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We’ve Raised $60M in New Funding
- alexroan 9y agoShould've just set up a Patreon page for Patreon.
- IshKebab 9y agoThat's how Gratipay does it: https://gratipay.com/Gratipay/ https://gratipay.com/Gratipay/ But they're only getting enough to pay for like, 1/10th of a developer...
- badosu 9y agoAlso, Bountysource: https://salt.bountysource.com/teams/bountysource https://salt.bountysource.com/teams/bountysource What amuses me is how software projects prefer Patreon instead of Bounstysource
- dkersten 9y agoReally? I've not yet seen any software projects on patreon.
- countdownnet 9y agohttps://www.reddit.com/r/linux/comments/5omtvg/patreons_to_support_open_source_projects_please/ https://www.reddit.com/r/linux/comments/5omtvg/patreons_to_s...
- shevy 9y agoMany twitch streamers prefer patreon. I have no idea; just stating that I noticed it when watching some twitch events.
- dkersten 9y agoTwitch and YouTube streamers - sure. I see a lot of them. But, software projects? Or so you mean these streamers are streaming while they code or whatever?
- whit537 9y ago> only getting enough That's because total volume is so low. Back when it mattered we were seeing 5% of volume as income to Gratipay, comparable to Patreon, etc.
- k__ 9y agoit's sad that content creators have to beg for money or litter their stuff with ads :/
- GauntletWizard 9y agoEveryone has to sell. They're not "begging", they're offering a service: I keep doing art. That's a pretty good service to me.
- minimaxir 9y agoProducing content is never free. (if not in monetary cost, then in time/opportunity cost) It is not "begging" so to speak; if anything, it's a win-win.
- sheraz 9y agoIt's sad that you think it is begging. I think if it as patronage, something that is baked right into the name of the service. begging implies some kind of charity. Patreon is enabling one exchange of value for another. Very different IMO.
- deleted 9y ago[deleted]
- Spivak 9y agoA little, but people using these tip sites are generally in an awkward spot. They make content that lots of people enjoy but it's not valuable enough that people would directly pay for it. The opportunity costs of actually paying quickly eclipse the value of the content so people choose to do without. It's the same situation with a lot of paid apps.
- firmgently 9y agoI wish I could get my head around this, I'm an artist and people tell me my work is good and I do sell some, but I can't bring myself to go on to Patreon because I feel like it's begging (although weirdly I only apply this to myself, I don't think badly of other people that do it... but then I don't look down on people who beg anyway, I grok St. Francis of Assisi so I'm not sure what all of this means). Meanwhile I've moved into a caravan and often have trouble affording to eat (luckily I'm still a bit fat haha).
- probably_wrong 9y agoCould someone explain why Patreon needs to raise funding? I thought a service built with the express concept of collecting money (and a very popular service at that) wouldn't need external funding. Also, in an unrelated point, > I had been making YouTube videos with my band, Pomplamoose Finally! I thought I was crazy for thinking it was the same guy. If you haven't listened to his band, you definitely should.
- cryptoz 9y ago> Could someone explain why Patreon needs to raise funding? I thought a service built with the express concept of collecting money (and a very popular service at that) wouldn't need external funding. I don't know the details of Patreon, but profitable companies raise money all the time. Patreon is presumably a startup, and has growth in mind. It is likely that they want to grow faster than their current cash flow would allow - in fact, they may need to do this in order to survive in the long term. A more in-depth description of this from pg: http://www.paulgraham.com/growth.html http://www.paulgraham.com/growth.html
- s73ver_ 9y ago"It is likely that they want to grow faster than their current cash flow would allow - in fact, they may need to do this in order to survive in the long term." Do they really, though?
- semperdark 9y agoThe TechCrunch article about the funding [0] claims they make about $7.5 million a year, based on their transation fee and some public "total payments" numbers. I can see that being too little if they're hiring a significant number of people. This is a nontrivial dilution so I assume that they need the money. [0] https://techcrunch.com/2017/09/14/patreon-series-c/ https://techcrunch.com/2017/09/14/patreon-series-c/
- dkersten 9y agoApparently they employ 70ish people. That's essentially the 7.5m gone on payroll.
- raesene6 9y agoI like the patreon model, as it's let me support various creators whose content I like (Webcomics/Websites/Musicians) without having to endure web ads. I get what this post is saying about wanting to add new features, but I can't help but be a little apprehensive about what taking this amount of external funding means for Patreon's future. It doesn't strike me as a business that's likely to experience "hockey stick" growth, so there's a worry that they'll need to extract more money from existing creators to show the return on investment that their external investors are likely to seek...
- replicatorblog 9y agoRight. How many features do they need to add? Kickstarter raised a few million dollars and has grown organically, and fairly rapidly, since. Who is the natural acquirer for Patreon? Is it a likely IPO candidate? It's cheap criticism to say that it would be an easy extension for Kickstarter to offer this kind of funding model, but it really would. The cultural barriers that usually keep companies from moving into adjacent areas are non-existant. Both companies serve the same "Creative Class" customer with nearly identical positioning. I'm long Kickstarter, moderately short Patreon.
- chx 9y agoI support my favorite musicians on Patreon and usually get gadgets on Kickstarter although I admit I supported the occassional video game or novels. But Patreon is about continous delivery while Kickstarter is about one big bang, delivery is on the several months-1/2 years scale while Patreon doesn't work well if you don't deliver a thing every month preferably more than one. Seems like a completely different thing.
- unkown-unknowns 9y agoIf someone on Patreon becomes really popular then Patreon could earn good money from that without changing their fee structure. It could happen. But I wouldn't bet on it.
- teej 9y agoIt really depends on how sticky the patrons are, which I would guess is very sticky. A dollar in advertising revenue that Snapchat books isn't as valuable as a dollar that Patreon books for a lot of reasons, but primarily because they have a direct-to-customer relationship and because they generate predictable subscription income. I would think about the Patreon opportunity as such - 1/ Patreon has built a platform that has proven to be the best way for artisans and creatives to create a direct connection to their fans 2/ Since the inception of the company, they have seen very strong improvements in artist growth, patron growth, and retention in both. 3/ The total addressable market is huge. Every creative is a potential user. Their platform may even be growing the market by allowing people to quit their normal jobs to pursue creative ideas. 4/ They want to raise the money to build new functionality to continue to drive growth by addressing new segments of creatives and improving the product to drive retention. In summary, I think Patreon has a compelling story for raising money. They need to spend money to grow but not like Snapchat because the consistency of their cash flow is a major reason to continue to invest in retention.
- mbillie1 9y agoI haven't paid much attention to how they run as a business but I am a happy consumer, I get 2 excellent podcasts from Patreon at a price I am happy to pay. Hope they stay in business.
- countdownnet 9y agoFor those wondering why Patreon went for more funding even though they should make about $7.5 million this year from the 5% fee they charge: They are growing faster than their current cash flow can handle and need to increase their staff beyond the 70+ they already employ. They are still a "young startup" where they can get this sort of funding where a standard growing business would get a loan.
- countdownnet 9y agoIf you want to see how creators on Patreon are doing: https://graphtreon.com/top-patreon-creators https://graphtreon.com/top-patreon-creators
- stingraycharles 9y agoThis still doesn't strike me as a very satisfying answer. "growing faster than their current clash flow can handle" can also be phrased as "they are spending too much money". Big investments always raise big expectations, and can ruin a perfectly fine business (model). Why are they spending more than they earn ? At this valuation, it seems like they are going to need a unicorn exit at some point. How are they planning to do that ?
- eganist 9y agoBusiness loans are granted all the time on the basis that a company demonstrating profit or a plan to reach profitability (this scenario is more constrained) should theoretically be able to pay the loans back. Investment rounds are similar in this way but tend to address the "plan to reach profitability" or "plan to exit" scenarios more directly than a loan might. Patreon's making money, but Patreon needs to stay ahead of current and potential competitors, continue to expand, and continue to grow their positive cash flow. Sure they could keep going without raising investments, but if they run the risk of being disrupted by competing implementations of the same business model (a very real risk), it'd be stupid not to raise money to accelerate their growth.
- rockarage 9y ago
- sctb 9y agoPrevious discussion: https://news.ycombinator.com/item?id=15254069 https://news.ycombinator.com/item?id=15254069
- stcredzero 9y agoAnd there are dozens of you making over $30k per month!! Is there any way of browsing these creators? How many creators make money at the rate of $40k per year? Also, is there a typical curve that earnings follow over time?
- countdownnet 9y agohttps://graphtreon.com/patreon-creators https://graphtreon.com/patreon-creators Some creators have their earnings private.
- otakucode 9y agoThe biggest earners are, to the best of my knowledge, mostly adult artists. Not porn stars, but artists who create erotic artwork, often for 'niche' communities. I imagine Patreon does not want to shout too loudly about that sort of thing, but I am extremely glad they are there making the world a better place. Our culture can never be made 'advertiser friendly' overall and its disgusting to see the degree of puritanical prudishness on display at most tech companies. They are stultifying human culture and actively preventing actual humans to be the ones determining what constitutes our culture. Patreon works directly against that, and for that they are angels. If they ever move to boot adult creators, that will be the day Patreon dies. If they ever get bought by Google or some other tech titan, it will be that day instead.
- stcredzero 9y agoA plurality is marked NSFW, not a majority. Also, the population of creators that make $40k per year or more is about 350.
- otakucode 9y agoI love Patreon but am scared for them. As more and more YouTube creators find it untenable to survive on revenue from YouTube (which is something YouTube wants to happen, IMO) and they turn to Patreon... that puts Google in a difficult position, serving basically as the free-cost video host for those creators who likely won't bother putting ads on those videos either. And if Google makes a big to buy Patreon, I REALLY hope Patreon would refuse it no matter how large it would be, but I can't imagine anyone walking away from 'never have to work again' money. Google buying Patreon would cause me to wear black and mourn for at least a month. They would move aggressively to remove all creators who do anything not deemed 'advertiser-friendly' (really anything that wasn't mainstream in the early 2000s when Google came about, which is where Schmidt wishes to petrify human culture) and then progressively move to make it less and less possible for people to make a living doing things which members of the public wished to support. Such a model does not lend itself to what Schmidt sees as the proper structuring of society, with centralization of wealth into a ruling minority class establishing the 'pillars' of society, any widespread movement looks to people of his perspective like rats chewing through those pillars. He made a smart move publishing his book where he puts forward the idea that Google should use its position and power to actively 'guide' human culture for the good of the peons not as wise as he. If he'd published it online, people would read it.
- shevy 9y agoUnfortunately I fear that Google has become too big for the whole world and will slurp up everything that can be a competition, just like they slurped up youtube too at one point in time. And we all know that money moves people, so there is that - github, patreon, twitch. Google has things to buy.
- kypro 9y agoI don't think that's likely. Here's why: YouTube doesn't have to worry about major competitors because of the network effect. If it bans people from YouTube, where are they going to go? To a competitor video site no one uses? Sure, they could, but they're not going to have much success considering how unlikely it is that their entire audience will go through the hassle of signing up for the competitor's service and then remaining active on it (while likely still using YouTube) just to watch one person's content. But with Patreon there isn't a similar network effect at play. You just log in and subscribe as a Patreon. There's no real need to log in every day, or week. There is no additional benefit you get from it being the largest service of it's kind either. So if Google did buy Patreon and they did start banning people, I don't see much reason why someone couldn't just create a successful clone. Creators would even have a reason to use the new service over Patreon given they'd be less likely to loss their revenue stream by simply linking their audience to the new competitor site instead. Sam Harris recently started pointing his audience to his own donation service instead of Patreon for this reason, there really is no real cost to either the creator or subscriber doing this, I'd guess Sam probably even takes a larger cut of the donation money.
- shevy 9y agoPretty nice success story. Unfortunately money changes the way how companies work - and often not to the better.
- monkeypizza 9y agoI wish they'd take Craigslist's path - simple, small, and providing amazing value.