans with limited-edition or high-demand items.

• Discounted / free goods — Creator can offer subscriber-only discounts on other goods, which are effectively discounted bundles. Similarly, creators offer free trials on services, usually in partnership with brands.

• Surprise gifts / mementos — Crafts and handwritten postcards / letters, which can be viewed as exclusive collectibles.

• Raffle / giveaway — When creators organize merch raffles, paid subscribers can have a higher chance to win limited edition items and collectibles. This creates excitement for all, and gets more fans to consider becoming subscribers.

  

• Ad-Free Experience — If this is offered, it’s offered by platforms. By providing subscribers with an ad-free experience, it appeals to consumers’ desire for a better experience when browsing and consuming content.

What about altruism?

On the surface, it looks like sometimes people contribute without expecting anything back. There are plenty of stories of anonymous donations for hundreds of dollars for artists and streamers.

However, donors are not doing so out of the goodness of their hearts. These acts of support happen because fans want to see the creator continue to produce valuable content for their consumption.

These fan actions are rooted in a few factors:

1. They perceive value from the creator’s past content.

2. They like the creator and what they stand for.

3. They feel the creator needs the help with financial support.

In other words, donors are back-paying for value they have received in the past. They are also expecting to receive similar such value in the future. In lieu of these factors, fans are unlikely to financially support a creator through donations.

The Yard

Let’s return to that tweet from The Yard.

It is clear that they lean into many key motivations, with a skew toward offering access to content, community, and attention.

By combining killer content and a host of perks that fans care about, these creators have grown The Yard into one of the most successful creator podcast ever.

Wrap up

In the future, even more creators will want to earn via direct fan contribution from an engaged fanbase. For these creators, simply publishing content will not be sufficient.

To motivate fans to support them, creators will need to offer more than widely available content. They will need to figure what they can offer in terms of status, access, identity & expression, and tangible value.

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Top creators earn significantly more than average creators. What sets them apart from the rest?

These key habits help top creators succeed in a highly competitive field.

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

This is part 7 — Enjoy the process.

Enjoy the process

Even the best creators have a fear of hitting of publish on their content. No one is immune to the anxiety of not knowing whether people will appreciate the work that they’ve put a ton of effort and time into.

Despite that, successful creators go through their process and release their work regularly. They shift their focus from the outputs they can’t control (likes, views, follows) to the inputs they can control (creating regularly, noting ideas down every day, engaging with posts from other creators each week).

To link this back to habit #1 (consistent production), creators need to stick to their process for a long time to see their efforts yield compounding results.

This process can be mundane, but creators use a few neat tricks to make the process tolerable, even enjoyable.

Find flow through excited accountability

Flow is a magical state we’ve all experienced at some point in our lives. It’s the perfect balance of challenging and fun that makes for an engrossing experience we can singularly focus on and enjoy.

So how do creators consistently get themselves into a state of flow?

The answer is excited accountability.

First, you have to be intrinsically interested in the skill you are about to build, or the thing you set out to do. That gives you excitement.

Second, you need adequate external pressure such that not following through would cause embarrassment you really want to avoid. That gives you accountability.

You've probably seen this in practice. Creators declare their intentions to do something new, and outside of their comfort zone. This forces a sense of accountability onto themselves, because they don’t want to go back on their word, which would jeopardize trust from their audience.

Carrot and stick system

It feels oddly childish to set rewards and punishments for ourselves, but it’s awesome to leverage positive / negative reinforcement to create habits that benefit us.

This will only work if you are targeting something that you have deep intrinsic motivation to pursue. Otherwise, you will lose interest and quickly drop the whole thing, rather than habituating the behavior you want.

If you decide to set up a rewards / punishment system, here are a few suggestions:

1. The bar for rewards should be high, and achieving that bar cannot be gamed

2. The punishment should be consistent, painful (within reason), and swift

3. The system should be iterated on over time if it becomes less effective

4. Rewards / punishment should suffice even if they are private, because they are meaningful to you personally

Note: It’s also important to keep in mind that in practice, feedback for continued improvement is much more important than the rewards and punishments themselves.

Keep showing up. Slow and steady wins the race

In investing, fast and steady money does not exist.

In weight loss, the faster you lose weight, the faster you gain it back.

This similar concept applies to creators. Rarely do creator blow up overnight and maintain that level of fame in perpetuity.

The creators who become and remain relevant are those who show up day after day, build foundational skills, and nurture a community of peers and fans steadily. Only eventually will they reap the compound rewards of their continuous effort.

There is only one way to get there, and that’s consistent hard work.

Consistent hard work doesn’t mean operating at maximum intensity all the time. But it does mean showing up even when you don’t feel like it.

“If we wait for the moment when everything, absolutely everything is ready, we shall never begin.” ― Ivan Turgenev

Sooner or later, all of us will be tempted to skip out on our process, to slack off for a day. But a day can easily turn into a week, a month, and so on. Successful people, creators or otherwise, show up consistently whether they feel like it or not.

This applies to all of us. From time to time, we have to be gritty and persistent when our motivations are low. Just remember: No one regrets doing meaningful work.

Acknowledge your progress

Seeing and internalizing progress is more motivating than most extrinsic rewards.

Dan Ariely ran an experiment in 2005 that showed the effect of meaning (proxied by visible progress) on people’s motivation to do work.

The experiment split out the test subjects into two groups who were asked to perform the same task: assemble Lego figurines.

Group one saw their figurines dismantled as soon as they were built. Group two placed each completed figurine on a desk before continuing to the next one.

The results were clear as day: Group two, which saw a visible reminder of their progress and achievement, out-built Group one, 11 to 7.

Despite the fact that the wage and the task are identical across the conditions in each experiment, subjects in the less meaningful conditions [consistently wanted higher wages] than the subjects in the more meaningful conditions.

The result replicates across different types of tasks. Moreover, in the more meaningful conditions, subjects’ productivity influences labor supply more strongly.

Seeing progress boosts performance. Even the illusion of progress (often seen as the buy 10 get 1 free) spurs motivation.

This works on each of us, and it works regardless of how small our progress may feel. Remember, the more advanced you are, the harder it will be to make progress.

• A world class sprinter knows the value of 0:001 seconds.

• A NFL running back knows the value of 0.2 yards.

• A professional fighter knows the value of 0.5 lbs.

Sometimes the progress is nearly invisible, other times it’s night and day — MrBeast was a totally different creator 5 years ago. And you can bet he’s celebrating the incredible progress he has made since then.

To recap — whether it’s the world’s most successful creators, or one of us, building a process we enjoy is an important part of succeeding sustainably.

We can make our process more enjoyable by:

• Finding flow through excited accountability

• Creating systems that reinforce behaviors with carrots and sticks

• Continuing to show up over long periods of time, even when we don’t feel like it

• Acknowledging our progress, however big or small they are

That wraps it up for this series on the 7 habits of successful creators! Hope you took away something valuable and applicable :)

If you have questions and thoughts, leave a comment below, or Tweet at me.

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Top creators earn significantly more than average creators. What sets top creators apart from the rest?

These key habits help creators succeed in a very competitive field.

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

This is part 6 — Embrace different mediums.

Embrace different mediums

Creators entertain, inspire, and inform the world through content and storytelling. They do so through various “mediums” — tools and formats for content creation and distribution.

Today, creators are flocking to TikTok, Reels, and YouTube Shorts as a medium.

It feels like a gold rush moment.

Who can blame them? Big numbers are shoved in our faces every day — “Creator X has 3M followers, and their videos have 200M views in just 1 year!”

But FOMO could lead many to making costly mistakes. Why is that?

Different mediums let creators get their message across uniquely. This is akin to an artist having a broader color palette and diverse materials (e.g. oil, watercolor, acrylic, charcoal). Choosing the wrong tool will diminish the impact of the artist’s work.

So just pick the right medium. Easy peasy?

Which medium is right for creators?

While early (pre-2000) content creators were extremely constrained on mediums, creators in 2023 have an abundance of options:

1. Text-based: Blog posts, articles, books, and other written content.

2. Audio: Podcasts, audio recordings, live audio stages (e.g. Clubhouse), and music.

3. Video: Long/short form videos, movies, and television shows.

4. Visual: Photographs, illustrations, animations, infographics, memes.

5. Interactive content: Games, quizzes, polls, choo-your-own-adventure paradigms that allow users to interact with the material.

6. Events: Conferences, webinars, live streams where people engage with each other.

7. Virtual reality (VR) or augmented reality (AR): Immersive experiences to create a sense of presence in a simulated or augmented environment.

It turns out having too many options is a challenge itself.

Smart creators evaluate a number of factors to decide their format, distribution platform, and potential revenue strategy.

For instance, creators considering videos as a format might lay out the following to decide how specifically they will invest in video content.

By laying out trade considerations, it becomes clear that depending on the creators’ content and goals, short form video might be a terrible option to invest in!

Clearly, this can be a useful exercise.

However, creators who start with this exercise without publishing anything may get stuck in analysis paralysis.

Realistically, it’s better to just get going on something based on gut instinct. Creators can develop this intuition by asking themselves:

• Where do my customers hang out?

• Where could I uniquely stand out?

• Where do I personally enjoy spending time online?

• What creation processes are aligned to my strengths? What can I stick to even when it’s not fun?

Embrace different mediums, but not at once

There are lots of examples of established creators who leverage multiple content formats and platforms to build their media and business empire.

• Casey Neistat: Filmmaker, writer, and story telling master who creates a videos, articles, and podcasts.

• Gary Vaynerchuk: Business and marketing guy who produces videos, podcasts, articles, Q&As, NFTs.

• Tim Ferris: Author, podcaster, and entrepreneur who has published books, articles, podcasts, and online courses.

• Humble the Poet: Poet, artist, and author who creates videos, podcasts, and other social media content.

• Ramit Sethi: Personal finance expert who produces content in the form of books, articles, podcasts, newsletters, and online courses.

While it’s tempting to look at a streamlined portfolio of content publishing, it would be a fatal mistake to emulate them without adequate resources and a team.

There's nothing wrong with trying multiple mediums. But it doubles or triples the workload to try several simultaneously, which makes it harder to publish consistently.

All in all, signing up for too much work is a recipe for burnout and disappointment. This is especially true for aspiring creators thinking about publishing content on multiple platforms to grow an audience.

To grow an engaged audience on any platform, there is a ton of invisible work beyond simply publishing great content. This includes interacting with viewers, nurturing relationships with other creators, and honing your content and voice to deliver more value to audiences.

Therefore, it is more advisable is to focus on 1 (maybe 2) distribution channels for your content medium of choice.

Medium matters for brands and businesses

Bonus story. On Jan 26, 2023, Midjourney became the first Discord server with 10M+ members. (Disclosure: I work at Discord)

I share this as an example of a business whose customer facing UI was bootstrapped entirely on Discord (the medium), rather than its own web or mobile app.🤯

Midjourney is not a creator, it doesn’t produce content.

It is an AI image generation tool. When people enter text prompts and parameters, Midjourney’s ML algorithm takes that text input, and produces unique images based on a massive amount of image data it has been trained on.

Rather than choosing to build their own medium (e.g. a mobile app) that requires design / engineering work and technical infrastructure, Midjourney leveraged Discord as a platform. This let people find and experience Midjourney all in one place, where they were already hanging out with friends and communities.

It took off like a rocket ship, partly because of Discord as a community medium.

Discord is made for shared, interactive experiences. And Midjourney’s founder, David Holz, knew instinctively that watching and learning how others use Midjourney would be the best way to onboard anyone who stumbled into it.

This drastically accelerated Midjourney’s launch, and its rise in popular culture.

To recap, different mediums help creators reach new audiences, and express themselves in unique and effective ways. Creators:

1. Consider key trade offs between different formats, distribution platforms, and potential revenue strategies.

2. Answer key questions about themselves and their target audience, and use intuition to pick a starting place.

3. Focus on 1 (max 2) distribution platform to make room for audience interaction and relationship building with other creators, without burning out.

Which mediums appeal most to you as a creator or consumer, and why? If you have questions and thoughts, leave a comment below, or Tweet at me.

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Dear subscribers,

Top creators earn significantly more than average creators. But what sets top creators apart from the rest? What can we learn from them?

The best creators have adopted several key habits that improve their odds of success in an extremely competitive field.

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

This is part 5 — Creating is combining.

Creating is combining

Successful creators arrive at their best work by combining in 3 primary ways: copying / transforming, assembling building blocks, and collaborating with others.

1. Copying / Transforming

As David Murray says in Borrowing Brilliance: "First you copy, then you create. All brilliance is borrowed."

What may seem at first to be novel ideas are always constructed out of existing ones. Original ideas are those that combine part of one existing idea with parts of another. The end result is something that has never been presented or combined in that way, therefore original.

Copying and transforming necessarily precedes combining. Only by having a solid grasp of the fundamentals can we successfully join ideas together in a cohesive way.

Copy: No one starts out original. We cannot create anything new until we have a solid foundation of knowledge and understanding in our line of work. Copying is how we learn.

Transform: Taking an idea and creating variations. Major advances are usually not original ideas, but the breaking point in a long history of progress by many different individuals.

- Kirby Ferguson

Every craftsman and creator also starts by copying, and only some of them will ever move on to transforming.

Transforming requires a certain level of mastery. When they get there, creators are able to add their own sense of style to slightly evolve the source material. Cover songs, fan fiction, and cosplay come to mind when it comes to transforming.

As an example: Millions of people have played and collected Pokémon cards. Everyone has drawn as a kid, and many people still do as adults.

However, Lunumbra was among the first to transform Pokémon cards by painting over them. Specifically, they extended the background in the cards to make the environment fully immersive. They captured this as content, overlayed the video with lo-fi music, and created viral content that drew in Pokémon fans from every corner of the world.

This also resulted in commercial success as Lunumbra racked up 215K followers on Instagram, along with a constant demand for paid commissions.

2. Assembling building blocks

When creators go beyond transforming, they begin putting together pieces from different sources. Often, this expand beyond a single domain to incorporate the best inspirations from multiple categories.

Effective creators assemble building blocks together perfectly to create magical experiences that feel fresh and “new”.

As an example: Interviewing is a very frequently seen concept for video creators and podcasters. VTubers (Virtual YouTubers) are a commonplace tool for creators to use an avatar to represent themselves in content. Audience interactive elements are bread and butter for all live streamers.

But these concepts remained largely segregated until CodeMiko wired up a 3D character rig, programmed a viewer interactivity model that lets the audience do stuff to her character and environment via chat messages, and parlayed the hype from her entertainment value to get interviews with dozens of popular creators.

By combining these concepts, she formed one of the most entertaining and most popular VTubers on the internet. Congrats to her on winning VTuber of the year!

Assembling can feel like coming up with new winning formulas, which takes creativity, skill, and luck. But the base act of putting pieces together is getting easier every day — a bit more on this later.

3. Collaborating with others

Creators are leaning into collaboration more than ever: TikTokers and Live Streamers are living in shared houses to jam on ideas and content. Podcasters and bloggers are inviting other creators to be featured guests on their shows. Emerging creators are joining forces in talk shows featuring ~10 people.

They do these things because great collaboration is a positive-sum endeavor. Creators that complement each other, inspire one another, and vibe together will make magic happen. Through collaborating, creators learn from each other, push themselves to be better, and combine their talents to make something greater than the sum of its parts.

The practical angle is that no matter how talented creators are, it's impossible to master every skill. And since creators need skills beyond their own capability, they have to work with others to achieve success.

Collaboration is also important because it has the potential to increase reach and visibility. When creators team up with other creators, they tap into new networks and audiences, exposing themselves to new people. This can be especially valuable for creators who are just starting to build a following.

There are plenty of examples of great collaborations, Still D.R.E. is one such example. It has a mind boggling 1.2 billion views today, and exemplifies how musicians work together to make hits that neither could make on their own. You may not know that both Dre and Snoop’s lyrics in this song were written by a young Jay-Z. Collaborating with others elevates the recognition of your work among peers, which played a significant role in Jay-Z’s career.

A note on creating / assembling with AI

I’m sure you’ve all seen or heard the waves being made by impressive generative art AI (Stable Diffusion, Midjourney) and conversational AI (ChatGPT). They are causing as much excitement as anxiety.

The good news and bad news are the same: We’re going to see an explosion of new creators generating a huge volume of “new” work. IMO, as they are today, these AI tools are simply powerful tools. They can enhance how we create, but they cannot replace the best human creators. Three thoughts here:

1. AI falls short on out-of-the-box (beyond training data) creativity and emotional intelligence. AI is great at analyzing data and performing tasks with a high degree of accuracy, but it is hard constrained by the data that goes in.

2. Human creators are able to tap into their own experiences and emotions to create relatable, resonant works of art. This means that when it comes to creating compelling content with a human’s experience and perspective in mind, AI cannot compete with human creators.

3. The creative process is a human one. The struggle of putting down an idea and molding it into a compelling form is an iterative expression of individuality. To create collaboratively further amplifies the need for a human touch. Even if AI produces technically impressive content, it lacks the human element that is essential for amazing art that can be fully appreciated by people.

The ability to think outside the box, to connect with an audience on an emotional level, and to express individuality are all uniquely human qualities. While AI tools can copy very efficiently, the human aspects of transforming, assembling and collaborating are the exclusive territory of human creators.

What creative combinations and remixes have you seen from creators? What do you think of AI’s potential to replace human creators? Let me know in a comment below, or on Twitter.

P.S. It’s been a while since my last post! I’ve been busy building Server Subscriptions, which is currently available for community builders and creators in the U.S. If you run a community that provides value directly to members, now you can earn from it right on Discord :)

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Dear subscribers,

The power law, which results in a few winners who extract the majority of value in an ecosystem, is all around us. This pattern can be seen in music, sports, business, and just about every other arena.

So as you might expect, top creators earn significantly more than average creators. But what sets top creators apart from the rest? What can we learn from them?

Top creators have adopted several key habits that improve their odds of success in an extremely competitive field.

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

This is part 4 — Scaling output: What does it mean, and how do creators do this?

Scaling output

What does it mean? Why does it matter?

For creators, scaling effectively means producing greater output without proportionately increasing personal input (i.e. time, effort).

This is important for creators, who tend to be perfectionists about their craft. Passion is great, but constantly striving for perfection without improving how they work can lead creators to burnout.

Many creators start out loving their lifestyle, but grow to despise their it because they never figure out how to scale. Doing so is the only way to have longevity as a creator.

How do creators scale their output?

Repeatable creation system

A repeatable, systematic approach to content creation lowers the effort to create.

Just like a blank page can be intimidating to writers, starting the make the next piece of content can be daunting to creators. Successful creators deconstruct this scary process into smaller parts, making it much more manageable.

Every creator has their own system, but generally it consists of ways to capture inspiration, filter ideas, write out a script (or equivalent), get feedback/iterate, shoot the content, edit, publish, and amplify.

If creators systemize these steps and improve their efficiency over time, then effort is lowered while relative output is increased.

An added benefit of a system is that creators can more easily debug or optimize their workflow, by identifying what systemic errors and inefficiencies to solve.

Hire experts → Fire themselves

Hiring experts (e.g. editors, mods, graphic artists, analysts) and setting them up for success with process and guidance is a way to achieve great linear scaling for a creator.

To do this well, creators need a repeatable creation system, through which they’ve broken down their big picture process, and clarified the way they make decisions.

This is because creators have high standards for their output, and to trust another human with producing part of their output is scary. There needs to be shared values, alignment on a framework, and a common understanding of what good looks like.

This is much easier to achieve through repeatable processes that can be understood and executed by a reasonably skilled person. On the other hand, if the process is so prescriptive that it stifles creativity, it’s counterproductive in this context. The process should simply set guardrails and expectations so that creators can delegate work without compromising quality.

A common mistake for creators is hiring experts, and yet never firing themselves from those jobs. Creators will bring someone onboard to help, but never really hand things off. Janae Thompson shares an example, where her late husband Grant struggles with this even after growing The King of Random to millions of subscribers. When this happens, creators need to reassess and fix the misalignment, otherwise burnout is a likely long-term outcome.

Co-creation with community & other creators

Successful creators opportunistically leverage and collaborate with others. We’ve all seen them — Interviews, guest post, creator game shows, and even content made entirely of community interactions (e.g. Lenny posts conversations from his private newsletter community in Community Wisdom).

Lenny's Newsletter

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4 years ago · 13 likes · Kiyani

When creators remove themselves as the bottleneck for creativity, they open a new world of possibility. Effectively co-creating allows creators to increase output at quadratic or even exponential scale.

• Mobilizing a community for knowledge, feedback, and word of mouth can produce greater output than on their own.

• Collaborating well with others lets creators grow faster by extending their reach, cross-pollinating ideas, and connecting with a new but relevant audience.

Re-purpose

Creators over-capture content, and whittle it down from there. The traditional way is to edit it down to a polished YouTube video, hit publish, and trash the rest.

In 2022, that is a terrible waste! With numerous mediums, formats, each catering to a slightly different group of people and use case, it is We’ll talk about this in greater depth next time.

Closing thoughts

Being a creator is rewarding but can be exhausting. Burnout is an affliction that affects many creators. To make this lifestyle sustainable, creators need to scale themselves.

Successful creators do so by establishing a repeatable creation system, forming healthy working partnerships with others, and co-creating with fans and other creators.

By scaling themselves, creators attain the freedom to choose how they spend their time, to preserve more balance in their lives, and to focus on delivering unique value in ways only they can.

What have you seen savvy creators do to scale themselves? Let me know in a comment below, or on Twitter.

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Dear subscribers,

The power law, which results in a small number of winners who extract the majority of value in an ecosystem, is all around us. This pattern can be seen in music, sports, business, and just about every other arena.

So as you might expect, top creators earn significantly more than average creators. But what sets top creators apart from the rest? What can we learn from them?

Top creators have adopted 7 key habits that improve their odds of success in an extremely competitive field.

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

This is part 3 of the series — Know your audience: What does this mean, how do creators achieve it, and what do they do with this knowledge?

Know the audience

What does it mean to know your audience?

It’s one thing to recognize someone by their username, but truly knowing the audience is completely different.

When successful creators talk about their audience, they can give a shocking level of detail about the people they make content for.

“My audience is early on in their career, and they find me when they’re desperately seeking career advice.”

“My viewers skew older and more female, lots are moms with busy morning schedules. They tend not to be the most tech savvy, are scattered across NA/EU.”

“The most engaged people in my community need a lot of attention. They have trauma or scars from their past. They want someone to talk to and be heard. They’re willing to pay, some even offered me money to have 1:1s with them.“

More than just audience demographics, creators often know the blunt truth about their audience’s state of mind, gaps in their human needs, and their core motivations for consuming certain content.

Great creators know their audience to the extent that they can more accurately predict what topics, what language, and what visuals will work better. They can guess the types of questions and reactions people will have for their content. In other words, it makes them better creators.

How do creators get to know their audience?

Analytics

Creators are getting more data savvy when it comes to their audience, and platforms are giving them the tools to get a deeper understanding of who they create for.

For instance, YouTube analytics provides YouTube creators with a treasure trove of information about their viewers.

Creators slice the data to see big picture trends and find deeper insights. Common things creators look for include where users find their videos (e.g. search, home, watch next, explore, channel, subscriptions), whether they’re returning or new viewers, where people tune in from, viewer demographics, and even what time of day those viewers tend to be on YouTube (i.e. useful for planning live streams and premieres).

Listening

If a creator says or does something that resonates with people or touches a nerve, people will voice their support (or disagreement).

Creators pay attention to this feedback because it gives them an indication of what connects with their audience in different ways. They use this feedback to calibrate, and build up an intuition on what works and what doesn’t.

Live streamers have perhaps the tightest feedback loop on these interactions. With tools such as Live Polling, creators can ask a question and get an immediate sense on what their viewers think about a certain topic.

Over time, people will also share their own stories, or ask the creator for personal advice. This further deepens a creator’s understanding about the specifics behind their viewers’ interests, their continued support, and their struggles.

Note: For an established creator who gets thousands of comments every day, it is probably not a good idea (or even possible) to reply to each one. But for aspiring creators, it can be valuable to address literally every meaningful comment. Small live streamers have some of the strongest connections with their audience, and it’s in part because they acknowledge and answer every chat message they get.

Shared experiences

Knowing an audience is sometimes not about demographic/psychographics, or any particular question / comment. It’s often intangible, such as understanding how people prefer to interact with others, or how something will make the audience feel.

There are no short cuts with this. The only way creators build up this intuition is to go through shared experiences with their community over sustained periods of time. Importantly, successful creators recognize that building an audience vs. having shared experiences happen in very different places.

These experiences results in common history, a sense of community, and mutual understanding. According to research, in a “team” setting, this allows people to predict each other’s actions, and provide relevant information before being asked.

The more time people spend together, the more easily they can recognize each other’s tendencies and needs. By immersing themselves in the community, creators get meaningfully deeper empathy with the members of their audience.

What do creators do with this knowledge?

Knowing the audience gives creators a mental model of who they’re making content for, and who they’re nurturing a community for. So how do they make use of this info?

In content

Studying audience data can also give creators insight on which topic or content format people are interested in. For example:

By looking at this data, a creator can conclude that a live stream they did on Nov 11, 2020 reached lots of new viewers — people who saw their content for the first time.

If the creator wants to grow their audience, perhaps they can dig into what this live stream was about, how people discovered it, and where the viewers came from. In short, they can find what gets results, and double down on those insights.

Creators can also study the comments and common questions from their audience (or audience of other creators) to get a sense of what topics are interesting, and identify the gaps between existing content and people’s never changing needs.

These signals lead creators to effective topics / themes, and lets them modify their content to pre-empt questions, making their content more relevant and complete.

In community

Content analytics help creators understand content performance and people’s behavior in the context of content consumption.

Community analytics help creators understand community performance and people’s behavior in the context of community interactions.

What “good” community analytics look like will be a separate post. The takeaway for now is that ideally, creators who study community analytics should gain a deep understanding of their community, including the following:

• Who are my most loyal, engaged, and valuable community members?

• How healthy is my community for different member segments?

• What do members talk about? Where / how do these conversations get started?

• How do members of my community like to spend time together?

• How does my participation or content lead to community engagement?

• What about my community attracts or repels people?

• Why do people leave my community?

Creators can then make informed decisions on what activities or conversations to introduce in their communities, which community members to recognize and elevate, and how to keep different segments of their community engaged.

Closing thoughts

Creators study analytics, listen to qualitative feedback, and live shared experience with their communities to get to know them.

With this knowledge, creators calibrate their understanding of what is valuable and relevant. This lets creators fine tune their content and community interactions, which drives toward their goals and meets the needs of their audience / community.

Whether or not you’re a “creator”, each of us has an audience in some context, and what you know about that audience can make or break your success (e.g. nailing a work presentation, making a good impression with a partner’s parents, landing a term sheet with an investor).

So look for ways you can better understand your audience, and tweak your behavior accordingly to achieve your goals.

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Dear subscribers,

The power law, which results in a small number of winners who extract the majority of value in an ecosystem, is all around us. This pattern can be seen in music, sports, business, and just about every other arena.

So as you might expect, top creators earn significantly more than average creators. But what sets top creators apart from the rest? What can we learn from them?

Top creators have adopted 7 key habits that improve their odds of success in an extremely competitive field.

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

This is part 2 of this series — Sweat the right details: What does it mean, why you should care, and what are the “right” details to pay attention to?

Sweat the right details

What does it mean to sweat the details?

Sweating the details means taking the effort to ensure that certain key attributes of a product (or content / experience) exceed expectations. If done right, this will deliver unexpected surprise and delight, even if most people can’t place their finger on why.

It’s the hundreds of slightly varied voice-acted grunts in Super Smash Bros.

It’s the sparkles / celebratory fanfare you get after performing a high-value action in a software product.

It’s the easter egg hidden in a movie that references canonical lore.

It’s the hand-written “thank you” note you receive after helping someone.

It’s the way Apple packages their Watch product with matching border radius and shapes across the instructions insert, the wrapper around the paper, the watch face on the paper, and the actual watch face.

These things do not happen by accident.

Why you should care about details

Details lead to excellence (and perception of excellence)

Humans are evolutionarily wired to make snap decisions. If a customer notices lots of small mistakes, it can make them question whether you can be trusted with big things. Take care of the details, and you’re more likely to be perceived as someone who can be relied upon to know their shit.

In a corporate environment, many hiring managers who will toss out resumes that have even one typo. Their thinking is: “If you can’t be bothered to proofread the one document that represents you to a potential employer, how can you be trusted to take care with customers when you’re actually on the job?”

For video creators, many times their lighting and set up contributes to how viewers perceive their video’s “quality”. The detail of how creators utilize a combination of key light, fill light, and rim light leads to different viewing experiences. While “quality” is a subjective measure in this context, it nonetheless plays a role in getting viewers to perceive creators as professional and credible.

Small details add up to the big picture

John Wooden led the UCLA basketball team to win 10 NCAA championship titles. Each year, at the first meeting with the team, Wooden would take the first few minutes to personally instruct players on how to put on their socks and shoes.

He would hold up a sock and put it on his own foot, showing the team how to smooth it out, ensuring there are no wrinkles around the little toe and heel areas. He would carefully demonstrate how a shoe should be laced, and how they must be tightened up snugly by each eyelet, tied, and then double-tied, so that it doesn’t come undone during practice or a match.

Wooden believed that these details, which are within the team’s control, are the key building blocks of success. They are the little things that lead to big outcomes. These actions helped the team to reduce blisters, minimize unforced errors, and build a daily habit of paying attention to meaningful details.

Details stir up emotions and move people to action

When you take the time to think ahead for your customers / audience, it manifests in the way they experience and react to your product. This is as true for unboxing a new toy as it is for an existing software user running into a rare edge case.

Twitter took care to account for the scenario where users lose internet connectivity while drafting a Tweet or DM. This minor feature lets users copy the message to their clipboard to send later. This gives users a sense of relief; the alternative could have been losing a long message without warning, leaving users frustrated and angry.

Creators take opportunities to perfect the numerous ways they interact with their community members. Sometimes, this is before the “featured content” is ever shown.

Seagull, a former Overwatch League player and Twitch streamer, utilized software to show a procedurally generated “battle-royale” sequence among his paid subscribers before his live steam starts.

This clever detail gives viewers a sense of delight, anticipation, and excitement (who’s going to win??). It elicits loyalty from paid subscribers (my name is showing up on stream!) while garnering curiosity from free viewers (maybe I should Subscribe to get my name on stream).

You can stir up a huge range of emotions when you deliver on the “right” details.

What are the “right” details to care about?

All that said, you’d never get anything done if you took extreme care with every detail in all aspects of your product / content. So how do you selectively pick what to focus on? I recommend assessing based on the potential for details to contribute to high variance impact.

High variance means there’s a wide range of outcomes (good or bad), that have a reasonable probability to occur. Low variance means there’s a limited range of outcomes. Consider the following example.

A course rubric states that homework will account for 5% of students’ final grade, and exams are worth 95% of students’ final grade. Homework and exam prep are mostly non-overlapping, and each will take 20 hours in the school term.

In this scenario, homework is a low variance activity, and exams are a high variance activity. The “right” course of action is for students to disproportionately spend time studying for exams rather than doing homework.

In the context of making product / content, if a detail can make a customer more likely to remember something or perform an action, that’s high variance. For instance:

• Design patterns that help customers successfully complete a purchase

• Education / tool tips that help new users to successfully onboard and activate

• An experience that gets people to tell friends / post on social unprompted

• Typos that completely change the meaning of a sentence

• A story or imagery that helps people recall a lesson (or a brand) consistently

• Empty states / error page experiences that delight users and get them to perform a critical action from there (e.g. make a post)

To sum it up

Sweating details means taking the extra effort to focus on the parts of an end product or experience that result in high variance outcomes.

When the “right” details are taken care of, they help your content / product / brand to be perceived favorably. They can elicit strong emotions from people, and move them to action. Ultimately, little details add up to impact the big picture.

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Dear subscribers,

The power law, which results in a small number of winners who extract the majority of value in an ecosystem, is all around us. Google’s staggering 92% global market share in search (vs. Bing’s 3% market share in 2nd place) is a clear example of this. This pattern can be seen in music, sports, business, and just about every other arena.

Likewise, top creators earn significantly more than average creators. So what sets top creators apart from the rest? What can we learn from them?

Top creators have 7 key habits that improve their odds of success in an extremely competitive field:

1. Consistent production

2. Sweat the right details

3. Know your audience

4. Scaling output

5. Creating is combining

6. Embrace different mediums

7. Enjoy the process

Over the coming weeks/months, I’ll dive into one of these habits in each post, starting today with why and how to produce consistently.

Consistent production

Why produce consistently?

Consistency hones skill faster. Conceptually, most people understand that humans learn fastest by doing. But when it comes down to it, lots of us end up spend hours watching, planning, talking, instead of practicing and doing.

Content creation is not learned on the sidelines (or by consuming), it is learned by doing the creative work over and over.

Successful creators produce consistently. Sometimes they succeed and gain momentum. But more often, they fail and learn how to improve. In any case, they gain valuable experience for tomorrow. Get the reps, and skills will follow.

“Ever tried. Ever failed. No matter. Try Again. Fail again. Fail better.”

— Samuel Beckett

Consistency shows commitment to the craft and to your audience.

When creators stick with a consistent production commitment, it proves to the world (and to themselves) that they will show up when they say they will.

A creator’s habit and commitment can lead to consumer’s habit and commitment. Knowing when a creator will share a new podcast, post a video, or go live will help consumers to reserve time in their busy lives. Staying consistent week after week breeds the kind of trust that lets creators earn loyal audiences.

Twitch’s creator camp calls out consistency as one of the basics for all streamers for good reason. If you consistently show up with valuable content, conversations, and experiences, your audience will thank you and reward you.

Consistency removes “perfection” as an excuse. We’ve all done it. We get inspired and pumped up to do something awesome. And then we wait. We wait for the perfect moment, an ideal window of opportunity where stars align so we can start doing the thing. Before you know it, months pass by and all motivation is gone.

If you wait for the perfect moment, you’ll always be waiting. Don’t agonize over perfection, your creations will never be perfect :) and that’s okay!

When top creators are creating, they don’t fret over every detail. They recognize that consistent progress is more important than attaining perceived perfection. Nearly every successful YouTuber is open with the fact they are unable to accurately predict which videos will be a hit, and which ones will flop.

Consistency leads to quantity — the dirty secret behind quality.

Many world renowned artists are known for a handful of famous works. But throughout their lives, they actually produce dozens (if not thousands) of other works which aren’t as well-regarded. Failure — lots of it — is the mother of success.

• Beethoven: The opening of the 5th symphony. The 6th symphony, and the chorus from the 9th symphony... 800+ musical works

• Shakespeare: Hamlet, Romeo and Juliet… 40+ plays and hundreds of sonnets

• Picasso: Guernica, The Weeping Woman, The Old Guitarist… 50,000+ creations

• Hitchcock: The Birds, Rear Window, Vertigo, Psycho… 65 films, many TV series

We see a similar theme in contemporary examples. Lil Nas X made 4-5 songs a day for several months before creating Old Town Road, which topped the Hot 100 for 19 weeks. Before it got there though, he published countless versions of the song, tweaked melodies, lyrics, and distributed memes and challenges on Twitter, Reddit, and TikTok before the song as we know it today caught fire. Intentional quantity inevitably leads to quality.

In a parable from James Clear, we see how this same concept applies to photography.

Jerry Uelsmann, a professor at the University of Florida, divided his film photography students into two groups.

Group 1 would be graded solely on the amount of work they produced. One hundred photos would rate an A, ninety photos a B, eighty photos a C, and so on.

Group 2 would be graded only on the excellence of their work. They would only need to produce one photo during the semester, but to get an A, it had to be a nearly perfect image.

At the end of the term, he found that all the best photos were produced by Group 1. These students stayed busy taking photos, experimenting with composition and lighting, testing out various methods in the darkroom, and learning from their mistakes. In the process of creating hundreds of photos, they honed their skills.

Meanwhile, Group 2 sat around speculating about perfection. In the end, they had little to show for their efforts, only unverified theories and one mediocre photo.

Consistency is something you control. Bursts of brilliant inspiration are incredible, but these moments aren’t controlled by our actions. What we can control is to make time, show up, and go through the necessary toils to craft something you can share with the world day after day.

This kind of dedication requires sacrifice. Successful creators know that the time they spend creating content will not be spent sleeping in, enjoying their favorite games, or watching that show everyone is talking about.

Nonetheless, they must consider giving these things up to carve out time for creation. Remember: If we consume content 40 hours a week, we’re not part-time creators, we’re full-time consumers.

They always tell me: "Nobody's workin' as hard as you"
And even though I laugh it off, man, it's probably true
'Cause while all of my closest friends out partyin'
I'm just here makin' all the music that they party to

— Drake

How to produce consistently

Note: I’m writing the following from the perspective of creating content, but it can be applied to any challenges we take on.

Break things down. Make impossible tasks possible by deconstructing them into solvable pieces or smaller steps. It may have been daunting for Lil Nas X to “make the number 1 hit song on the Billboard Top 100”, but it was relatively easy and natural to “find a catchy beat”, and go from there.

Focus on one thing. After breaking down your large task into smaller tasks, figure out the first thing you need to do to move toward your goal. Do it today. If it’s not something you can do quickly, write it down and put it where you will see it often, then focus on completing it within a timeline you give yourself — one todo at a time.

Make time. Block off ample time on a regular basis to make progress and go through the struggles of creating. Hold yourself accountable to showing up, and on how you utilize this time. Do not let anything override it. This time is sacred. If you let go of it, you’re gone off track from consistent production.

Commit with consequences. Give yourself a forcing function to stick to your commitment. Willpower runs out quickly and suddenly, so it can be more effective to tie your commitment to an external consequence (e.g. reputation, money, not disappointing an accountability buddy).

Build a system around it. Create the necessary routines, tasks, rewards, repercussions, milestones, and tools to form a self-reinforcing habit. Make the incentives align so that when you do the hard work, you feel rewarded. Make the system simple and repeatable, so that it becomes second nature with time.

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Hi I’m alive.

Apologies for the long hiatus, and thanks to everyone who nagged me to write.🙏

I have been heads down since joining Discord (we’re hiring!). We’ve started piloting Premium Memberships, and there’s much more coming. If you run a community that you’d like to monetize right on Discord, DM me.

Going forward, I’ll be publishing shorter pieces every few weeks. Ok, let’s go!

In this post, I’ll talk about the differences between community and audience, why community matters, and why most creators struggle with it.

To clarify, content will always be an important part of how creators build an audience. That’s not changing. But being great at content is no longer a differentiator, it’s a table stake. The bigger tripping block to success that many creators have to overcome is the transition from building audience to building community.

Community vs. Audience 

To build an audience = Create value through content / service / product that you make directly for consumers.

To build a community = Create value by building the space that facilitates people helping and connecting with one another.

Communities can form around shared interests and topics, or around personalities and groups. In this post I’m primarily talking about those that form around personalities (e.g. content creators).

Community Place vs. Audience Place

Audience places help creators to reach people and help consumers to find content. Creators are in these places to grow a following. Because content distribution is the primary value in these places, creators can make money via ads and brand sponsors here. More or less, this is the primary way creators think about monetizing.

Community places are spaces where people with shared beliefs and norms connect and interact. These spaces revolve around conversations and shared experiences, rather than “views”. As a result, creators can make money via direct value exchange by offering community connection, recognition, expression, and tangible value.

Just as eligible singles wouldn’t build a deep relationship on Tinder, creators wouldn’t build an engaged community on TikTok. TikTok is for content discovery and consumption. It does not truly support people talking to each other.

A community requires a place where people can talk directly to one another, and there are better places for this next phase of relationship building.

• For singles, the chat transitions naturally from Tinder / Coffee Meets Bagel into SMS / messaging apps.

• For creators, the interactions transition naturally from TikTok / YouTube into community spaces such as Discord.

Note: A key difference between community and the dating app analogy is that a community space benefits from network effects, where additional members makes the community more valuable for everyone else.

Why community matters

Scaling themselves

Communities can scale a creator’s efforts. With communities, creators are no longer bottlenecked by their own output, and instead they scale by tapping into the passion, creativity, and resources of a collective.

• Feedback from an engaged community helps creators to learn much faster. Creators run polls, surveys, and small tests on their Discord servers to calibrate and gain early intuition on their content.

• Community members amplify creator voices when there’s a shared purpose. A community with strong allegiance to a creator is far more likely to mobilize and share content / a story. This word-of-mouth is key to creator growth.

• Co-creation is a force multiplier on content production (i.e. potential to lower effort, raise quality, increase output). The best community minded creators use community discussions as collective wisdom to form new ideas, make key decisions, or repurpose conversations as content🧠 (e.g. Lenny’s newsletter).

“A strong community is an extension of [you], and you can further [your goals] by enabling the community to contribute to, and organize around it.”

- David Spinks, author of The Business of Belonging

Meaningful connections

When people join a community centered on a creator they all enjoy, there’s a sense of connection between people, and built-in activity / conversation topics. That’s because:

• They are drawn to the same creator, and likely have some shared values

• Creators make content consistently, so there's a constant stream of "shared experiences" that get people to interact repeatedly. Content drives community.

Doing things together is the essence of being in a community. Over time, members build up strong bonds that manifest in familiarity, recognition, trust, and reputation through their shared history.

Common lexicon (e.g. emojis, slang), implicit references (e.g. memes / inside jokes), and lore emerge over the course of many interactions. These are hallmarks of community, and they strengthen the connections between community members.

Control & Freedom

Compared to content distribution platforms such as Instagram and TikTok, platforms such as Discord and Slack give better control and freedom for community building.

Control:

• Creators set ground rules for how community members conduct themselves.

• Creators organize and decorate the space to fit their community needs.

• Creators provide the value and incentive structures for community members.

Freedom:

• Community removes the burden of catering to “the algorithm”.

• People are reachable in a predictable manner, and there’s flexibility to communicate and interact without concerns about stunting distribution.

• Creators can select among numerous interaction paradigms to engage in kinds of conversations or activities.

Why most creators struggle with community

Time management (sometimes by choice)

Creators have a lot on their plates with content creation (ideating, writing, planning, executing, editing, publishing, promoting, and repurposing).

Community is often perceived as one more task or burden. Some creators make decisions to forego community. This can be a prudent focusing function for many creators who are still figuring out their creative identity and process.

However, creators I’ve spoken with who are further along but do not invest in a community are:

• Stuck on getting started: The thought of starting a community is terrifying. Being responsible for engaging with community members directly is “too much work” for these creators, even if they’d like to try it. (IMO this is lazy and fearful)

• Optimizing only for what they know: “I’m busy making content. That’s working so why not keep doing that?” These creators have something that produces results, and they stick with that. (IMO this is short-term focused, and a trap)

• Consciously designing a journey without community. These creators have assessed where they want to take their creator careers. They’ve made a call to pursue fame and fortune. Their chosen strategy is a large, diffuse audience whose attention will be monetized via ads and brand sponsorships.

Healthy long-term engagement

The skills creators use to create content are not the same as the skills required to run a healthy, engaged community. It takes new muscles (or new people on the team).

There are also differences creators must be aware of in terms of participation.

With content, lurkers contribute comparable value to creators, because they view / like content, which helps content ranking. They watch ads, which helps monetization.

With community, passive lurkers lose value. A video with 5,000 views and 5 comments is fine. A community with 5,000 members and only 5 participants is a ghost town.

To get people participating, the initial momentum comes from creators / moderators who prompt fun interaction. They must do so until the community self-organizes sustainably, otherwise they will need to spark up conversation / activity in perpetuity.

If activity wanes, people are more likely to leave. Communities with a retention problem have an existential crisis. Unfortunately, this is a common problem today. In a survey of 600+ community creators, it’s revealed that the #1 most challenging problem for community leaders is just getting people to show up regularly.

There are more things vying for attention every day. For people to want to engage with a community regularly, it is important for members to make connections amongst themselves, and form habits associated with the community.

Note: Moderation is a separate but related topic that I may write about in the future.

Balancing their own participation

Creators can be the reason people join a community, but they cannot and should not be the only reason people stay.

Creators need to be present to an extent, but they also need to elevate culture bearers that run the show, and be comfortable letting the community grow on its own.

Of course, constant creator involvement is unsustainable. If a creator’s involvement scales linearly with community growth, it is not a durable pattern.

On the other hand, creators who are never present in their own communities are not invested in its success. As expected, these creators typically don’t get significant value from their community.

So should all creators invest in community?

Short answer: It depends on their goals.

Plenty of creators choose not to invest in a community because 1) it takes work, and 2) they don’t ascribe value to having a healthy, engaged community.

Think of it this way: Plenty of people voluntarily stay single forever. Most people never pursue their dreams. It takes work to achieve anything worthwhile. Some go for it, and others put their effort elsewhere. It’s a personal decision, there’s no right or wrong.

However, with any comparable options, consumers tend to choose the one they have a deeper affiliation / relationship / trust with. This extends to how people choose to spend their time, attention, and money. As a result, community will be an immense differentiator for creators in the coming years.

If they choose to put in the effort, creators will see that communities can help them to:

1. Scale themselves

2. Form meaningful connections

3. Gain control and freedom

Thanks to Rick Ling for providing input on an earlier draft.

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Through years of PMing at Twitch and YouTube, I’ve internalized some tacit and explicit knowledge about building products and leading teams. Here are some guiding themes I found helpful in and beyond work.

⌛If you only have 1 minute, skip to the end.

Balance optimizing for efficiency and flexibility.

Management, goal setting, and incentive structures at big companies tend to be short term — e.g. Quarterly OKRs. The measure of success tends to be some % increase in a metric consistent with how the company evaluated success last year.

These are going to be driven by safe and iterative changes, which are mostly efficiency seeking. Great companies balance these incremental improvements with long term efforts that focus on flexibility and adaptability, which come in handy when the market suddenly shifts on you, as it will inevitably.

It is crucial that the part of the company focusing on long term flexibility is allotted room to explore, and not held to the same process and bar in efficiency and error as the part of the company focusing on incremental improvements.

Welcome feedback and seek dissent.

When you have a clear vision of what you want, you naturally don’t want to get derailed with unnecessary distractions and objections.

But great leaders know that getting objective feedback lets you strengthen your thinking. That’s why it’s so important to share with your biggest critics early; they are often your best allies when it comes to developing a stronger plan. Consequently, I’ve found that doing this early means fewer surprises down the road, and results in smoother alignment and trade-off conversations.

It’s difficult to practice this, despite how many people claim they do. This, like many other cultural norms, is easier to implement when leaders exemplify the behavior.

One instance I remember very clearly is my VP of product at YouTube publicly acknowledging and praising a critical-feedback email from a PM. In doing so, he showed that constructive criticism was okay — even celebrated — because org leaders like him want to improve and be more effective just like individual contributors.

Maintain a healthy reservoir of doubt.

The rapid rate of change in technology and consumer behavior guarantees that we can never fully predict most things. Experience may become obsolete over time and across domains. (This is also why you must continue building renewed intuition)

It’s important to note that this does not come at odds with a deep conviction of belief. You can and should have conviction once you’ve ascertained a set of predicating facts. But before that, what you have is a hypothesis that needs to be validated.

It is dangerous to declare absolute belief when you do not have predicating facts. You’ll find yourself anchored to it by ego, and look for evidence that confirms your belief, and reject anything contradictory. Bad PM 101.

A simple habit that won’t hurt at all is to add a degree of certainty in front of a statement that you don’t have total conviction on.

“I’m 80% certain that X will happen if we do Y, because Z.”

Any time someone says they have “total conviction”, it’s worth asking why they are absolutely certain. Getting into the habit of doing this forces teams to be more disciplined about assessing their understanding of the problem, and identifying the reason for their conviction behind a strategy.

Focus on a few key things. Say no to the rest.

Spread yourself too thin, and you deliver mediocre results across multiple areas compared to what you could on any given one. On the other hand, focusing on a few things by definition means you give up on most things. So what do you do?

Manage your career how you manage products. Forget the shiny things. Find the few things that drive results, and lean into them. Delivering incredible results across 2 meaningful projects beats delivering mediocre results across 4 projects.

When you have solid rationale that logically concludes a set of prioritizations, it acts as a guiding post for you to say no (or not yet) to most things. If you do not have a solid reason for wanting to prioritize a certain way, then it’s worth questioning your assumptions, and assessing how to verify your intuition.

Learning to say no can be scary, but it’s a powerful tool to focus yourself and your team. It is far better to say no and disappoint a colleague momentarily than it is to drag days / weeks with soft commitments that then fall through.

Of course, you don’t always have the luxury of making this decision, but when you do, focus the majority of your efforts on a few key matters.

The customer is your #1 stakeholder.

Do not optimize for what you think your boss (or their boss) wants. That is the fastest way to lose touch with what really matters.

We get better at what we choose to work on. So choose to get better at solving customer problems, not guessing what your boss wants. If these things are aligned, awesome! But work on it because it matters to customers, not because it’s what your manager wants.

Culturally, most of us are taught at a young age to obey authority. As a result, we are accustomed to social hierarchies, and conformity and obedience become second nature. As such, it’s quite easy to settle into a mode of default compliance, which is terrifyingly illustrated through the Milgram experiment. Be aware of this, and rewire yourself toward curiosity and solution oriented thinking, rather than optimizing for least-controversial.

Tactical advice:

As a team leader, realize that any time an executive provides an opinion, it is not automatically a directive. Remove that unnecessary pressure, and you reduce a lot of the stress from yourself and your team.

As an org leader, you can make it easier for your team to focus on the customer by explicitly calling out that the team is the expert on the customer, and that your role is to provide guidance and support. It also helps to communicate clearly whether you’re stating a fact backed by data at scale, an anecdotal thought based on a few customer observations, or simply a personal hunch.

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Don’t pay attention to competitors, but pay attention to their customers.

Competitive moves are often distractions for product teams to over-index on. However, once in a while, competitors uncover latent demand in the marketplace in such a meaningful way that the ecosystem shifts in response.

When you drive a car, it’s dangerous to only pay attention to what’s in your lane. When you build a consumer business, the same applies.

This does not mean you copy what your competitors do. This merely means you observe and thoughtfully understand why certain competitive moves are successful. This is crucial for managing existential risks in a competitive landscape.

YouTube Shorts is an initiative born out of understanding, identifying, and executing against a change in consumer needs for video content. It’s also an initiative based on observation of Tik Tok’s success.

Without paying attention to Tik Tok’s customers, YouTube might have gone a few more years without shifting attention to short video creation and consumption. By then, it would have been too late.

Talk to customers about their problems, ignore (most of) their ideas for solutions.

This one is controversial but the truth is users/customers often don’t know what they want. Why? 

In the consumer product world, customers aren’t likely to spend as much time thinking about the product as builders do. The problems that get resolved over weeks of daily teamwork are merely passing thoughts in a 3 minute internal dialogue for most users. So it would be unwise to expect customers to have the same depth of thinking as product teams.

On the other hand, customers know their own needs better than anyone else. It’s from understanding these needs that product thinkers can arrive at “the next big thing”.

Gifting at Twitch turned out to be a massive win because the team working on Subscriptions talked with their customers consistently, and understood their needs better than anyone. They learned what motivates Subscription buyers, what they enjoyed, and what gaps there are in the existing product.

Through numerous conversations and research efforts, the team recognized the untapped potential of enabling high value customers to get more of what they want, while sharing value back to the rest of the community. This unlocked tremendous value for Twitch creators, users, and the platform.

Intuition / data / research is necessary but sometimes insufficient.

These are all tools within your tool belt, and your “best” tool depends on context

When intuition is not enough:

Intuition is the ability to know something without rigorous analysis. It lets us bridge the gap between the conscious and nonconscious mind, and implicitly connect instinct with reason. In product, it is often the way we set an initial direction for new initiatives.

There’s a certain magic to “just knowing”. But there are clear limitations to relying on intuition alone. In every — yes, every — situation, you have to look at data to assess whether intuition is guiding you in a good direction, and you must continue to do research to calibrate your instincts.

When data is not enough:

Data can give you the clearest indicator of success on most initiatives, but the more that you’re working in an emotional and gut feel element (“why” questions), the less useful (and less available) data is.

In these instances, you want to rely on judgment, which is built up over tens of thousands of small experiences and interactions over time. A different interpretation of data leads to variance in downstream decision making, which could work for you or against you. This is not a suggestion to ignore data, but to highlight that solely looking at data won’t give a complete picture.

This is doubly true for Products on the transformative edge of how people connect with one another, and how communities form and strengthen (e.g. creator economy). Human connection is deeply personal and intuitive. Quantitative data cannot explain the full spectrum of nuances in the human emotion algorithm.

When user research is not enough:

When it comes to revenue generated directly from users, no amount of research in a controlled, artificial environment will teach you about the human desirability to spend with your product.

In a made up, hypothetical scenario, it’s impossible to emulate the emotional pain of having to give away $10. Any research results indicating people’s willingness to spend must be heavily caveated.

In these types of cases, you must learn in real world scenarios, at scale, and in context.

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Invest in yourself.

Take time to do the things that improve your wellbeing, balance, and perspective. By making yourself better as a person and leader, you are helping your team, your company, and your customers.

“I have so much to accomplish today that I must meditate for two hours instead of one.” - Mahatma Gandhi

It’s okay (maybe inevitable) to be consumed by work occasionally. Sometimes, you’ll make breakthroughs and achieve a ton in short, intense sprints.

The problem is when this is the perpetual state of your life. When you’re intensely focused on work for 12 hours a day, 7 days a week, your body physically breaks down, and you stop being creative and clear minded. This would be a complete disservice to the people who depend on your best work.

In creative work such as product, engineering, design, and marketing, singular focus on the tactical work may make you efficient, but it doesn’t make you effective. Taking yourself out of the weeds and letting your mind relax often helps to connect the dots between your work and other relevant observations.

Giving yourself the space to take time away from staring at the screen can produce outsized returns in a domain where creativity drives a high variance in results.

“While procrastination is a vice for productivity, I've learned--against my natural inclinations--that it's a virtue for creativity.” - Adam Grant

Play the long game.

This one is extremely applicable to life outside of work, so I’ll cover it more generally.

Signs you’re playing the short game:

• Put off anything that seems hard or doesn’t have immediate payoff.

• Put things in a zero-sum context when it’s really positive-sum.

• Perceive decisions as transactional rather than relational.

• Take more than you give. Spend more than you earn.

• Consume far more than you create.

Why do people play the short game? The seduction of playing a short game is often visible / immediate results. The temptation can be really hard to overcome, because you will see most people around you playing the short game. More often than not, they aren’t bad people, they’re simply optimizing for the systems and incentive structures they can observe in a short time horizon. By being close to them, you’re more likely to do the same.

But you should not. The longer you play the short game, the more difficult things will get. The accumulation of good habits and bad habits have a compound interest effect, taking your life in opposite directions.

So what is the long game?

The long game is choosing to enjoy less today, so that you can have more favorable outcomes in a much longer time horizon. It’s the mundane, tedious, and exhausting work. It’s building trust, showing up, and subjecting yourself to adversity. It’s the willingness to suffer in the near term so that you will succeed in the future.

Humans are innately terrible at delaying gratification, and even when you see someone playing the long game, often it’s not obvious it’s beneficial in the moment. From the outside, the long game can look boring or even stupid:

• Skip the all night rager to get some sleep (naysayer: “antisocial, boomer”)

• Share insights / work early with people who might oppose it (naysayer: “doesn’t get it“)

• Push for innovative and risky initiatives that are likely to fail, but if successful, will change everything (naysayer: “try-hard, should stick to their lane”)

• Work on worthwhile things that have no immediate payout (naysayer: “slow to promotion, career stagnation“)

• Eat healthy when everyone you’re with is eating junk (naysayer: “lame”)

• Go for a workout instead of watching Netflix (naysayer: “out of the loop, boring“)

• Create, even when you have no motivation to, and no audience cheering you on (naysayer: “self-important when no one cares, waste of time”)

Naysayers are a dime a dozen. It’s infinitely easier to criticize than to do something. Most people do the easy thing, and they reap adequate rewards.

Few people play the long game. In doing so, they choose the difficult path. On that path, they suffer ridicule, setbacks, and more frequent failures. But they build skills, confidence, and relationships that no shortcuts can offer. In the endgame, they grow more than others can fathom, and can do what 99.99% of others cannot.

Two roads diverged in a wood, and I—

I took the one less traveled by,

And that has made all the difference.

— Robert Frost

To sum it up

1. Balance optimizing for efficiency and flexibility.

2. Welcome feedback and seek dissent.

3. Maintain a healthy reservoir of doubt.

4. Focus on a few key things. Say no to the rest.

5. The customer is your #1 stakeholder.

6. Don’t pay attention to competitors. But do pay attention to their customers.

7. Talk to customers about their problems, ignore (most of) their ideas for solutions.

8. Intuition / data / research is necessary but sometimes insufficient.

9. Invest in yourself.

10. Play the long game.

Let me know what principles you’ve found important in your growth (including ones not mentioned here)!

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📰General News

Instagram rolled out ads on Reels worldwide. It had tested ads in select countries previously. Ads will appear in between individual Reels. (TheVerge)

TikTok ad business (and prices) and on the way up (Bloomberg)

Facebook’s Clubhouse competitor, Live Audio Rooms, launched late June. It borrows heavily from Clubhouse. (TechCrunch)

Podcasts are now on Facebook. (TheVerge)

Facebook announced Bulletin, its Substack newsletter competitor (TheVerge)

Facebook announced Fan Groups, for games to organize topics into threaded discussions and help people find others to play games with. (SocialMediaToday)

In an internal memo, Bytedance told its employees its 2020 revenue more than doubled from the previous year, from $16.3B in 2019 to $34.3B in 2020. Gross profit nearly doubled, too. (TheInformation)

TikTok will be the title sponsor for VidCon, taking place this year in October. VidCon has historically had YouTube as its title sponsor. (Variety)

Twitter to add a “subscribe” button for Revue (recently acquired) newsletters on profiles. (Mashable)

Spotify launched Clubhouse competitor Greenroom as its bid into the live audio space. (TechCrunch)

Gift.me, a RealGifts company, launched in June. Gift.me offers influencers and creators a way to wishlist luxury products from Gucci and Chanel for fans to buy for them. (PRNewswire)

Influence.co released a list of 438 creator economy companies across 20 categories such as memberships and merchandise. The list has grown more than 50% compared to its map in 2020 (Influence.co)

‘Doge’ meme NFT now holds the single NFT sale price record at $4M (NBCNews)

YouTube is poised to overtake Spotify as music’s biggest bankroller (RollingStone)

Facebook’s announced that the company would refrain from taking a cut of online events, fan subscriptions, badges and its Substack competitor for journalists until 2023. This is classic Facebook, as mentioned in the previous post. (Facebook)

Instagram is testing an affiliate marketing program that lets creators make money from purchase referrals and virtual storefronts. (TechCrunch)

Twitter is opening applications for its Super Follows feature, which allows account holders to charge followers for exclusive content. Requirements include being 18+, having10,000+ followers and tweeting 25+ times in a month. Twitter will take just 3% of subscription revenue until creators hit $50,000 in earnings. After that, its share will be the previously announced 20%. (Twitter) (TechCrunch)

Cameo says more than 80% of the celebrity shoutout platform’s revenue comes from web vs. its app. Cameo is among a host of apps complaining about the 30% platform fees from Apple and Google for digital in app purchases. (CNBC)

Facebook will test “visual search” soon, allowing users to use a photo to find similar products to purchase on Instagram, (similar to what Pinterest did 6 years ago). Mark Zuckerberg also announced virtual shops are coming to WhatsApp and Facebook Marketplace. (Engadget) 

Alessandro Paluzzi tweeted a screenshot showing that Instagram is exploring NFTs. An Instagram spokesperson said this is an internal prototype that is not being tested externally. (Twitter)

Snap has entered an agreement with UMG to secure certain licenses. Music is an important dimension of short-form videos, TikTok and YouTube Shorts have landed on similar deals with major labels. (TechCrunch) 

ByteDance rolls out Douyin to on web to drive new user growth. (TheInformation)

Kuaishou reached 1B global MAUs. The Tencent-backed Tik Tok competitor had a massive IPO in Hong Kong earlier in 2021. (PRNewswire)

Famous Birthdays, a wiki site offering bios and basic information about popular Gen Z creators and celebrities, is testing a paid version for social platforms, agencies, and brands by helping them identify rising Gen Z creators. (Tubefilter)

Twitch users watched 2.2B hours in May, up 37% compared to last year, according to StreamLabs and Rainmaker.gg. (GamesIndustry.biz)

Patreon CEO Jack Conte says that Patreon does not have a special deal to avoid 30% in-app purchase fees. “Why don’t we have to pay fees? I think it’s because, for whatever reason, we’re within Apple’s guidelines…” (TheVerge)

Spotify acquired Podz, a podcast-discovery platform. Podz will "complement and accelerate Spotify's focused efforts to drive discovery… deliver listeners the right content at the right time". (TechCrunch)

Beeple launched WeNew, an NFT platform that sells “iconic moments”. The platform’s first auction will kick off with Andy Murray’s Grand Slam match-winning point as an NFT. The winner will get an opportunity to play tennis with Andy on a court at Wimbledon along with several other perks. (VentureBeat)

💰$$$ 

LinkedIn invested in virtual-events startup Hopin, valued at $5.65B. (CNBC)

Seven Seven Six closed its $150M first fund. Seven Seven Six has invested in creator economy startups including short-form video app Clash and PearPop, where influencers can buy/sell collaborations with other influencers. (Forbes)

Dispo says Annie Leibovitz, Cara Delevingne, Sofia Vergara, Kevin Durant’s Thirty Five Ventures, and Andre Iguodala’s F9 Strategies invested in its Series A. Alexis Ohanian’s Seven Seven Six, which led Dispo’s Seed round, participated as well. (TechCrunch) 

IRL announced a $170M Series C, led by SoftBank at a $1.17B valuation. (TechCrunch) 

Spotify signed a three-year contract for >$60M for exclusive rights to the "Call Her Daddy" podcast by Alex Cooper. (Variety)

OnlyFans is fundraising at a valuation north of $1 billion, as it plans an expansion from adult content to become more mainstream. This would be the first outside funding the company takes. (Business Insider)

Harry Stebbings’ 20VC raised two funds totaling $140M from investors including the MIT endowment, RIT Capital Partners and early backers of Spotify. (Fortune)

Nate, a shopping app, raised $38M in Series A led by Renegade Partners. The startup is launching new social features to give creators cash back for purchases referred from their lists of recommended products (affiliate model). (BusinessWire)

WaitWhat, a media company founded by former TED executives, raised a $12M Series B led by Raga Partners. (TechCrunch)

Live-video platform Happs raised a $4.7M round led by BullpenCapital. (TechCrunch)

Spore, a startup offering a platform for creators to build white label communities, with chat rooms, CRM, and a bevy of other services, raised $1M in Pre-Seed led by SignalFire. (TechCrunch)

Convosight, a software provider that helps people monetize Facebook groups, raised $9M in Series A, led by Singapore firm Qualgro. (PRNewswire)

Hunter Walk and Satya Patel, Co-Founders of HomeBrew, are launching Screendoor, a $50M fund to support underrepresented venture capital investors. (Screendoor)

Engine Media, a Toronto-based media company focused on esports and gaming, is acquiring Atlanta-based influencer marketing agency Sideqik. (PRNewswire)

Vungle, a mobile advertising firm, is acquiring JetFuel, an influencer marketing agency. (VentureBeat)

💭Recommended Reading

TikTok changed the shape of some people’s faces without asking (i.e. user did not apply filters) (MITTechnologyReview)

YouTube Shorts is taking on TikTok and minting a new constellation of concise video stars (Bloomberg)

Young creators are burning out and breaking down (NewYorkTimes)

You may not want to get beauty tips from TikTok (NewYorkTimes)

Is Clubhouse the Next Foursquare? (TheInformation)

Platforms roll out tipping features, vying for user engagement and ad dollars (Digiday)

The shady, secret history of OnlyFans’ billionaire owner (Forbes)

Big Tech moves in on the creator wars (Axios)

The creator economy comes of age as a market force (Entrepreneur) 

Why social media platforms are getting in front of the growing creator economy (Digiday)

Why Instagram is starting its first training week for creators (Digiday)

Apple is encroaching on Facebook’s territory like never before with new social features (CNBC)

Will Apple Mail threaten the newsletter boom? (Platformer)

Even Amazon wants in on the Creator Economy. (eMarketer)

The creator economy is running into the Apple Tax. Apps such as Fanhouse are fighting back (TheVerge)

A new wave of dating apps take cues from TikTok and Gen Z (Wired)

How influencers fit into Twitter’s plans to double revenue by 2023 (CNBC)

Hello, Content Creators. Silicon Valley’s Investors Want to Meet You (New York Times)

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In recent news(letter), Facebook launched Bulletin

Substack has taken the newsletter world by storm, recently raising $65M led by a16z.

With Substack, Medium, Ghost, Revue, and a growing list of platforms, newsletter creators now have a healthy collection of tools to help with creating, publishing, distributing, and monetizing newsletters.

Predictably, as the space heats up, Facebook has entered the fray in the form of bulletin.com. Luckily for Substack, Facebook’s public perception and copycat reputation aren’t exactly winning a warm welcome for Bulletin.

Setting aside the negative reactions and classic Facebook strategy of “Free at launch (in exchange for data and product lock-in)”, can Substack innovate and execute before Facebook commoditizes it?

In this post I’ll unpack why Substack’s survival could hinge on:

• Discovery

• Monetization

• Community

What can Facebook offer? How should Substack respond?

1. Discover - Help people find the content they care about

2. Subscribe - Enable consumers to “directly support” creators by subscribing with Facebook Pay

3. Unlock - Let consumers buy premium subscriptions via Facebook Pay

4. Connect - Social interactivity with subscription groups using live audio

Discover

This is a key battlefront, and Facebook has the advantage. Facebook is one of a handful of companies with enough data and scale to train its recommendation system to achieve a world-class search and discovery experience. Every moment of every day, Facebook takes a vast ocean of text, photo, and video content and delivers personalized feeds for people around the globe. It efficiently ranks content at an individual level, and it’s done so for 15+ years. As for the impact of this discovery system, Facebook’s growth speaks for itself.

On Substack there are no sophisticated algorithmic discovery systems. As for search? Below are the search results “Creator Economy” on Substack.

It’s a static set, and there’s no “show all results” or pagination to see more. The red number below indicates how many posts they have published in the past 2 months.

60% of results shown have posted 0-1 articles in the past 75 days.

Some of these newsletters have 0 lifetime posts, meaning users will click into the newsletter, potentially subscribe to it, only to see that it is an abandoned newsletter. Bad UX 101. Meanwhile, guess who writes weekly and doesn’t show up? 😅🧂🧂

Perhaps Substack only cares about writers who have an existing audience. Or perhaps Substack wants to figure out how to help small writers grow an audience if it wants to serve a broader set of creators. Either way, Substack needs to decisively clarify its strategic position: Is Substack a BYOA platform that serves writers who already have meaningful following, or is it a one-stop shop for all independent writers, not only those at the top?

If Substack is simply a BYOA platform for top writers, then it must make this clear to aspiring writers, and it should consider shuttering half-baked efforts into discovery to focus on key monetization differentiators.

But if Substack means to be a platform that serves creation, publishing, discovery, engagement, and monetization needs, then it cannot win at scale if the only writers who can succeed on it are the few with an existing audience — discovery is a must.

Subscribe / Unlock (Monetization)

These are Bulletin’s creator monetization pitch. Monetization is what led to Substack’s recent trajectory. In Casey Newton’s words:

If writers can convert 3,000 subscribers, that’s an incredible job. That’s an amount of money that almost no one in media would pay.

Money talks, bullshit walks. The prospect of making a significant income from writing uprooted star journalists from major publications. For many star journalists, Twitter has enabled them to build a personal brand that transcends that of their employers. When they achieve this level of fame in the current news publishing world that doesn’t reward them enough, they are bound to move on to greener pastures.

In terms of the actual product, Bulletin doesn’t seem to be offering anything unique or advantageous in monetization features:

• Pay gating content is fairly commoditized

• Bulletin might only supports payments through Facebook Pay according to the language on the site

Features aside, this sentence on Bulletin.com should be turning heads:

Facebook will not take a cut of the revenue from Bulletin creators at launch.

“At launch” implies there’s a future where Facebook will take a cut of the revenue, but in the near term, Facebook has decided to take a negative margin on Bulletin to attract writers. In comparison, Substack takes 10% of subscription revenue, and Twitter’s Revue takes 5%.

When it comes to stifling competitive threats, predatory pricing is often the name of the game. This is commonplace when big companies notice that small companies have uncovered latent demand in the marketplace.

• Amazon Moms crushed Diapers.com with unsustainable discounts

• Apple offers steeply discounted introductory prices for Apple Music, edging out Spotify because Apple can afford to lose money on its music streaming business in perpetuity. It wins by weaving its software and hardware evermore into consumer lives, securing the next wave of iPhone / iPad / Apple Watch sales

As a rising new platform, Substack is not in a strategic position to reactively reduce its revenue share to match Bulletin’s. Even if Substack does engage in a race to the bottom, the strategy may not yield meaningful competitive gains. The answer to Facebook and Twitter’s margin games is to ignore it, and instead improve the value of its offering so much that keeping 90% of revenue on Substack feels like an amazing deal compared to keeping 100% of revenue on other platforms.

Price is what you pay, value is what you get. - Warren Buffett

To toss out two terrible ideas:

1. Writers have shown a willingness to bundle their work, and there have been examples of success (Every.to). How could Substack enable this behavior at scale? How could Substack automate the work of similar collaborations?

2. High value fans from other content genres have shown a propensity to expand creator support spending when they’re able to help others. The top 2 gift subs buyers on Twitch have spent a combined ~$54M (if the data is good). How can Substack unlock this level of generosity from its writers’ biggest supporters?

Connect (Community Engagement)

Connecting consumers and creators via social interaction is Facebook’s bread and butter, which it can explore by leveraging parts of its massive existing network and tapping into a host of engagement features across Facebook Inc apps.

When the most popular Substack newsletters get an average of ~5 comments on each article, it is clear that reader engagement is not a winning area for Substack. Yet it may also not be the hill Substack should choose to die on, given Substack’s mission is to enabling writers to “generate income directly from their own audiences and on their own terms”.

However, Substack can consider community efforts in service of its monetization focused mission. For writers to effectively monetize fans, they need to offer what fans want. Increasingly, pay gated content on its own is not enough.

The most successful newsletters now come with rewards and perks not supported by Substack natively. For example, Lenny’s newsletter offers a Slack server for paying subscribers, and that’s where the community talks, asks and answers each other’s questions, and even co-creates content for a Community Wisdom series. How might Substack improve its own community features in a way that drives more revenue?

Additionally, Substack can focus on connecting writers with each other and increase their mastery and investment in Substack. Its resources page, office hours, and shout out threads are healthy steps in this direction. It could also take a cue from programs such as YouTube’s Creator in Residence, to help develop up and coming creators on its own platform. Simultaneously, these types of programs allow product teams to interact with creators directly to listen, get feedback, and ideate.

Again, this comes down to Substack’s company and product strategy. Will it be the all-in-one place that writers can grow, connect, and engage with the community and each other? Or will it be the place for established writers to monetize an existing audience? There’s no right or wrong answer, Substack must make its focus clear for users and for itself.

Substack’s Facebook Answer

To recap, here’s what Facebook offers and how I believe Substack should respond.

• Discovery is Facebook’s strong suit, and quite lacking on Substack. If Substack decides it is the BYOA platform for established writers, it should forego this area. But if Substack decides to be a place that small writers can grow, then it needs to get search & discovery to a useful state. Otherwise, it risks losing the next generation of newsletter writers.

• Monetization features are fairly standard today, but Facebook (and Twitter) are offering more favorable revenue sharing terms. Substack can ignore the race-to-bottom margin game, and build on the value of its monetization offering so that writers prefer a 90% share on Substack over a 100% share elsewhere.

• Community can help form habits and drive subscriptions. Facebook has existing engagement features to draw on, but Substack has shown it can super-serve the writer community better than incumbents. Writers have shown various hacks to add value to paid subscriptions, and Substack is in the prime position to mold their native offerings to capitalize on these behaviors.

Substack had an amazing start, it was bound to attract competition. Now it must clarify to itself and to writers what it wants to be, and focus on executing that vision.

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Short post this week with an example illustrating the concept from last week.

Streaming video: Unbundling gone too far

Over the past decade, consumers experienced drastic shifts in how they spend time consuming content. This has been due to a combination of

1. Explosive content creation

2. Improved connected hardware and software for viewing

3. The nature of “everything on-demand”

People are watching more video than ever, spending > 1 hour daily on online videos across numerous services. There is a shift from TV to digital, but there’s also a net increase in video consumption. Today, people under 35 spend more time watching online videos than consumers a decade ago spent on TV.

To meet this consumer demand, subscription based aggregators (e.g. Netflix, Hulu, Disney+) have sprung up in place of traditional cable networks, each syndicating, licensing, or producing original content

Consumers can pay $8-$16 a month for each of these services. An average American watches 3.4 services for ~$30/mo, and trending up. While lower than cable + internet costs of $110/mo, subscriptions ($30/mo) + broadband ($70/mo) quickly add up to monthly costs close to that of yesteryear’s cable bundles.

As service prices go up, and content becomes siloed in walled gardens, selection and savings diminish

There’s more financial motivation for consumers to share accounts. Today, an estimated 34% of streaming service users are borrowing an account. For Gen-Z, “borrowers” are a whopping 72% of users. Unsatisfied consumers have begun purging subscriptions. Two in three surveyed consumers report that they will unsubscribe upon further price increases.

Prediction: In the next 3 years more startups will emerge to re-bundle in a way that delivers more value to consumers. Some already exist: ReelGood, KeyRing.

These companies are still playing above board, monetizing in ways (e.g. ReelGood selling aggregated user data) that incumbent streaming platforms can accept. But are we close to seeing the next “f**k you” to content rights holders à la Napster?

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While technology and product innovation is pouring into the creator economy, companies are also shuffling, assembling, and packaging existing building blocks into “new” value propositions.

“There are two ways you can make money. You can bundle or you can unbundle.”

- Jim Barksdale

In this post, let’s dive into bundling and unbundling in the creator economy from the perspective of:

1. Creators

2. Consumers

3. Companies

1. Creators: Team up, spread out

As a reminder: creators want money, fame, and love.

In the positive sum game that is the creator economy, working together is key, so it’s no surprise that successful creators lean into collaboration. Creators are opting into explicit opportunities to work together via creator / content houses. By living together, they enable a network of creativity that unlocks more co-creating, mutual teaching, cross-promotion, and growth. In other words, they’re supercharging inputs to success.

Successful content houses have also become valuable intellectual properties. Sway House’s deal with Magic Spoon shows how a creator collective can define a new category of brand deals between a group of creators and a brand. This trend is gaining momentum in team-level merchandising and reality TV.

In addition to teaming up on creation, creators are also packaging and selling their individual work together to increase collective appeal for audiences. Every.to exemplifies how creators bundle their work, and offer curated, high-quality, adjacent value with better consumer economics.

By doing so, they increase the value of a subscription, and rise above a threshold of perceived ROI to convert more sales. Perhaps more importantly, they also reduce the content production burden on each individual creator in the collective:

• In a 10 creator collective, if 1 creator misses their weekly publishing cadence in a given week, there’s a small value loss for customers. If a solo creator misses their weekly publishing goal, there’s 100% value loss for customers.

Creators are also spreading out their businesses into disparate places to avoid concentrated platform risk. Creators are keenly aware that when they build their brand on a platform, they play by the platform’s rules, which could change suddenly and without warning.

This could manifest as a harmless UI refresh or new feature, but it can be also come as an unannounced algorithm change that tanks your content, or an opaque act of policy enforcement that wipes out years of hard work.

For this reason, as creators achieve more success, they branch out from their primary platform, and spread their bets to diversify and grow their business.

• They cut different versions of content to distribute on several platforms

• They separate out the places for growing audience vs. nurturing community

• They refuse lucrative platform contracts because of exclusivity requirements

• They put link-in-bio to direct their audiences on one platform to another

• They create separate lines of business (e.g. merchandize) beyond content

2. Consumers: Savings, selection, simplicity

Consumers seek to maximize entertainment & information within spending limits.

Savings

Two bundling formats commonly available to consumers are 1) bulk orders, 2) family plans, 3) set purchases. Both hold the premise of trading volume for unit economics — “the more you buy, the more you save”.

• Bulk order: Drop and PinDuoDuo. In common household goods, unit economics are more favorable for consumers if they buy more (8 pack vs. 2 pack)

• Family plan: AT&T family lines, Netflix subscriptions with four seats

• Set purchase: Purchasing a set makes sense for complementary goods. Merchants further entice this with special offers. This also appears as BOGO deals

Saving 💰 is self explanatory, but it’s worth calling out that when it comes to perceived value, personal preference is an important factor. Improvements in simplicity and selection may be worth $20 to some people and $0 to others.

Selection

By offering a diverse selection of goods and services, platforms can offer something that appeals to any consumer. YouTube would not be the same if there were only 10 creators talking about personal finance. The broad consumer appeal of YouTube is thanks to the wide spectrum of creators covering a range of topics.

However, there is a point of diminishing returns beyond which more selection degrades user experience.

When new users start following 100 interesting accounts on Twitter, this positively impacts their product experience. But when they’re following 9900 accounts, they’re already unable to engage meaningfully with that social graph; following 100 more accounts in this scenario degrades their product experience by adding noise.

In Paradox of Choice, Barry Schwartz argues that eliminating consumer choices can greatly reduce anxiety for consumers. At YouTube, Facebook, and Twitch, there are various instances where reducing optionality for certain creators and consumers results in greater engagement.

Simplicity

As consumers, we are always looking for the best deal in every facet of life. Content is no exception. We prefer convenience and ease, which impact on our decision making.

This has been the case since the dawn of modern age. When movie theaters were introduced as the only distribution platform for motion picture entertainment, people went to the theater with wonder and excitement. However, after televisions brought on-demand motion picture into the comfort of people’s homes, towns with movie theaters reported an 80% decrease in movie theater revenue.

Today, the simplicity of on-demand entertainment at our fingertips has led to a dramatic shift in our consumption habits. Bundling eliminates our need to go to different places, learn different UIs, and remember multiple passwords. If done right, bundling streamlines how consumers solve for various adjacent needs, and creates ease and convenience that undeniably improve consumer experience.

On the flip side — jamming too many functions into one place results in complexity. Complexity overwhelms consumers with mental and cognitive load, which can cause people to divest from platforms in frustration and eventual apathy. Bundling too many contexts into a product creates overload, and risks context collapse.

When an application only does 1-2 things very well, it presents a different type of simplicity — a streamlined experience for one single single use case. This is why polished single-purpose apps that unbundled multi-purpose sites have thrived in recent decades (more on that in the Companies section).

The pendulum is always swinging back and forth between unbundling and bundling. When it swings too far in one direction, the market will respond to correct the trend.

3. Companies: Blurring lines and mental models

An ecosystem formed around creator needs. Popular consumer software in the western world emerged by delivering simple, elegant solutions focused on one or two customer needs. Content distribution platforms gave them a path to earn fame; community platforms gave them a way to earn love; and monetization platforms gave them a chance to earn money.

This approach gave consumers a clear mental model and strong conceptual understanding of what each app or site is for.

• Go to YouTube to watch user generated videos

• Go to Google to search and research

• Go to Instagram to see beautiful, polished photos

• Go to Facebook to stay in touch with friends and family

• Go to Discord to chat with friends and communities

• Go to Twitch to watch gaming live streams

• Go to Amazon to shop for everyday goods

However, distribution platforms now feel the heat of competition, and are fighting for relevance. A few platforms have answered with: “do more stuff”.

• Twitter is making moves on helping creators make money. (distribution —> $)

• Snap is throwing a million dollars a day at creators to acquire content while they attempt to figure out a long term creator revenue model. (distribution —> $)

• YouTube is doubling down on content engagement and monetization efforts. (distribution —> community + $)

• TikTok is building a platform owned marketplace between creators and brands. (distribution —> $)

• Facebook is doing whatever competitors do. 😜 (distribution —> everything)

Various product updates from these companies seek to expand the core value they provide to consumers. And the eastern world shines a spotlight on how this would look at the extremes.

• Go to WeChat for everything

In many ways, bundling is a key strategy for incumbents. These platforms aim to provide increasingly broad utility for users, and “all-in-one” is the signature move to simplify workflows and centralize different solutions to meet various user needs.

On the flip side, unbundling is the only viable playbook for upstarts. Startups are underdogs by any account, and their only chance for success is to prioritize the 1-2 things that matter, and be uniquely great in those dimensions. If a product is great, it doesn’t need to be good. For example, Twitch had no chance to beat YouTube in the video-on-demand world, so they found a special wedge into the video ecosystem by focusing on a niche that YouTube paid no attention to: gaming live streams.

Another approach companies take is bundling value while unbundling existing systems. The happens when there is a fundamental change in how people and companies can perform key workflows because of technological advancements.

Amazon bundled solutions for end-to-end merchant needs (storefront, payments, fulfillment, shipping, and customer support), and in doing so, they unbundled constraining legacy systems (brick and mortar shops for retail distribution, costly shipping deals that must be negotiated with UPS, costly in-house customer support teams), which unlocked value and saved operating expenses for sellers.

Closing Thoughts

Like the seasons, bundling and unbundling will endure as a cyclical phenomenon for the rest of our lives.

Creators, consumers, and companies would do well to recognize or create bundling and unbundling opportunities that deliver value to the rest of the ecosystem and produce a better financial outcome for themselves.

There’s already ample value creation in the creator space today, but with the right bundling and unbundling, fragmented value will be organized to further accelerate the growth of the overall creator ecosystem.

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We are witnessing constant advancements throughout the creator ecosystem. For startups and incumbents alike, there is opportunity to capitalize on the changes happening around us.

Below are four predictions for key areas companies will invest in.

1. Platform owned marketplaces

The primary value add of content platforms is connecting creators with an audience, connecting viewers with interesting content, and connecting advertisers with targeted attention. Looking ahead, platforms with a creator-first mindset will think about new ways to enable stakeholder success, starting with creators.

Platforms have the requisite scale, data, and attention from stakeholders to enable a marketplace for various creator needs ranging from creation, editing, hiring a team, and monetization. For example:

• Brand <> Creator partnership marketplace (monetization)

• Music / audio / meme / B-roll marketplace (creation / editing)

• Editor / Analyst / Mod marketplace (hiring a team)

Let’s take the content marketplace idea, which boils down to the idea of helping creators to produce better content with lower effort. Why is this viable?

Well, Tik Tok has reminded us with its creation tools (duets, stitching, editing suite) that remixing is fundamental to content creation. Tik Tok’s network effects of creativity has shown that assembling existing media components can result in outsized returns of attention, rather than having to create entirely original content from scratch.

Following that train of thought, there is an opportunity to connect creatives with the right existing media-building-blocks to spark content creation. To unlock this opportunity, there is a sea of complexity that platforms must wade through for discovery systems, content rights, and incentive structure. However, the payoff will be huge if a platform can establish itself as the remix layer. So far, Tik Tok is winning that game.

Another platform owned marketplace is a match making system that connects creators with those that help them in various aspects of their business.

Whether it’s editors, managers, mods, or even brand partners, creators want to be connected with them, but don’t always have the time to be recruiting and hiring (they’re busy making content!). If a platform can offer an effective talent marketplace or sponsorship marketplace that works at scale, it will have an advantage when creators select a platform for content distribution. Tik Tok has made its bid here, but other platforms are not far behind.

2. Enable more collaboration & bundling

As previously discussed, more creators are finding success collaborating with others, and this will become more prevalent as creators gather (e.g. live together) to co-create more often. By combining their brands and audiences, their distribution power is multiplied through cross-promotion, and their creation power is multiplied through pooling resources, and working on bundled content offerings. Every.to is a canonical example of how this could work for newsletter writers and podcasters.

Consumers are responding positively to creator bundling, which consequently provides collaborating creators with higher and more predictable income.

As an example of building for creator collaboration: Stir aims to become the de facto place for creators to run their business. Their apparent strategy is to be the unified control center for the backend of collaboration, operations for creator SMBs, and cross-platform analytics. By doing so, they unlock optionality for extending into other aspects of running a creator SMB (e.g. workflows for brand deals or revenue sharing).

As collaboration and bundling become more prevalent, the friction and pain points with these workflows will become more obvious, and that’s where platforms can provide significant value. As Maxime Eyraud puts it:

Digital platforms should pay attention [to collaboration and bundling] if they hope to please – and retain – their top creators… services that fail to address this use case may see valuable talent move elsewhere as they outgrow their first digital home… bundling is likely to create tedious admin work for all involved, shifting time and focus away from actual creation. From proper attribution to right windowing to revenue split, creators will need dedicated tools to help them manage various aspects of these partnerships.

Example ideas:

• Creator team subscriptions (e.g. sub to a group of 4 creators for the cost of 3)

• Insights on who creators should collaborate with (e.g. based on audience overlap)

• Automation of brand deal workflows, using standardized templates to remove unnecessary complexity from sponsorship deals

3. Creator-centric advertising

With Clubhouse launching 0% fee tipping, Facebook and Twitter both getting in the paid newsletter game, and start ups such as Ko-fi wedging their way into the ecosystem with low cost payment offerings, it’s clear that helping creators make money will be a heavily contested arena.

Yet, the advertising infrastructure that enables brands to reach potential customers has barely adjusted to explosion of the creator economy. Brands and platforms have taken note of changes in consumer behavior and trust, but the systems that request, sell, and serve ads against content have not responded much. But they will.

Ad creative featuring creator content or creators

Creator content will be partially re-purposed as ad content via the next generation of ad tech. Content from successful creators are many times more engaging than standard ads made by a creative agency. Brands know this. Platforms know this. Creators and consumers know this.

This golden opportunity is ready for the taking, brands just need to capitalize on a growing corpus of viral clips, memorable moments, and culture defining memes to associate with their own identity. Few brands have started down this path, but as creators make more awesome content, the opportunity will become too obvious to ignore. This next phase of online advertising is not a matter of if, but when.

A more apparent opportunity is to feature creators directly in ads. Creators are already starting to be featured on commercials, and it’s not a stretch to imagine brands signing on creators as brand spokespeople. It will be a throwback reinvention of celebrity spokespeople with creators at the center.

Example ideas:

• Allow brands to boost organic user generated content (UGC) featuring the brand

• Let advertisers commission paid ad content creation, rewarded by performance

• Enable UGC to be remixed into ads, letting brands pay creators and rights holders for content they want to use in ad creative

Creator based targeting

Interest based targeting has been largely successful over the past decade for driving online sales, but as privacy laws change and platforms change their tone on user tracking, advertisers will need to produce results without quite as much visibility.

Meanwhile, content platforms have first party insights into the relationship between creators and fans. With that data, they can not only help facilitate creator <> brand relationships, but also fuel creator based targeting.

For instance, this would let Adidas make custom ads with creators A, B, C, and use creator based targeting (provided by platforms) to show the relevant ad for different fanbases on the platform and elsewhere on the internet.

Creator centric ad exchanges

Exchanges are another angle of attack.

The current online model of real time bidding systems don’t necessarily lean into the high engagement model of the creator ecosystem. For this reason (and a host of brand safety concerns), formats such as live streams notoriously underperform on ad revenue per hour watched compared to their VOD cousins. Yet we know that live content generates a wealth of revenue through non-ads sources. So how will ads catch up?

inSTREAMLY is one example of an independent (not platform-owned) player that wants to shake up the live ad ecosystem with a new model of live stream sponsorships. If inSTREAMLY succeeds, its model would set a precedent of a hybrid approach, combining 1) the online model that utilizes big data and ML to enable economies of scale across millions of creators and live streams, with 2) the offline model of human orchestrated, custom creative and placement on the video, which gets composited directly into the video feed upon ingestion.

If this hybrid model catches on, it can supplant the existing model for live ad fulfillment, and potentially produce two other results:

1. Displace existing ad exchanges as middleman between brands and live creators

2. Render ad blockers useless (because the sponsorship is stitched into the stream)

4. Evergreen / increasing creator incentive funds

Platforms are willing to set aside funds to compete for the next generation of creators.

Snap: $1M a day

Tik Tok: $1B

YouTube: $100M for the first year

Now that the cat is out of the bag, it will be difficult for platforms to ever remove their creator funds. Why?

Creators want money, fame, and love. Now that creator funds are commonplace, it allows new creators to have a shot at earning money from content sooner. This is the new baseline. It is now part of what creators expect when they choose a place to build their brand and reach an audience.

Imagine this hypothetical scenario:

It’s 2022, the creator economy is in full swing, and platforms are competing over top creator talent to secure the best content for consumers. Every platform continues to work on their long term revenue models to better capture value from hot new content formats such as Short mobile videos or live audio. TikTok, YouTube, Snap all have creator funds that appeal to aspiring creators. Instagram announces that it is shutting down its creator fund.

• What would this signal to the market about IG’s investment in creators?

• How would creators justify putting their limited time and resources toward IG?

Rather than shutting their creator incentive funds down, it’s more likely that platforms will increase the fund to reward more creators in a more meaningful way, and attract additional creators in the process.

An argument against this:

These fund programs are all temporary stop gaps from the platforms’ perspective. As soon as a platform figures out a scalable, fair, and safe way to automate the process of rewarding creators of all sizes, they no longer need a creator fund to help creators make money.

Setting aside how many years this would take, it is a possible outcome. However, the perception of being the first to remove such a visible signal of creator support will be tricky to navigate. As a result, even when long term revenue models have been figured out, companies may elect to continue their creator fund.

In a way, a creator fund could be the beginning of what eventually blossoms into platform driven Universal Creator Income.

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Market Insight

1. InfluencerMarketingHub conducted a survey of 2,000 creators of various sizes, revealing how creators make and want to make money. (InfluencerMarketingHub)

• 77% of creators said brand sponsorship are their highest revenue source, 3X the response rate of every other revenue source combined.

• Ad revenue share was the runner up, chosen by only 5.4% of surveyed creators as their highest income source.

• Tipping, a recent platform favorite, was the top revenue source for 3% of creators.

• If surveyed creators could pick one way to measure success across TikTok, Facebook, YouTube, Twitter, Instagram, Twitch, and Blogs, 17% would look to engagement rate (unsurprising, as this is what brands look for). 10% of creators chose money, and a measly 2% would measure success against follower count.

• The most interesting finding was the answer to “In an ideal world, what is your highest revenue source?” 0% of surveyed creators chose Subscriptions (below).

• ^ What’s wrong with this picture? Businesses highly prefer predictable, repeat revenue streams that help establish loyal customers. The market values recurring revenue businesses at a multiple of revenue 6-10X that of transactional businesses. So what is behind this discrepancy? Is this preference a knowledge gap between creators and traditional businesses? Is it tacit knowledge that this type of revenue won’t work for their specific business? I suspect it’s actually because of the short-term time scale that too many creators optimize for, but that’s a topic for another day.

2. Twitch is under heavy scrutiny from the music industry, and the long-term solution is nowhere in sight.

• The site and streamers are reporting heavy increases in DMCA and content takedown requests.

• Twitch has punted working on a serious Content ID system for years, and it seems like it’s time to pay the piper.

• The company’s emails to users indicate that they do not have as well established of a relationship with labels, publishers, and other rights holders in the ecosystem compared to companies such as Facebook and YouTube.

• Twitch recommends creators to “unpublish all” VODs and delete all Clips to avoid detection. 👁️👄👁️

• Music and video are inextricably tied. For Twitch to deliver on its promise as a platform for live streamers to make a living entertaining and educating fans, it needs to buckle down and starting untangling this knot to create an ecosystem that protects and rewards rights holders fairly.

General News

Established companies

Instagram will keep Likes, but lets users decide if they want to see or hide the engagement metric in app. (Instagram)

Instagram is exploring subscriptions and an NFT marketplace. Subscriptions for creators will likely entail perks such as exclusive content, similar to membership type products on other platforms. (TheInformation)

Instagram has launched “drops,” a new section under its Shopping tab for users to browse upcoming limited releases. At the same time, it’s testing ways to let short-form video creators make money via Bonus. (TechCrunch, SocialMediaToday)

Instagram’s Creator Week saw the announcement of new monetization features including affiliate commission, which is inline with Instagram’s efforts on Shopping. Zuckerberg alluded to a subscription offering where FB will take less than 30% of the revenue, positioning it favorably compared to product offerings on Twitch (50%) and YouTube (30%), and compared to mobile app stores (iOS and Android 30%). (Variety)

TikTok’s text-to-speech voice has been enormously popular in viral videos, serving as a low effort way to elevate entertainment value. But it looks like that gravy train has ended after the voice actor sued, claiming she never agreed to work with TikTok. TikTok has since adjusted the functionality, and users have noticed. (Verge)

Twitch launched market-based subscription pricing to better reflect local income and cost of living, starting in Mexico and Turkey. This led in-app purchase in Mexico and Turkey to increase by 56% and 70%, respectively. (Apptopia)

Pinterest will bring 10 creators on to its second round of creator fund. Selected creators will receive $25,000 in cash and ad credits to help them grow. (Pinterest)

YouTube published a post about its Creator in Residence (CiR) program, a 5 year old program that YouTube has not discussed publicly before. CiR brings together cohorts of creators over the course of a many-weeks long program, which includes meeting relevant product teams to share feedback and provide insights. (YouTube)

Twitter’s subscription service (Blue) launched in Australia and Canada on June 3, with a monthly cost of $4.49 AUD and $3.49 CAD, respectively. Subscribers can undo tweets, consumer long threads more seamlessly, and bookmark folders to organize tweets. (Twitter)

Google’s Area 120 (in house incubator) project Qaya is working on letting creators monetize through digital merchandize. (Protocol)

Startups

Creator Rising, a Los Angeles based start up, launches with intent to connect early-stage founders in the creator economy with investors, creators, and operator experts through its “Stimulus Program”. (CreatorRising)

Clubhouse’s Android app has ~3M downloads as it aims to resurrect the massive growth trajectory it saw in February. Based on AppAnnie’s daily download ranks, it’s unclear whether it’s working. (MoneyControl)

In a head-scratching move, Clubhouse has enabled “tipping” for all users, regardless of whether they produce live audio content on the platform. (AdWeek)

Andrew Chen (a16z) joined the board of Maven, a startup offering online courses taught by creators. The move is based on the belief that education as a category for creators is still being defined, and it has huge commercial promise. (TheInformation)

Linktree partnered up with Square on a $250,000 “Passion Fund” for creators and entrepreneurs who want to turn their passion into their career. (PRNewswire)

PickleJar, an app that lets fans tip music artists for shoutouts, special performances, and song requests, launched on May 28. Artists set the tip amounts. (GlobeNewsWire)

Poparazzi, a social app that lets users take pictures of their friends (i.e. no selfies), shot up to the #1 spot of Apple’s free apps at the end of may. The app amassed 500,000 pre-installs on the app store following its beta test. (Techspot)

Creative Trends

Role reversal — Social media stars want to gain footing as traditional media celebrities… and vice versa. Sway House is getting a reality show. Meanwhile, Brie Larson became a YouTuber (check out her ACNH skills), and Shay Mitchell is making TikToks. (NewYorkTimes)

Bestie Vibes Only — This term signifying the positive feeling between good friends gained more popularity since a viral video of a woman saying “bestie vibes only” over and over again. The original audio from her video has been remixed to create over 70,000 new TikTok videos that showcase best friends, both humans and pets. (TikTok)

Versailles Run: A TikTok AR effect that has spurred more than nearly 900,000 video creations. The AR filter turns users into Queen Marie Antoinette running through a gallery, in a campaign to celebrate cultural expression. Of course, creators have twisted the original intent of this effect to memefy it. (TikTok)

$$$

Mirror.xyz, a crypto based publishing platform, reported raised from USV (Union Square Ventures) at a $100M valuation. Mirror raised $10M+ in Seed financing from investors including USV and a16z. (TheInformation)

Snap acquired WaveOptics for >$500M. Snap uses WaveOptics displays in its new Spectacles, which are given to a select bunch of AR effect creators. (Verge)

Turntable has returned from the grave. The social music service raised $7.5M from Andreessen Horowitz, seeking to challenge social audio once more. (Turntable)

Beacons, one of the newer link-in-bio company, raised a $6M Seed round led by Andreessen Horowitz. (TechCrunch)

Poparazzzi, the “take photos of friends, not yourself” app, raised a $20M in Series A funding from Benchmark at ~$135M valuation. The app debuted at the end of May at the top of the iOS free app ranking. (Forbes)

NFT of 'Charlie bit my finger' YouTube video sells for $760,000, and remains on YouTube after the sale, despite NFT sale. (NPR) (CNN 5/23)

YouTube paid out $4B to music industry over past 12 months. Spotify announced earlier this year that it paid out $5B to the music industry in 2020. (Variety)

Articles of Interest

Apple is slowing down the creator economy. Apps such as Fanhouse are running into the iOS 30% platform fee for in-app purchases. If Apple has their way, 1000 True Fans just turned into 1429 True Fans. (TheVerge)(Stratechery)

YouTube’s bigger and more profitable than ever. In Q1 2021, YouTube’s ad revenue jumped 49% to $6B, beating the 34% growth of Google’s overall ad business. (Fortune)

As predicted, NFTs are seeing a pull back in majority of current use cases. My long term outlook remains positive as artists, creators, and tech entrepreneurs figure out a model that brings in more utility to consumers. (Protos)

To earn back Advertiser trust over the past 4 years after massive ad dollars were pulled in 2017, YouTubes has built upon its stack using the 4 R’s framework. (Fortune)

1. “removal” — finding and removing the most egregious content.

2. “reduce” — shrinking the audience of borderline videos by downgrading them with YouTube’s all-powerful algorithm.

3. “raise” — raising up trustworthy and authoritative sources, particularly on controversial topics (e.g. CDC issued revised guidance for wearing masks)

4. “reward”— i.e., promote the videos of creators who follow the rules, and enable good creators in the ecosystem to monetize.

“If YouTube were a stand-alone entity, that would make it the world’s fourth-largest seller of digital ads, after its parent company, Alphabet, Facebook, and Amazon.”

Substack, valuated most recently at $650M, plots a course for a global footprint (Axios)

Twitch turns 10 this year, and the Creator Economy is in its debt. (Wired)

Khaby Lame, a former factory worker in Italy, has become the fastest-growing TikTok creator in the world. (NewYorkTimes)

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At an event hosted by Antler Capital this week, I had the pleasure of chatting with Ollie, Molly, and Austin about the growing creator economy. The discussion centered around three questions:

1. How did we get to this point in the creator economy?

2. What are the current trends and challenges?

3. What’s coming next?

In this post I’ll lay out my thoughts on these topics. Would love to hear what others think, so if you have anything to add, Tweet at me.

1. How did we get here (2021 Creator Economy)?

Fundamentally, our arrival at this point in the creator economy can be attributed to the continual advancement of creation, distribution, and consumption technology. These three aspects progressed rapidly and in lock-step, fueled by people’s insatiable appetite for free-flowing information, entertainment, and knowledge.

Plenty has been said about why the last 18 months have been a whirlwind for the creator economy. I won’t be rehashing that. Instead, I will share a broad historic view, and a 21st century view.

Broad historic view

If we go all the way back to the 15th century, when Johannes Gutenberg invented the printing press, we have one of the earliest turning point that simplified creation and publishing of textual content.

With the first version of the printing press, it only took three years to print 200 copies of the era’s most popular book — The Holy Bible. Although that seems slow today, this was an impressive feat as the only previous option was to hand copy a book. Even in these early times, people valued information and knowledge so much that a hand-copied book costed as much as a house.

Unfortunately, the printing press was commercially worthless until the advent of a distribution network for books, long after its inventor had passed away 🪦. The lack of adequate distribution channels hamstrings the impact of even the most significant creation technology advancements.

This bottleneck is observed in the modern day as well — e-books struggled to find a market, until the invention of Kindle and other e-readers. This is why it’s critical to have progress in creation, distribution, and consumption together.

There have been numerous inflection points through the ages where creation, distribution, and consumption were made easier, and we will always be in the midst of improving creation and distribution tools. Historic examples:

• Creation: Printing press, typewriter, camera, motion picture photography, PC, software with powerful editing capabilities

• Distribution / Consumption: Literacy*, newspaper, theater, radio, TV, internet, smart phones, wearables, VR / AR

* before most people could read, literate people had jobs that entailed reading newspapers out loud to an entire town.

21st century view

If we zoom in to the last two decades in the creator economy, we see the birth of something that unequivocally improved creation and distribution by orders of magnitude, and brought the mass market UGC (user-generated content) ecosystem into existence — YouTube.

YouTube unlocked creativity by simplifying the process of capturing and sharing video for many people who had never even considered posting videos on the internet. YouTube gave the everyday Joe/Jane a voice, and opened the world to free flowing information through a high bandwidth format.

Importantly, this started a shift away from traditional media, where a few gatekeepers held all the power when it came to distribution. Up to this point, men in suits who worked in New York skyscrapers decided what / who gets distribution; they directed attention at will to content they deemed worthy, because they were the only game in town. When YouTube launched, it looked like a toy rather than an existential threat. This allowed the platform to grow while the gatekeepers in power ignored it.

Fast forward 15 years, and the internet has matured in ways that allowed similar platforms to grow and facilitate easier connections between people and content. Over this time period, gatekeepers continued to lose control over distribution, because creation and consumption experiences had become much better elsewhere.

Consumption behaviors have largely shifted from traditional media (TV and newspapers) to digital content platforms. Today, the titans of yester-year are mere shadows of their former selves. The US Newspaper industry serves as one data point, where revenue has fallen from $38B in 2008 to $13B in 2020 (-66%). Terrestrial radio has held steady in comparison, but one has to wonder how long it can last.

What really propelled the incredible surge in people becoming creators are highly visible, outlier success stories. Creators and artists such as Justin Bieber, NigaHiga, Casey Neistat, Liza Koshy, Emma Chamberlain, and Ninja grew on these platforms and became iconic household names. They firmly laid the foundation for more adults to become at least part-time creators, and seeded the examples that led 75% of kids to dream of becoming content creators.

2. What are current trends & challenges?

There will be a wide range of answers depending on who you ask, what role they play in the ecosystem, and where they are in their career. I will focus on a few very common challenges for creators.

Challenges (Opportunities)

Distribution remains difficult. As a creator, you have better creation tools than ever, but so do all other creators. With easier creation, there’s now more content being published than can ever be consumed.

This means distribution remains a challenge, but the nature of the challenge has evolved. Today, the issue is no longer a lack of a microphone, it is rising above the noise of all the other microphones.

Being rewarded fairly remains unsolved. On the content distribution side, platforms are still trying to figure it out. YouTube paid $30B to creators and publishers in the past 3 years, more than 65% of its revenues. Last year alone, YouTube paid out $4B to the music industry.

Even so, the large majority of YouTube creators would fall below the poverty line if YouTube were their only source of income. Meanwhile, TikTok creators amassing millions of views a month are getting paid peanuts without a brand partnership.

There’s a ground swell of start ups focused on rewarding creators. They will need to figure out how to unlock the power of community with BYOA, because the incentive structure of existing distribution platforms inherently lead to some limitations that are difficult to change.

Creators are getting over the fear of “selling out” as they branch into new businesses. This is great for the ecosystem. Even the renaissance had to be funded by patrons.

Burnout. This is both common and severe. Creators on every platform fear that their fans will forget them if they take a vacation. Ninja famously “lost” 40,000 subscribers over a short break, which roughly nets out to -$2.4M in annual subscription revenue.

Companies have learned that sustainable lifestyles lead to healthier, more productive employees that contribute to the company’s goals over a longer period of time. How do we transfer this knowledge to creators to help them with longevity? Burnout should not be a foregone conclusion for creators who find success.

Safety. We’re spending more time online than ever, along with that is more bad stuff (e.g. egregious violence, hate speech, exploitation). How we remain safe and keep future generations safe is a matter that cannot be punted down the road. This is a problem that affects creators and consumers alike, and companies are aggressively staffing up Trust & Safety teams to work on this problem.

“There’s no time”. When I asked 20+ creators — all with a certain level of success, earning 6 figures or more — about their biggest challenges, more than half answered with this. They each wanted to try branching out with new content and business ideas, but they can’t. They’re too busy doing everything on their own.

One concrete step that successful creators need to take is invest in their own growth by collaborating with others, and delegating aspects of their business. Winning creators find a way to focus their energy on where they alone can deliver unique value.

Recent Trends

More disintermediation. For creators, advancements in decentralization such as NFTs represent a future where they can own, nurture, and monetize the community relationships they’ve built on their own terms. Meanwhile, Social Tokens represent an opportunity to further align fan and creator incentives by offering fans partial ownership, future upside, and access to a creator.

The inconceivable height of recent NFT sales has been reminiscent of The Renaissance, where art (e.g. The Last Supper, The Birth of Venus) was often commissioned by wealthy patrons.

The NFT hype is bound to die down in the medium term, but over the long term (10 years), creators and artists will use this paradigm shift to unlock the uncapped value from their casual followers and super fans.

Creators —> Businesses. This is a big one, and it’s here to stay. Now that successful creators have shown what can be done, the world has taken note. Countless startups have formed to help creators manage their budding businesses, elevate their craft, and make money. At the same time, creators themselves are experimenting with more businesses beyond content — merch, digital products (e.g. courses), creator brands (e.g. MrBeast Burgers, Emma Chamberlain Coffee). We are about to witness business-minded creators teleport to the next level.

An interesting branch of this theme is investing, specifically, how company are investing in creators (CreativeJuice, JellySmack), and how creators are becoming investors and owners (Nebula, Atelier Angels). With distribution power, cultural clout, and loyal fans, creators can be incredible additions to startup cap tables.

Fan funding. Fans want to help creators succeed and make a living. Companies seem to be announcing tipping, subscription products, digital goods features every month.

Collaboration. This is an infinite, positive sum game, and creators are wising up to it. They're making time to be together to allow co-creation, cross-promotion, mutual learning to take place naturally. As I said previously:

More creators are recognizing this, and putting forth explicit efforts to be in proximity of each other so that there’s more opportunity for frequent collaboration. More of these projects such as Launch House are popping up lately.

Creator Funds. Platforms bridging the income gap between emerging creators and established creators. Platforms including TikTok, YouTube, and Snap have announced creator incentive funds to encourage creators to choose their platform as the place to create and distribute content.

The incentive funds across the board are veiled in mystery in terms of criteria, but serves as a short-term way to reward short video creators who otherwise are not making much money, if any.

Creator / Brand Marketplace. Brands need to earn awareness, favorability, and trust with consumers. In 2021, people have grown numb to traditional ads, and consumer trust can’t just be bought with ad dollars. Trust is earned over time, which is exactly what creators have done over years of consistent content output and relationship building. So brands are re-allocating their ad dollars from traditional ads to partnerships with creators, who bring positive association, consideration, and sales.

As brands see more success with this tactic, they allocate more of their budget to it, which leads more brands to follow suit. In the meantime, platforms are noticing this trend, and are building platform-owned marketplaces (Instagram, TikTok), where they can create lock-in and extract more value.

3. What’s coming next?

The time scale we’re looking at provides an important frame of reference to consider. Progress in the near-term will center around iterative improvements around the challenges and trends outlined above.

Foundational work will be done by incumbent platforms and startups to poke at what it means to advance the creator economy. However, the more interesting blue sky opportunity lies in where we’ll be in 30 years.

30 years from now…

• A much higher proportion of the population will be creators. There will still be a spectrum of different outcomes as creators, but more of us will actively create.

• Creation and distribution capabilities will improve beyond our imagination. Perhaps even our ability to consume will be enhanced.

• More creator businesses will flourish into major brands and media empires.

• Tools and technology will exist to help creators directly monetize the deep relationships and trust they build with their fans.

• Content will be more ever-present than today, in mediums that aren’t possible today (immersive mixed reality and virtual reality), fitting into parts of our lives in ways that are infeasible now (playing video games when we’re driving).

• The Metaverse will be mainstream, and we as a society will spend a significant portion of our lives in the Metaverse, which means the surface area for how we engage with content and creators increases exponentially.

If we zoom out to a 30 year time horizon, these changes are inevitable, and I can’t wait to get there.

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Distribution platforms like YouTube and TikTok will always have an important role in the creator economy. But with the rise of Bring Your Own Audience (BYOA) platforms, there’s a new sheriff in town.🤠

In this post I will dive into:

Why it makes sense for creators to lean into BYOA

1. Creators don’t want to build a home in a war-zone.

2. Creators need a community platform beyond content.

3. Consumers want more ways to interact with and financially support creators.

What the rise of BYOA will mean for the creator economy

1. Symbiotic co-existence with distribution platforms

2. More & better creator-centric products

3. Accelerated innovation

Let’s go!

Exhibit A: New Platform Winners

Over the past couple of years, companies such as Patreon, Onlyfans, Shopify, and Gumroad are quietly (kind of) gaining momentum.

What do they have in common? They’re all BYOA platforms, meaning creators drive their fans to use these services.🤑

Let’s talk about the reason this makes sense for creators, and why BYOA will thrive alongside distribution platforms while ushering in more creator-centric products.

First, what are BYOA platforms?

Bring Your Own Audience (BYOA) platforms focus on enabling value generation for creators who lead an existing fan base there.

BYOA’s core value is not top of funnel discovery, there is no algorithm creators have to dance around to get eyeballs. With BYOA, the creator’s job is to drive traffic to the BYOA platform, and the platform’s job is to convert that traffic into creator value.

Contrast this with a traditional content distribution platform, where the winning formula is to ensure consumers see the content that results in more time on the platform, so that ads can be shown to generate ad revenue.

BYOA is creator centric. Distribution platforms are consumer / advertiser centric.

BYOA comes in two flavors: 1) let creators deepen the strength of their community, 2) help creators convert their social capital to financial capital. Creators think of these platforms differently than places where they distribute content.

• Content distribution platform: (TikTok, Instagram, YouTube)

• BYOA platforms for monetization or engagement: (Patreon, Gumroad, Discord)

Flywheels are all the rage these days, so “funnel” is probably cheugy here. If you’d prefer, think of discovery as the initial turn of the flywheel, and engagement as the accelerant that propels the flywheel to its next loop.

Note: The chart is not meant to be scientific. It is a snapshot of my perception of these platforms, and things do change quickly. Twitter has made 6 acquisitions in the past 6 months, condensing a multi-year creator ecosystem strategy into a year. It is probably much more focused on creator monetization than ever. Likewise, companies including Discord and Reddit are adjusting course to better serve creator needs.

Why BYOA makes sense for creators

1. Creators don’t want to build a home in a war-zone

Creators want to direct traffic to BYOA places because they see it as home base — a place of their own — rather than a competitive arena where they fight with others for attention, judged by an almighty, black-box algorithm.

Once creators have earned consumers’ attention in a crowded bar called Twitch or Facebook, BYOA is the creator version of: “let’s get out of here, I know a spot😉”.

• OnlyFans has grown on the back of Reddit as a free marketing channel, where adult content creators market themselves through popular R-rated subreddits. Reddit itself is not conducive to building the creator’s home as it is the place people go for content fit for the forum context. Once consumers arrive on the OF page of a creator, they’re immersed in the world of the referring creator.

• Shopify integrates into brand sites, enabling merchants to own the direct online storefront experience with their end customers…

  …because your site in the open web is the only place you own. On any other services you pay for an impression or you’re renting it from someone.

  - Tobi Lütke (Founder, CEO of Shopify)

• On BYOA platforms such as Circle.so, creators can organize, showcase, initiate, promote, and sell in ways that give them much more control. This level of space customization is not afforded on distribution platforms where the concept of Profiles / Pages / Channels are intentionally generic to serve the lowest common denominator needs. This goes back to difference of BYOA platforms’ creator-centricity vs. Distribution platforms’ consumer-centricity.

2. Creators need a community platform beyond content

It takes time to create awesome content, so creators aren’t publishing new content constantly. Between the podcasts, live streams, and banger TikToks, creators need a community platform where they…

“…foster a community that loves them, get feedback on content and ideas, and lets super fans form strong connections” - Creator with 1M+ fans on social

When done well, community unlocks the power of the crowd. It removes the creator as the bottleneck for starting interesting conversations, new friendships, and iconic inside jokes. With the collective creativity and knowledge of everyone in the community, people help, educate, and entertain one another while being connected through a mutual fandom of the creator or topic.

A deeply engaged community is also what makes a creator valuable as a brand, beyond content. As creators become more successful, engagement is far more crucial than follower count. Depth of engagement is a key aspect that brand deals (largest income stream for top creators) are based upon when creators partner up with brands.

Content distribution platforms can also build community engagement features into their product, but they only work in the context of content (e.g. polls on live streams, comments on photos). The community features on distribution platforms that extend beyond content will be me-too features, and likely an afterthought unless they prove engagement-positive or revenue-positive. Easier said than done.😅

3. Consumers want to interact with and financially support creators

…in ways that content distribution platforms can’t or won’t support. Why?

Interactions:

Recall that content distribution platforms make >95% of their revenue from ad revenue. They’re not in the business of monetizing community experiences, they’re in the business of monetization attention.

So for platforms, the incentive to facilitate a non-monetizable conversation between fan and creator is much lower than the incentive to push users to consume more content that can be monetized.

Community builders would argue this is short-sighted and that healthy communities can take >1 year to develop before paying dividends in ways the company can really appreciate in metrics. I agree :) but the reasons platforms optimize for short-term outcomes are a multitude, and that’s a topic for another post.

Financial support:

Platforms get the best return by optimizing their advertising revenue engine, and that’s where they put forth their biggest effort. That makes sense. But for creators, ads revenue is usually not their biggest source of revenue (except at a particular stage of success just before brand deals).

Creators also monetize through other streams such as merch lines, pay gated content, and exclusive interaction experiences. None of these are natively supported with the flexibility that would satisfy the wide spectrum of creators we know and love today.

It’s worth noting that distribution platforms have invested quite in the opportunity of fan funded monetization over the past few years. The success is hard to ignore, some of these products have grown tremendously on big distribution platforms.

However, there is a perception from some creators and consumers that the platform cut is too high, and uneven (i.e. top creators negotiate more favorable terms). The prevailing standard is a 30% platform cut, which is accompanied by another 30% Apple Store / Google Play tax if purchases are made in app.

This has led to the new wave of standalone utilities such as Kofi, micro-tipping services offering more favorable revenue sharing terms for creators.

The most recent features from big platforms seem to catch onto the trend too, with Twitter and Clubhouse essentially turning digital goods product opportunities into money-transfer services where the platform takes a 0% cut of the “tip”.

Besides “tipping” features, BYOA platforms also offer more favorable revenue splits on subscriptions. For example, OnlyFans takes a 20% cut for subscriptions, compared to a 30% cut on YouTube memberships, 50% cut on Twitch subscriptions, or 80% cut on revenue from traditional adult content / cam sites.

It is valid to say that sites like OF can only take a lower cut because 1) they do not offer the myriad of utilities, conveniences, and value adds that YouTube does, and 2) they are a new player that needs to offer a more palatable deal to kickstart creator acquisition. But this does not change what creators see: “more for me”.

What does this mean for the creator economy?

Three takeaways. One emoji — 📈

1. Symbiotic co-existence with distribution platforms

BYOA brings focus and flexibility onto aspects of creator businesses that don’t fit within the confines of distribution platforms.

They will help creators win by elevating community building and community monetization to the next level. BYOA platforms will thrive in tandem with distribution platforms, which are necessary but insufficient on their own to unlock a healthy middle-class of creators.

2. More & better creator-centric products

I firmly believe that over the next 5 years, even more BYOA platforms will emerge to offer streamlined and tailored solutions to creator needs.

Meanwhile, existing community platforms such as Discord will tune their strategy to propel the ecosystem to new heights by unlocking more community and monetization potential for creators.

3. Accelerated innovation

As creator-centric startups continue to rise, it also brings competitive pressure for distribution platforms to improve their own offerings faster. It’s been happening already, and here are some developments from just the past year:

• Acquisitions, Spaces, Tip Jar, Super Follow from Twitter

• More fan funding and membership options on YouTube

• Direct fan-to-artist payments on SoundCloud and Spotify

Regardless of the specific feature, incumbents are forced to respond to existential competitive moves that reveal latent demand in the marketplace.

For creators, this means more options in more places to make a living doing what they love. What a time to be alive as a creator.

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Not every week will be a news roundup, but this was an eventful one so here we go.

General News

With its Android release, Clubhouse opens itself up to the other 87% of the connected market. Its strategy is to continue growing in a controlled fashion by extending its invite-only model. The founders seem to be wary of the hyper-growth induced outages and notification failures on its iOS product, and want to take a cautious approach with Android rollout. (Clubhouse)

Discord has become the hangout spot of choice for communities of all shapes and sizes (150M users). Last week Discord announced a rebrand, alongside an early rollout of ticketed events. Creators (including actors, musicians, and servers mods) have long desired to earn money from the awesome community experiences they create. What better place to do it than where the community already lives? (TechCrunch) In April, Discord was rumored to have turned down a $12 billion acquisition offer from Microsoft, but its CEO was tight lipped during his appearance on Bloomberg🤐.

Spring and Bondly team up to offer NFTs sales for creators. Bondly was the company behind Logan Paul’s first NFTs, and with this partnership, it is aiming to scale broader fan engagement into a revenue stream for more creators. An interesting aspect is embedding perks and utilities (e.g. interaction with creators) directly within NFTs. Web 3.0 has been dubbed the new 'internet of value', and this is exemplified through direct value transfers between creators and fans. (PRNewswire)

Instagram is gearing up to host an invite-only Creator Week to “help creators build their community and grow their businesses”. (Variety)

Watch out LinkedIn, TikTok is launching a feature to help Gen Z find jobs (Axios)

New feature alert: TikTok is testing a way to allow creators to boost videos (get views) by paying. The feature is not widely available yet, but could be an early sign of things to come. How will monetizing creators instead of monetizing consumers and brands work out? How will this lead to an uneven playing field for creators?🤷🤔 (TikTok)

YouTube joins TikTok and Snapchat in announcing a new creator fund,unleashing a $100M war chest to entice creators to use YouTube Shorts. TikTok announced some time ago that its own creator fund would grow to $1 billion over 3 years. (TechCrunch)

GLAAD social media report finds top content sites ‘categorically unsafe’ (Axios). This report, alongside another research study on child safety on popular internet platforms, indicates that despite efforts in Trust & Safety, there remain significant gaps to keep children safe online. Given the importance of keeping children safe, there could be more regulation coming. One recent children related regulatory change was in regard to COPPA compliance, which sent ripples through a segment of the creator economy.

TikTok launched various developer kits including Sound Kit, which open up how creators can use off-platform music in their creation workflow. Sound Kit is integrated with music creation apps including Audiobridge, Landr, Rapchat, and Yourdio. This makes for a bridge that brings music artists into the creator economy. (TikTok)

Li Jin comes with another haymaker, this time calling out Apple for operating its platform business with too much with its product mentality, which hold back the advancement of the greater creator economy (and of course developers). (Li’s Substack)

Brands want to be a part of the cultural moment. Not because it’s cool, but because it sells. To get in on cultural moments that are often started or accelerated by creators, various platforms are betting on platform-owned creator marketplaces, facilitating connection between brands and creators as part of the in-app experience. Simultaneously, they’re investing in first party shoppable-content features that let consumers purchase items directly as creators tout them. (HollywoodReporter)

Relatedly, TikTok is testing in-app shopping products. “Executives explained that the company intends to replicate its success with AI-recommended videos in online shopping. By scrolling an endless stream of content linked with physical goods, the startup aims to hook shoppers the same way lip-synching videos enthralled a generation of American and European teens.” (Bloomberg)

Businesses typically tag their products in TikTok’s social content, with links directing buyers to their own sites, but users still technically stay in the TikTok app. Facebook and Instagram let merchants either set up their in-app storefronts or channel users to third-party services.

Now TikTok aims to lock users inside its ecosystem to a greater degree. Brands like Hype will run dedicated stores on the video platform, taking orders from and interacting directly with shoppers. While TikTok won’t handle sales or merchandise itself, it hopes to sell more ads to merchants, boost traffic and take a cut of business.

Creativity Trends

Creators are making parodies of the original dance trend from Starboi3 and Doja Cat’s hit song by replacing “p***y” with movie quotes or impressions. (TikTok)

Netflix and Adobe partnered in an open invitation to TikTok creatives to make a trailer for an untold story that resonates with them personally. The winner from #TheGreatUntold will have a Netflix short film made based on the trailer. (TikTok)

Bruno Mars’ “Leave the Door Open” is inspiring a wave of humorous videos ridiculing conversations between people such as couples, or with parents. (TikTok, Reel)

YouTube analyzed its treasure trove of data to break down how vlogging creators around the world greet their viewers. Spoiler: The winner is “hey guys!”. (YouTube)

A recent trend in hot tub live streaming (draw your own conclusions) has resulted in an indefinite ads-eligibility removal for long time Twitch streamer Amouranth, without warning. Is this a sign of things to come as platforms struggle to balance content acceptability with advertiser friendliness? (BBC)

$$$ 

Collective, a company that helps creators to operate as businesses by handling operational tasks such as accounting and taxes, announced its $20M Series A round led by General Catalyst. (TechCrunch) In the same week, Lili, a startup focused on solving banking, payments, finance management, and tax needs for freelancers, raised $55M in Series B Funding led by Group 11 (TechCrunch). The space for helping creators run their business is heating up 🔥 as multiple entrants are tackling the problem from different angles. Keep an eye on this space for creators as things kick into overdrive in the coming months. When Stripe advances their Treasury product even further, new creator-focused Neobanks and companies such as Karat, Stir, Collective, and many others will be vying for creators to receive / send / store / analyze money through their respective platforms.

#fypsounds, a startup that lets audio artists monetize their sounds or music on Instagram and TikTok, moved from invite-only into launch last week. “FYP” = For You Page, which has been TikTok’s secret sauce for consumer engagement and creator distribution. This is critical for the Short Video ecosystem, as music has proven to be inexplicably important to the entertainment value of popular trends. (FYPsounds)

Allstar, a company that aims to turn gamers into stars through highlight worth game play clips, raised a $3.85M Seed round led by New York Angels. (InsiderVoice)

Thinkific Labs, a platform for online course creators, went public recently. Over the past year, it grew paid subscribers by 115% to 27,500, while ARPU improved by 15% to $106, and ARR increased by 134% to $34.8 million. (Thinkific)

Jellysmack, a company that helps video creators grow and monetize, raised a Series C from SoftBank, which has backed other companies in the creator economy, such as ByteDance and Cameo. (Stockhouse)

Lastly, here’s an interesting excerpt from Economist on the New Rules of the Creator Economy. This perfectly highlights how incumbent platforms, who were chugging along on the ads gravy train, are now feeling pressure to adjust their strategy in face of existential competitive threat.

…platforms that once paid little or nothing to creators are ponying up. Companies “need to either offer some way to monetise that content on-platform, or…they'll become just a promotional hub, where people essentially advertise the content that they're monetising on other platforms”…

…Twitter was in danger of becoming a promotional tool for Substack writers and Clubhouse broadcasters. It is now trying to beat both at their own game. In January it bought Revue, a newsletter firm, and cut its commission to 5%, half Substack’s. On May 3rd it added Spaces, a Clubhouse-like audio feature; soon it will let users sell tickets to chats they host. The ability to sign up for a newsletter or join an audio room directly from Twitter, without the friction of moving apps, gives the company an edge over its startup rivals.

What a time to be alive as a creator.

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The creator economy is also in a unique moment. Relevance is at an all time high. The whole world seems to be rooting for it to succeed, and every week another company is raising $50M or $100M to serve the needs of creators and communities.

Here are a few key updates to keep you informed.

General News

Established players

Twitter starts rolling out Tip Jar, which lets users transfer money through third party payments services including Cash App (Verge) 

Twitter rolled out expanded access to Spaces, allowing users with 600+ followers to host a live audio conversation. Users with large followings can use “Ticketed Spaces” to monetize. Hosts determine # of tickets available, and ticket prices, and Twitter gets an unspecified cut of the revenue. (TechCrunch)

Instagram reveals captions stickers, which turns your words into text subtitles in Stories. Instagram says it will also begin testing them Reels. TikTok recently launched this feature to make its app accessible for more people, while increasing the entertainment value of video outputs. (Verge)

TikTok, Snap, and Facebook now each has a platform owned marketplace to connect creators with brand sponsors. The influencer marketing agency space has grown tremendously in the past decade, but now face competition from distribution platforms, which may offer much better pricing to creators due to their infrastructure. For now, the big platforms have taken a stance to not require a cut of sponsorships that creators ink off-platform. (Variety)

Twitch, like other video platforms, was a beneficiary of the pandemic stay-at-home period. Its mobile appsaw 22M downloads in Q1 (+62% YoY). (SensorTower)

Snap snags Charli & Dixie D'Amelio as part of its new original shows lineup. (Variety)

The Epic and Apple war rages on. Tim Sweeney (Epic CEO) is framing the debate as Apple harming not only Epic, but also a variety of businesses, including creators. “Epic is trying to build a metaverse where the majority of the profit should go to the creators themselves. With Apple taking 30% off the top, it makes it very, very difficult for Epicand creators to exist in this world.” (TheInformation)  

Start up scene

Clubhouse’s had about 900,000~ downloads in April, down 66% compared to March, and down 90% compared to February. Can Clubhouse survive? (BusinessInsider).

Clubhouse announces a variety of different creator shows as part of its accelerator program, complete with a monthly incentive package for creators. (Clubhouse)

Popshop Live and Supergreat continue to double down in the US on live commerce, a ~$100 billion dollar global industry. (Glossy)

Bright, a new live video platform enables creators to monetize interactions with super fans through Pay Per View live-video, in exchange for a 20% revenue cut. The D'Amelio sisters and Ashton Kutcher are among early users. (TechCrunch)

Antler Capital released an updated map of creator economy companies, covering 220+ global companies. Audience monetization showed up strongly, as did creators business operations tools that strive to help creators run the backend of their business. (Antler)

Creativity Trends

Creative execution

Whether it’s TikTok, YouTube Shorts, or Instagram Reels, Music and Short Form Video are inextricably tied.

The latest reminder of this is the new trend that gave new life to “Hope” feat. Faith Evans. TikTok creators started the trend by spoofing movie endings where updates are flashed on screen about what characters do after the movie ends. (examples: TikTok,Instagram Reel) 

Another example of a music bolstered trend features “A Thousand Miles”. Creators are pairing the song with ridiculous remarks from family members, students, or bosses as “inspirational quotes”. (TikTok, TikTok) 

TikTok is diversifying beyond comedy, dance and music videos. Recent popular genres include #TeachersOfTikTok (9.2B views), #MentalHealthAwareness (3.3B views) #EarthDay (4.5B views), and #SupportSmallBusiness (2.1B views).” (Forbes)

Keeping up with Gen-Z

TikTok creators without traditional media affiliation are acting as curators who aggregate and deliver news in entertaining fashion to their massive audiences on TikTok. This is the TikTok wave of homegrown Philip DeFrancos. (WashingtonPost)

“I want to be the translator from mainstream media to teenagers.” - DiPaola

Bonus: Know ‘Cheugy’ means? Neither did I, fellow old person. (NewYorkTimes)

$$$ 

Kajabi, an eCommerce startup enabling creators to sell memberships and online courses, raised $550M in its latest round led by Tiger Global, with a >$2B valuation.

Mighty Networks, a community building platform for creators to engage with and own their audience, closed a $50M Series B, led by Owl Ventures.

Genies, a platform for creating 3D avatar, closed a $65M Series B led by Mary Meeker’s Bond Capital. Genie will launch a new NFT platform in partnership with Dapper Labs, the company behind NBA Top Shot and CryptoKitties.

Discord, a popular community / communication platform, announced a Series H round a short while ago, making it a $7B company. Sony participated in the round, and is integrating Discord with PlayStation Network.

Twitter acquired Scroll, a $5/month subscription service that removes ads from participating news websites. The deal is Twitter’s 6th deal in 6 months to bolster its subscription offerings and general efforts toward serving the creator economy.

Bitski, a service that lets people make and sell non-fungible tokens (NFTs) on the blockchain, raised $19M in a Series A led by Andreessen Horowitz.

Metafy, a marketplace for competitive gaming coaching, extends its Seed round to $8.65M, led by Forerunner Ventures, Seven Seven Six and DCM.

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