The thread's title points to a CNBC story by Brandon Gomez. However, the journalism is very light and is missing a lot of context about what CEO Jack Conte is

The thread's title points to a CNBC story by Brandon Gomez. However, the journalism is very light and is missing a lot of context about what CEO Jack Conte is talking about. However, a better story that Dan Olson linked to (scroll down his twitter feed) is the September 2017 announcement of the $60 million round by Jack Conte himself[0]. In that blog, JC laid out in more detail the new products Patreon was trying to build to increase revenue. Excerpt of the bullet points: 1. Business Infrastructure - Think of this as the back office — the tools, workflows, dashboards, and information that you need to get your business cranking. [...] analytics [...] financials [...] 2. Rewards to Energize Patrons This is everything you need to entice and keep your patrons, [...] Actual goods, whether digital or physical, like a signed poster or an extra episode [...] Patreon doesn't want to be just a simple "paypal/stripe" payment middleman that takes a 5% cut of subscribers payments. As a rough analogy, they also want to be a "SalesforceCRM/QuickenAccounting" backoffice and a "Amazon/WooCommerce" for merchandise -- for their creators. JC is hoping that creators will give up more than 5% (e.g. maybe 30% cut) to pay for those services. So when people ask "what does Patreon need all that VC money for?", JC basically told you. The question remains if the creators are willing to pay for those extra "value-added" services to manage the creators' backoffice + storefront. (Examples of those "new features".[1]) I think we can assume that the bullet points laid out in JC's blog post roughly match the Powerpoint slides he showed to the VCs to convince them to invest more money. In fact, if you look at their Crunchbase profile[2], you'll notice that in the 3 rounds A & B & C, he had the same VCs repeatedly investing more money: Thrive Captial and Index Ventures in 3 of the rounds. And StartX and Accomplice in 2 out of 3 rounds. Not only did JC convince a VC to invest more money, he convinced the same VCs multiple times. Both JC and the investors did not think of Patreon's business as a "simply take 5% cut of payments and that's all we do forever". Maybe they will be proven wrong in expanding the Patreon platform ambitions but I think we can at least see why the $100 million investment doesn't look "illogical" to them. [0] https://patreonhq.com/new-round-funding-816d5a592477 https://patreonhq.com/new-round-funding-816d5a592477 [1] https://blog.patreon.com/new-membership-features https://blog.patreon.com/new-membership-features [2] https://www.crunchbase.com/organization/patreon#section-funding-rounds https://www.crunchbase.com/organization/patreon#section-fund...