“A platform is not your friend”
Ten years agoIf you were a rowdy kid who somehow made a living off of YouTube ad revenue and branded business, you’ve probably been told that you don’t have a real job. When you pay your rent by monetizing your creative output, you are part of the Creator Economy, a vibrant new industry.
A Often cited landmark report of venture capital firm SignalFire says creatives are the fastest growing type of small business. Although the creator economy only really took shape a decade ago, there are 50 million people who call themselves “creators” and, according to SignalFire, more American children want to become YouTube stars (29%) than astronauts (11%). Hence, it makes sense that more and more startups are emerging to provide tools for creatives – it’s an opportunity to capitalize on a growing market and savvy entrepreneurs want to make money.
As this market expanded, I wrote about it Credit card company for creative people, Community building tools and Companies that help you develop a product for sale, among other ventures. But with my inbox teeming with too many YouTuber-focused startup pitches, products, and opportunities to even be considered, I’ve noticed a disturbing trend: not all of these companies are really good for the YouTubers they want to serve. Some could actually be quite predatory.
For example, if an all-in-one creator platform collapses, what does that mean for creators who all lay their eggs in that basket? How do big technology acquisitions affect the people who make money on these platforms? As Venture capitalists invest in creators As if they were startups, how can these creators protect themselves from exploitative conditions?
Startups need to have a backup plan to ensure that the makers who trusted them aren’t doomed if they don’t become the next Patreon.
Startups need to have a backup plan to ensure that the makers who trusted them aren’t doomed if they don’t become the next Patreon. I’ve started asking these questions to any startup that claims to be a “one-stop-shop” or “all-in-one solution” for the creator economy. Fourth wall had a good answer.
The company said it has reserved three months for emergency operating expenses to ensure that if they fail, they can help developers move to other platforms. Fourthwall also said it would make its platform open source if that should happen. But regardless of that, this friction isn’t exactly helpful.
The inherent tension within the creator economy lies between the promise of financial freedom and the realization that that freedom has its price. As more and more startups seek to connect talent with branded offerings, develop monetization tools, and develop new social platforms, YouTubers need to know what to look out for to avoid a bad situation – and startups themselves need to think they can are of a creator, knowing that when a creator entrusts him with his business, he has a moral and financial obligation not to screw it up.
“A platform is not your friend”
When Spotify bought of popular podcast creation service Anchor in 2019, podcasters panicked. But Amanda McLoughlin, CEO of the independent podcast collective Multitude Productions, had seen such massive acquisitions before. McLoughlin has been a creator herself since the beginning of YouTube, so she has seen the industry change from both a creative and a business perspective. A pivotal moment in her early life as an internet creator was when Google bought YouTube in 2006.
“Before 9 a.m., I got a dozen messages from friends and colleagues worried about what such a large and unexpected consolidation would mean for those of us trying to make a living on podcasts,” McLoughlin said wrote then. So she put the lessons she learned from the YouTube takeover on the table: diversify your revenue streams, don’t trust individual platforms too much, and believe in your own worth.
