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Lot's of people are basically asking why Patreon ever needed $60m VC money and why couldn't it have just emerged into a sustainable little platform for creators

Lot's of people are basically asking why Patreon ever needed $60m VC money and why couldn't it have just emerged into a sustainable little platform for creators. I think the answer is here: >The new capital will go towards hiring to expand its 80 person team and scaling up growth by recruiting more creators including videographers, political pundits, game developers, illustrators, musicians, and comedians. Patreon was doing a Netflix. Patreon is a platform and it needs content on it's platform to draw people in. So it used the $60m to bribe creators to sign up. Without that $60m someone else could very easily have created the same platform, bought all the big content creators and squished Patreon over night. It was about establishing their network effect. Now they've effectively done that, they're the defacto place for this. So now they need to extract value from the position they're in. It makes perfect sense to me. It's not great for consumers - it's basically buying a network effect driven monopoly, but isn't that basically 80% of what silicon valley is doing today?

jasode 8y ago
>Patreon was doing a Netflix. [...] So it used the $60m to bribe creators to sign up. I haven't seen Patreon do this. Can you link to stories where Patreon has paid for original content creation similar to how Netflix/Amazon/HBO funds original content? $60 million would be a very tiny warchest to pay for producing original content. I think the $60 million (~$100 million total) is being used to expand the platform's services for creators' such as backoffice and ecommerce. I wrote in more detail about that strategy in my other comment.
AnIdiotOnTheNet 8y ago
This seems weird to me. Patreon isn't really a platform, at least it isn't considered as such by any of the people I patronize. Their platform is youtube, or software. Patreon is just a way they get their work funded by people like me. As was shown during patreon's last big fuck-up, it is pretty easy for people to pack up shop and get their money through some other channel.
- edanm 8y ago
  That doesn't mean they're not a platform, just that they're a platform with very limited lock-in effects. (I like Patreon, but I kind of agree with this)
- mst 8y ago
  I believe Naomi Wu (@RealSexyCyborg) would beg to differ - I think she only managed to get 300/800 patreon subscribers to follow her to subscribestar (before it got eaten by the culture wars)
  - AnIdiotOnTheNet 8y ago
    300/800 isn't a meaningful statistic. What percentage of her funding did that account for?
    - pc86 8y ago
      Even if it's 75% of revenue on only that 37.5% of patrons, that still means it's not "pretty easy" to move to another service without taking a massive hit in revenue. Don't underestimate the network effects at play for something like this.
      - mhb 8y ago
        How is this a network effect? It's just inertia - it's inconvenient for the patrons to move their accounts.
        mst 8y ago
        Except if they have other people they patronise on patreon, they aren't looking at moving their accounts, they're looking at creating an extra one. And people leaving patreon entirely is often even worse because they often do so over a boycott by a well known account, in the process depriving lower tier creators they previously supported on there of revenue.
- 8y ago
WesleyLivesay 8y ago
Judging by the amount of emails I get form them I think a good portion of those new people are part of their Creator Growth team (or whatever they call it). In the last year there has been a huge increase in Patreon created content trying to make creators better at getting more patrons.

jasode 8y ago

>Patreon was doing a Netflix. [...] So it used the $60m to bribe creators to sign up. I haven't seen Patreon do this. Can you link to stories where Patreon has paid for original content creation similar to how Netflix/Amazon/HBO funds original content? $60 million would be a very tiny warchest to pay for producing original content. I think the $60 million (~$100 million total) is being used to expand the platform's services for creators' such as backoffice and ecommerce. I wrote in more detail about that strategy in my other comment.

AnIdiotOnTheNet 8y ago

This seems weird to me. Patreon isn't really a platform, at least it isn't considered as such by any of the people I patronize. Their platform is youtube, or software. Patreon is just a way they get their work funded by people like me. As was shown during patreon's last big fuck-up, it is pretty easy for people to pack up shop and get their money through some other channel.

edanm 8y ago
That doesn't mean they're not a platform, just that they're a platform with very limited lock-in effects. (I like Patreon, but I kind of agree with this)
mst 8y ago
I believe Naomi Wu (@RealSexyCyborg) would beg to differ - I think she only managed to get 300/800 patreon subscribers to follow her to subscribestar (before it got eaten by the culture wars)
- AnIdiotOnTheNet 8y ago
  300/800 isn't a meaningful statistic. What percentage of her funding did that account for?
  - pc86 8y ago
    Even if it's 75% of revenue on only that 37.5% of patrons, that still means it's not "pretty easy" to move to another service without taking a massive hit in revenue. Don't underestimate the network effects at play for something like this.
    - mhb 8y ago
      How is this a network effect? It's just inertia - it's inconvenient for the patrons to move their accounts.
      - mst 8y ago
        Except if they have other people they patronise on patreon, they aren't looking at moving their accounts, they're looking at creating an extra one. And people leaving patreon entirely is often even worse because they often do so over a boycott by a well known account, in the process depriving lower tier creators they previously supported on there of revenue.
8y ago

WesleyLivesay 8y ago

Judging by the amount of emails I get form them I think a good portion of those new people are part of their Creator Growth team (or whatever they call it). In the last year there has been a huge increase in Patreon created content trying to make creators better at getting more patrons.