In Emerging Leaders Week, there were many discussions on storytelling. Industry professionals placed good storytelling above good design, advertising, and marketing. This made me think about the donor-based business models. As the content creation industry develops, creators feel the need to come up with new and intriguing serialized content. To support on-time delivery of the content, creators have given consumers the opportunity to help by setting up accounts on Patreon and the like. The key to creating a revenue stream from being creative is to build an audience. Storytelling of any sort needs to find its audience and when it does, things do take off as Kurtis Baute’s YouTube channel did.
Patreon is a crowdfunding site for ongoing content creation, not single projects of the type Kickstarter is targeted at. Patreon helps build a community around an artist and gives them the opportunity to try out crowdfunding and see if it works for them.
Lupa, a nature enthusiast and a costume creator from Oregon, Portland, speaks about her Patreon experience. She likes the fact that she has a bunch of people interested in what she creates and are willing to help her out financially; she feels that it boosts her creative abilities. Lupa explains that Patreon takes a sizeable cut (from $531 in pledges at the beginning of the month to $463 in her bank account) which is more than the 5% cut Patreon talks about in their FAQ.
Like with Facebook, Instagram, and Google, the challenges of a business model rising to be the best in its category is the amount of care given to the actual consumer. The people who pledge donations on Patreon are doing it purely out of goodwill to the artist(s). The challenge with one dominant business model is when it fails to evolve. The sign of growth is constant change and evolution. With business models of today, successful evolution becomes a difficult beast to slay. Patreon had been going at it with 85% of all pledges going to the creators until 2017 when they announced the change: creators were now going to get 90% of all pledges. This sounds great, right?! But this change was at the expense of the pledgers having to pay extra to cover up for that 5% gap. In other words, this made it more expensive to support multiple creators, to support creators who made more than one thing per month, or to support creators with a small donation.
The biggest challenge is trying to figure out a way to monetize the value and hard work that goes into creating content; then trying to charge the creator and the donator a fair amount for an exchange. It will be a happy day if someone can figure out an honest way to do so on the “Internet of Things”.