Almost six years ago, musician Jack Conte wondered if fans of musicians—and podcasters and cartoonists and other creative people—would be willing to commit to paying a few bucks per month to support the folks whose work they loved. Along with cofounder Sam Yam, he turned the proposition into Patreon, the startup Conte now leads as CEO. It turned out that millions of fans were happy to use Patreon to give money to creators on an ongoing basis. And now the San Francisco-based company is releasing new stats that show it’s still growing rapidly.
“At the beginning of last year, we announced that we had sent $350 million [in total] to creators, and this year we’re going to pass a billion,” says Conte. “And a half a billion of that is going to come from this year alone. We’ve now got 3 million patrons who have active, recurring memberships with our creators.” (That’s up from 2 million patrons a year ago.)
The top Patreon creators are dazzling success stories, reeling in tens of thousands of dollars a month. Others make enough to subsidize a rewarding side gig. And some who give the service a shot don’t get very far (which is why, Conte says, the average monthly amount netted by a creator is negligible). The company has been busy spending some of the money it’s raised to help more creators gain traction as well as bring new kinds of mini-media empires into the Patreon fold.
Last year, for instance, it introduced “Special Offers,” a feature that allows creators to temp prospective patrons with a benefit—such as a piece of merch or getting their name in an upcoming book or album—if they commit to a specific patronage tier within a given timeframe. “It’s been incredibly impactful,” says Conte. Patreon also acquired acquired Memberful, which provides white-labeled membership services to creators who’d prefer to focus on their own brands rather than jump aboard Patreon’s bandwagon.
Additional growth may come from making the service more truly international. “Right now, Patreon’s business is skewed toward the U.S., because we’re dollars and English,” says Conte. “As we expand that, I think we’ll see considerable growth overseas.”
Back in 2013, Conte came up with the idea for Patreon because he was frustrated by the challenge of turning vast quantities of YouTube views into a cut of the video giant’s ad revenues that was larger than minuscule. Recently, however, YouTube has introduced its own Patreon-eque membership features. Conte says they have some momentum—and that’s okay: “I think it’ll just be a strong signal that we need alternative forms of monetization other than ads to fund the creative ecosystem.” Then there’s Facebook, which introduced its own functionality last year to allow fans to pay creators. “To us at least, it doesn’t seem like it’s getting a ton of traction,” says Conte.
Patreon’s own future as a business will be dependent on the money it makes as a intermediary between fan and creator. In December 2017, the company announced plans to revise its payment structure in a way that would have added a transaction fee to pledges—and then quickly undid them when the creator community revolted, concerned that the change would discourage small pledges. Does it have any news about future adjustments to its business model? “Not yet,” says Conte. But given that the company has had more than a year to mull over the lessons from its 2017 kerfuffle, it might not be that much longer until it takes another pass at a revamp.