Not so long ago, the information and entertainment industry was dominated by a few big players. TV, radio, and newspaper were the major mediums used by most people to consume content.

The trend continued for a long time. But as the internet evolved, so did Web 2.0 – the web where users were not just consumers, but creators. People started creating content and sharing it with their communities. Individuals became the producers and their own brand managers.

This trend caused a revolution in the way content was produced, distributed, and consumed. And all this led to the development of the creator economy.

This article takes a look at the creator economy and all you should know about it.

• What is the New Creator Economy?
• How do You Become Part of the Creator Economy?
• What is the Value of the Creator Economy?
• Who Coined the Term Creator Economy?
• What is Creator Economy in Metaverse?
• Why is Creator Economy Growing?
• How the Youtube Creator Economy Works
• 5 Things you Need to Know About the Creator Economy
• When Did the Creator Economy Start?
• How Big is the Creator Economy in India?
• What is Creator Monetization?
• Creator Economy Examples
• Creator Economy Market Size
• Creator Economy Startups
• What Drives the Creator Economy?
• Is Etsy Part of the Creator Economy?
• Which is a Creator Economy Platform?
• How do Creators Make Money in the Economy?
• Is the Creator Economy Sustainable?
• How do Content Creators Make Money?
• Is the Creator Economy Web3?
• Creator Economy Trends
• Creator Economy Stats
• How Big is the Creator Economy?
• How Much is the Creator Economy Worth?
• Why Creator Economy is Important
• Where is Creator Economy Heading?
• Creator Economy for Brands
• Creator Economy Companies
• How the Creator Economy is Transforming Hollywood
• Creator Economy in Web3
• Creator Economy and NFTs
• Creator Economy Business Model
• Creator Economy Blockchain
• Creator Economy Blogs
• Creator Economy Course
• Creator Economy Investors
• Creator Economy vs Gig Economy
• How Much Does the Creative Industry Contribute to the Economy?
• Creator Economy Global Market Size

What is the New Creator Economy?

The creator economy is defined as an economic system built by independent content creators who are connected to their audiences and businesses via the internet.

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Creators are people who create, own, and distribute the content they produce to their audiences. The content is in the form of text, podcasts, music, videos, digital books, games etc.

These creators monetise their expertise by sharing content on ad-sponsored platforms, partnering with brands, charging subscription fees, providing services etc.

These creators are infopreneurs who use content creation to communicate with their audiences and engage them. The audience in turn can support the creator monetarily by engaging with the content, paying for it, or making them their opinion leaders and purchasing from the brands these creators endorse or are associated with.

How do You Become Part of the Creator Economy?

Joining the creator economy is actually pretty straightforward. And while getting started isn’t overly complicated, finding success does require patience and a good strategy. Here are four steps to help you along the way!

Step 1: Find a Niche

Finding success in the creator economy is more likely if you have a good niche. There are more than 50 million creators to compete with. Picking a highly specific niche will limit your competition and help you stand out. 

For example, many creators have built followings by publishing videos showing their processes. Josie Lewis is a painter who has gained a massive fanbase by sharing her unique “chunky paint” technique online.

Focusing on a less competitive topic will give you a better chance of attracting followers.

It’s also helpful if you have prior knowledge, expertise, or interest in a niche and can use that to produce a lot of high-quality content. 

Step 2: Create Content

The next step as a creator, of course, is to create. With the rise of TikTok and Facebook Reels, video content is an excellent medium to consider. Content other than videos can also be viable, though. 

For example, the Shawn Ryan Show interviews members of elite military groups for an inside look at special forces operations. These interviews are available as videos via YouTube and a hosted platform or podcasts from Apple and Spotify:

Depending on the type of content you create, certain platforms will be more effective than others.

For example, many comedians have found success in short video mediums such as TikTok, Facebook Reels, and Instagram Stories. Meanwhile, creators of how-to guides are typically more successful on YouTube.

However, these platforms usually take a steep cut of your profits. For example, YouTube takes 45%. 

Step 3: Build an Audience

The goal of creators is to grow their audiences. Fans (or students, for instructors) are the currency of the creator economy. Fans or students translate to reach, views, and sales.

For example, Ryze Hendricks’ Weird Bars series has helped earn him over 5 million followers on TikTok. He’s now selling his own albums and performing live concerts.

Building an audience starts with offering quality content. However, it depends on more than just that.

Multi-platform marketing and search engine optimization (SEO) techniques can also help you reach new viewers.

Step 4: Monetize Your Content

Once you’ve built an audience, it’s time to monetize your following. You can use several methods to accomplish this. These techniques may be influenced by the type of content you create, your platforms, and your desired strategy.

Paid advertising is one of the most common monetization strategies, especially for video content. You can find a company with a similar audience to yours and share their ads alongside your content.

Plus, many platforms, such as YouTube, make it easy to monetize your videos by handling most of the ad process and enabling you to embed advertisements.

However, as we mentioned, this comes at a cost.

Like advertising, affiliate marketing is a more active way to monetize an audience. Rather than including passive ads with your content, you can promote products or services directly to earn commissions.

However, it’s best to promote affiliate products related to your audience’s interests

Finally, the most direct way to monetize your content is to actually sell it. For example, some creators put premium content behind a paywall.

What is the Value of the Creator Economy?

The creator economy is estimated to be worth more than $100 billion, and more than 50 million people worldwide consider themselves creators, but the vast majority are amateurs.

There are about 2 million professional content creators, and nearly half of them earn their money on YouTube. Instagram places second with about 500,000 pro-creators, and Twitch’s live streaming service has about 300,000. For the 48 million amateur creators, Instagram is the number one option.

One of the most well-known ways to earn a living is by creating video content people want to watch, and YouTube’s Partner Program was one of the pioneers in this space. It was built in 2007, and if a creator meets the criteria to join, they can put ads on their videos. YouTube takes 55% of the advertising revenue, and creators keep the remaining 45%.

Meta, the Facebook and Instagram parent company, is playing catch up in this space. It just recently announced a similar deal for creators. It will also allow creators to keep 55% of advertising revenues while the company takes 45%. It focuses on the Instagram Reels feature, which can also be shared on Facebook.

TikTok is rolling out a new way for creators to earn money on its platform. TikTok Pulse allows advertisers to insert brands into the platform’s top 4% of videos. But creators must have at least 100,000 followers to participate in the program’s first phase. Until now, the only way brands could advertise with TikTok creators was through affiliate marketing.

Who Coined the Term Creator Economy?

The “formal” creator economy emerged circa 2012, as platforms like WordPress, YouTube, Instagram, and Facebook empowered everyday people to cheaply produce and distribute their content. While social media giants originally relied on free user-generated content to attract advertisers, creators began demanding compensation for bringing traffic and ad revenue to these sites.

Creators also began to get “discovered” on these platforms. Singer-songwriter Shawn Mendes and pop star Justin Bieber each showcased their talents on Vine and YouTube respectively, further affirming that creators could become lucrative assets to both brands and the platforms that host their content.

The term “creator” was coined by YouTube in 2011—as an alternative to “YouTube star”—to describe users with a large subscriber base who weren’t “celebrities” in the traditional sense. 

What is Creator Economy in Metaverse?

The metaverse—seen as a digital environment powered through virtual and augmented reality technologies—is set to herald a new era in content creation.

Experts believe the metaverse will transform the creator economy and the nature of decentralization. CEO of KuCoin Johnny Lyu says the metaverse will “change the paradigm of content creation,” while Rory Kenny, CEO of Loudly, says that content creators will play an integral part in creating the metaverse space owing to their established social media presence. The metaverse, according to Kenny, is set to reshape the creator economy, which has already exceeded a $104 billion market size, into a multibillion-dollar industry. 

Yet the metaverse is still a nebulous, non-singular concept. It’s often likened to dystopian visions or pop culture references like Ernest Cline’s Ready Player One and is characterized as a collective interactive platform where users can put on headsets to not only communicate and socialize but also trade goods, services, and experiences. Besides, any company can create its own metaverse independent of other existing worlds.

Why is Creator Economy Growing?

There are several factors that contribute to the rapid growth in creator space and boost the creator economy. Some of these common factors include

The rise in internet usage and the globalization of content consumption

According to datareportal insights, by the start of April 2021, over 300 million people worldwide started using the internet in the past 12 months. The annual change in the number of global internet users is more than 7.6%. The demand for creative content will likely grow with the world becoming more digitized.

With wider internet access, the market gap between the supply and demand side of the creator economy narrows. Wireless infrastructure and last-mile internet reach are surely giving an economic boost to localized content to reach a global audience. In the next few years, we will likely see high volume growth in the creator economy.

Disruption in formal employment opportunities

Ever since the pandemic outbreak, there have been massive job losses and an increase in countless job-seekers. Fresh graduates had to sit idle at home. Some of them jobless and creative artists became overnight sensations. In 2021 itself, the 50 million creator economy escalated to $14 billion. Creators now look for additional revenue sources and flexible job culture empowered by remote work technologies.

Many small businesses collaborate with influencers and online creators to boost brand visibility and attention. By leveraging these influencers’ voices and reach, many could ensure business continuity and increase their sales. In fact, boosting the creator economy is the dire need to compensate for the lack of formal job opportunities.

• YouTube is considered the birthplace of the creator economy, and a report outlined its contribution to the YouTube Partner Program (YPP).
• Oxford Research found that YouTube’s creative ecosystem supported 394K equivalent jobs in the United States in 2020, paying over $30 billion to creators, artists, and media companies.

The popularity of short-form video content

Video is now the most popular form of content on the internet, and people are continuously looking for new and interesting videos to watch. People love short-form video content as it is easy to consume and can be watched on any device. People watch short-form videos while on the go and are also more likely to share them with their friends. You can learn or get a good laugh within minutes by watching reels or short videos.

• According to a HubSpot report, 85% of marketers consider short videos as the most effective video format on social media.  In 2022, brands will focus more on short-form educational videos focused on how-to’s, DIYs, and explainer videos.
• People are increasingly turning to short online videos for entertainment, news, and even education. More and more students and teachers are using short-form educational videos to supplement traditional classroom instruction.

An increasing number of creator economy platforms and tools

A lot of content creators look for different ways to monetize their work. Now there are many monetization platforms helping creators earn a decent income from their work.

• One of the most popular monetization platforms is YouTube. You can create videos and then monetize them through ads. You can even join the YouTube Partner Program, which gives you a share of the revenue from the ads shown on your videos.
• Educators now possess multiple no-code and easy solutions like LMS to create, integrate and monetize their educational content.
• Video security mechanisms like DRM, which used to be available only for Google and Apple, are now available to everyone through Authorized license partners like VdoCipher. Earlier the creators had no option to tackle their video piracy problem and eventually had to face revenue loss.
• Another popular monetization platform is Patreon. With Patreon, you can create content and ask your fans to support you by becoming patrons. It may be a good earning source if you have a large audience base.
• Several platforms also specialize in selling digital products, such as ebooks, courses, and other types of content. These platforms can be a great way to monetize your work if you have something of value to sell. Find the right platform for your content, experiment, and see what works best for your specific situation.

Many creators are moving beyond popular earning models like sponsorships and Patreon towards new and innovative monetization methods. Be it NFTs or workshops or developing own brand into a full-scale business. Not all models seem to prove successful, but some certainly will.

Bond of trust between Creators and Audience

Creators have become the key players for brands to reach targeted audiences. Many creators build their audience on social media by promoting their knowledge and talents. Their admiration or reputation roots in their creativity and unique individuality.

Multinational companies engage with the mass audience with unique campaigns involving famous creators instead of big celebrities. Creators now have the power to connect with unrepresented groups and nations, which is a big opportunity for creators and companies.

Communicating with creators can take many forms, including leaving comments, sending messages, or following their social media handles. When fans take the time to communicate with creators, it shows that they are invested in what they are doing and that they are willing to support them. This can go a long way in building trust between fans and creators.

In some cases, the close relationship and bond of trust between fans and creators allow for the wrong transmission of inaccurate and misleading information. Some creators even take undue advantage of the trust fans put in their favorite creators. There have been plenty of examples of content creators propagating wrong and conspiracy theories. 

Investment in creative content

Investing in high-quality creative content is wise for businesses of all sizes. After all, compelling content is one of the most effective ways to reach and engage your target audience. It helps build trust and credibility, drive your website or business traffic, and generate leads and sales. Since 2020, venture capital has invested $850 million into the creator economy.

The growing number of unicorns in the creator economy shows the huge potential for venture capital investors, startup founders, and creators. This type of investment into the creator space sends a strong message that the creator economy is a big force to be reckoned with. According to Crunchbase data, funding for startups focused on creative content in 2021 was $939 million.

Creators are doing what they like to do and are best at what they do while delegating out the things they are not good at. There is a need for other tools to help creators run their work, such as hosting videos, managing revenue, contacting brands and businesses, hiring resources and more.

• LinkedIn announced a $25 million fund via its Creator Accelerator program
• Pinterest built monetization tools and launched a $500,000 creator fund
• YouTube added a $100 million fund just for Shorts, its TikTok-like feature
• In 2020, TikTok, after a $200 million fund, launched new monetization features

How the Youtube Creator Economy Works

The Creator Economy is a software-enabled economy that enables creators to profit from their work. Twitch, Substack, OnlyFans, Lightricks, YouTube, Instagram, Collaction, Spotify, TikTok, and Patreon are examples of creative economy software platforms.

For decades, “big media” ruled the entertainment and journalism worlds. What the majority of us read, watched, and listened to was controlled by a small number of corporations. We should be hired by one of these media conglomerates, or at the very least appear in their stories, to contribute to the conversation.

Instead, we watched pre-recorded television shows, listened to radio spots, read newspapers of journalists following their editors’ commands, read books and magazines from major publishers, and spent evenings at the movies, viewing pictures distributed by a few studios.

The Creator Economy does not entirely correspond with the invention of the internet. It took a long time to realize the internet’s full potential. Indeed, it corresponds to Web 2.0, a period in which the internet’s fundamental paradigm shifted.

People discovered other potential uses, such as social media and video sharing, and ceased using them solely for gathering information and storage purposes. The Creator Economy arose out of Web 2.0’s myriad opportunities for people to express themselves online.

5 Things you Need to Know About the Creator Economy

These are a few important things that leaders need to know about the creator economy’s growth: 

1. Accessibility

The usage of mobiles in the present decade has risen drastically to 6 billion and is expected to grow by more than a hundred billion in countries like India, China, the US etc. This rise has also led to an increase in the viewership and usage of social media, increasing access to almost everything.

2. Reach

The rise in demand and supply of mobiles has created easy accessibility and isolation during the pandemic and has acted as a catalyst to double the audience at turbo speed. The audience type is wide and can be segregated through influencer selection.

3. Tracking

Marketing through the information creator economy can be measured in-depth through elements like age, geography, gender etc. The audience and marketing strategy method can also be aimed at making proper choices of influencers (types of followers) and direct or indirect methods.

4. Monetisation

The Creator economy has loads of money flowing in the market. High ROI is leading the investors to pump in huge money. Among the purchasers, around 31% of buyers make purchases through influencer advertisements on social platforms.

5. Growth

The content creation industry has been growing drastically. The content creation reach has been growing dramatically and has a wide reach. There are around 50 million content creators.

Creator economy is one of the vast marketing media of the present era and an effective medium to reach out to lenders and Millennials, the age group with high spending power. Social trends and technological advances will add to the increase in the market share of the Creator Economy Growth.

When Did the Creator Economy Start?

Starting around 2012, a new small business category emerged, known as “the creator economy”. You’ve probably heard this buzz phrase before, but what does it mean?

The creator economy is another name for all small businesses run by independent content creators. These creators are usually people like…

• Social media influencers,
• Streamers
• Internet personalities
• Online instructors, and the like

The category can also extend to the tools these creators use to monetize and grow their revenue.

How Big is the Creator Economy in India?

In 2021 alone, $1.5 Billion was invested into India’s creator economy startups. Out of which, $1.2 Billion went into discovery platforms (to fill the void left by TikTok). And rest was invested in monetization platforms and a few creator tools (that you can count on your fingers).

From 2018 to 2022, over $2.5 Billion has gone into India’s creator economy startups.

The big creator economy thesis is a mix of many more thesis and trends. One part of it is that there’s huge change in the consumer behaviour. People like to buy products from the Internet and they prefer authenticity over advertisements. Which gave rise to influencer marketing, making it a $10 billion+ industry in 2021.

Then came the video streamers, product reviewers, online educators, writers/bloggers, affiliate sellers, digital product sellers, merchandise sellers, and many more to establish new monetization methods. While the money in the influencer marketing was flowing directly to the creators. The platforms got a chance to facilitate alternative monetization for creators and also command a percentage of that money.

The overall market of the creator economy is around $104 Billion globally. Which includes the discovery platforms, monetization platforms, and creator tools.

What is Creator Monetization?

As a creator, the first step to earning money is to post high-quality content and build a base. Creators can upload their content to social platforms to receive a share of ad revenue, accept donations on creator-first platforms, or monetize content directly on their own websites. 

Podcasting

For podcasters, sponsorships are the most common way to make money. This means creating an ad spot to promote an affiliate offer or including a mention of a product or service as part of regular content. Brands provide a tracking link or coupon code so the influencer receives credit for sales they generate. Podcasters can also accept crowdfunding and donations through podcast hosting platforms. 

Influential podcasters can charge a subscription fee for exclusive content, such as additional interviews, behind-the-scenes content, or an ad-free version of the podcast.

Blogging

Bloggers can make money through ads, affiliate marketing, sponsored posts, and selling other services. For example, freelance copywriter Elna Cain runs a blog about freelance writing, which she also uses to promote her copywriting, SEO, and email marketing services. 

Bloggers with a sizable following can join an ad network to host ads on their site. Most of these networks use targeted ads, meaning the ad changes depending on the viewer’s recent site activity, which is tracked using cookies. Bloggers can also join affiliate networks to promote a company’s products using a tracking link.

The blogger then receives a commission when someone makes a purchase via their link. Professional writers can also offer paywall-restricted newsletters on their own website, or through content platforms like Substack. 

Videos

One of the most common ways to monetize video content is to upload videos to YouTube. Creators must have at least 1,000 subscribers and 4,000 watch hours in the past year to apply for YouTube’s Partner Program, which allows creators to monetize their channels through ads, subscriptions, and channel memberships.

YouTube takes a 45% cut, and the creator gets the rest. Video creators who specialize in tutorial videos or video lessons can monetize their content directly by putting videos behind a paywall on their website. 

Influencers

Influencers are social media personalities whose authority has the power to affect their viewer’s purchasing decisions. Brands hire influencers to create sponsored posts or to serve as brand ambassadors. Instead of promoting a brand through a one-off sponsored post, brand ambassadors regularly discuss the brand’s products to generate brand awareness, usually in exchange for a monthly stipend. 

Art & Design

NFT (Non-Fungible Tokens) marketplaces and stock image sites allow creators to sell digital art, photography, and video in exchange for royalties or commissions. While homeschooling her five children, generative artist Melissa Wiederrecht made extra income by contributing seamless patterns to stock image sites. Selling art online is a “numbers game,” says Wiedderecht, a graduate of Springboard’s Data Science Career Track. She currently has over 24,000 images for sale on Shutterstock.

“It’s totally possible to make a full-time income creating, uploading, and selling seamless patterns on Shutterstock,” said Wiedderecht. “I’m not there yet, but it’s totally possible.”

Creator Economy Examples

Examples of creator economy software platforms include YouTube, TikTok, Instagram, Facebook, Twitch, Spotify, Substack, OnlyFans, Tiki and Patreon.

Using platforms like YouTube, Instagram, Snapchat, Twitch, TikTok, Substack, Patreon, and OnlyFans, content creators can earn money through:

• Advertising revenue shares
• Sponsored content
• Product placement
• Tipping
• Paid subscriptions
• Digital content sales
• Merchandise
• Shout-outs
• Live and virtual events
• VIP meetups
• Fan clubs

Creator Economy Market Size

When you talk about any market size you have to look at the individual pieces that make up the whole puzzle. Content creators are at the center of the creator ecosystem but there are also platforms/tools that help them operate as a business and investors that fund these startups.

Over time creators grew in numbers, polished their skills, found ways to monetize their content, and became solopreneurs. This expansion created space for creator economy startups to be born, offering platforms, tools, and services that enable creators to maximize their potential, both as businesses and as content creators.

According to Crunchbase’s database, there are more than 300 creator economy startups that provide services through every step of the creator work cycle, from content creation to off-platform monetization to audience management.

In the beginning, creators didn’t have many choices in terms of the platforms they used to share content. YouTube, Instagram, and Facebook were the conglomerates that had taken over the Internet. Naturally, creators gravitated to these platforms the most.

As the creators’ needs changed, more creator platforms started popping up. Content creation tools, streaming platforms, sponsorship marketplaces, other social media platforms, selling services, big crowdfunding platforms, etc. They offered better tools and services than the tech giants that dominated the space, allowing creators to diversify their online presence and revenue streams.

Creator Economy Startups

Below are 10 of the most noteworthy creator economy startups in 2022:

1. Passionfroot

Passionfroot is a berlin-based creator economy startup that has made it its mission to empower creators to feel less overwhelmed and protect their creative spark while building their platforms and businesses. Passionfroot is a workspace where creators can manage their business and organize their finances, serving as a sort of “back-office”.

From content planning, payment processes to collaboration management and more, Passionfroot aims to unify various tools creators use to run their business. The platform is launching soon for beta users so sign up and secure a spot!

2. Pallet

The founders of Pallet believe that the future of hiring is distributed and community-driven. Their goal is to unlock talent in professional communities through a job board for creators. Communities on Pallet can monetize via posting jobs to their audience, or recommending candidates from their audience directly to businesses.

Pallet is a creator economy startup that offers an opportunity for creators to have a two-sided marketplace instead of selling to their audience in a one-sided value exchange.

3. Stir

Stir is a financial platform for creators to manage their revenue streams, and analytics as well as collaborating and splitting revenue.

It is a more efficient way to collect payments on brand deals and send payments to collaborators. The platform enables instant bank-to-bank payment without any attached fees which is a great alternative to PayPal which takes 2.9% of the transaction. Stir has already been able to get popular creators on board such as Casey Neistat or Colin and Samir. Stir was declared one of the top 50 most promising startups by “The Information”.

4. Kajabi

The creator economy startup Kajabi provides a platform for creators to turn their knowledge and passion into income. On the platform, creators can build, market and sell online courses, membership sites, coaching programs, podcasts and more.

Kajabi also offers marketing tools and templates for content and campaigns as well as an option to manage CRM, payments connected to Stripe and PayPal and monitor analytics. It is a single dashboard where creators can access their website, products, marketing and communities.

5. Fanhouse

Fanhouse is a subscription platform where creators can monetize their content, share exclusive behind-the-scenes content and engage with their fans. It allows creators to build a community platform that is in their full control.

Creators receive 90% of their earnings while Fanhouse keeps 10% of the transactions for operational services which is lower than for most other platforms. This creator economy startup has already gained popularity among creators such as The Chainsmokers.

6. Bildr

Bildr offers a visual web development platform that allows creators to build their own apps and browser extensions. With an extendable toolbox and ultimate design freedom, Bildr has a built-in infrastructure that enables creators to easily launch their own app.

7. Karat

Karat is a creator economy startup that was designed for creators and creative-led businesses offering customized financing, rewards and support tailored to Instagram, Youtube and Tiktok creators. Many times banks reject creators when they apply for a business credit card because their business is often not considered legitimate.

Karat has a different approach and takes creators’ engagement rate and follower count on their social channels into account when they apply for a credit card, which gives creators more capital based on the size of their audience.

Their rewards include categories that are not offered by other banks focusing on rewards that creators actually need and can use. They also offer financial planning support to help creators with corporate structuring, planning and taxes.

What Drives the Creator Economy?

Social media has fueled the creator economy. It provides marketplaces where creators can make their living.  Successful creators also use social media to build a following and then share their latest creations with them. 

The average US adult spends 38 minutes per day on Facebook. Indeed, 16-24-year-olds devote a median of 3 hours a day to social media. Internet users, in general, spent an average of 2 hours and 22 minutes per day on social networking in 2019. That is a serious amount of time spent on social media, and this gives many opportunities for creators to promote what they produce to relevant, targeted types of people.

Social media is hugely linked to a small number of platforms: Facebook, YouTube, Twitter, Instagram, TikTok, and a few more. These platforms use algorithms that truly dictate what any individual will see. People who choose to advertise on these platforms have a larger audience than those who try an organic approach.

However, social media requires content. The platforms need people to upload posts, pictures, videos, and the like. Therefore, they make it easy for the best creators to make a living from their content, usually with a revenue-sharing model as described above.

Is Etsy Part of the Creator Economy?

For some, the creator economy is a haven to specialize in something they care about, are an expert at or know others will enjoy. Instead of doing their favorite activities as a hobby, certain people who make their money in the creator economy live their dreams by making money from these same activities.

The creator economy is full of different types of people and personalities. Content creators can become influencers that affect how their large following of people choose to purchase or act. Other content creators create content for entertainment purposes only. 

Anyone that makes content designed for audiences online is part of the creator economy. This would include:

• Bloggers or vloggers
• Entertainers
• Experts
• Celebrities or influencers

Some also include marketplaces that sell creative talents online, such as Etsy or eBay, as part of the creator economy.

Which is a Creator Economy Platform?

More platforms continue to develop and grow to attract more content creators, especially since the creator economy is becoming so popular.

Different platforms exist for different types of creators and their content styles. For instance, live-streaming creators benefit from using Twitch or Mixer as their platforms rather than Tumblr or Pinterest because of their content type and target audience.

Social media platforms are a common place for creators to start, but it depends on the type of content you plan to make. Examples of social media platforms that offer payment for top content creators include:

• Instagram
• Twitter
• LinkedIn
• Snapchat
• YouTube
• TikTok

However, there are some more general platforms available that benefit many types of content creators. Choosing the best option depends on which business model they prefer. A few of the most popular platforms include:

• Patreon
• BuyMeACoffee
• Ko-Fi
• Indiegogo
• Kickstarter
• Podia
• Gumroad 

How do Creators Make Money in the Economy?

In the creator economy, creators make money directly from their audience. It consists of consumers, entrepreneurs that cater to their audience, advertisers, and companies that market to artistic entrepreneurs.

Platforms like TikTok, Teachable, and Patreon connect creators to consumers. Other businesses, such as analytics software and content creation tools, support independent creators. And, of course, consumers looking for unique niche content are willing to pay money to be a part of a community dedicated to their passion.

More than two million professional individual creators make content full-time, and around 46.7 million do it part-time, according to SignalFire. These include innovators wanting to pursue artistic activities, such as musicians, writers, craftspersons, and animators. Many creators rely on third-party platforms to build a following, and Influencer Marketing Hub said social media remains the “primary conduit for creators to distribute and monetize their work.”

Revenue-generating activities in the creator economy include:

• Online courses.
• Livestreaming.
• Newsletters.
• Coaching and consulting.
• Merchandise.
• Affiliate links.
• VIP meetups.
• Ad revenue.
• Subscriptions.
• Book and e-book sales.
• Sponsored content.
• Fan clubs.
• Tipping.
• Non-fungible tokens (NFTs).
• Live and virtual events.
• Podcasting.
• Product placement.
• Crowdfunding.
• Speaking engagements.

Is the Creator Economy Sustainable?

While these challenges are important to note, they don’t necessarily dim the outlook for the creator economy. While the rate the industry has been growing is likely unsustainable, that is because we’ve been witnessing the birth of a major industry. It can’t keep growing so dramatically forever, and eventually, that growth will slow down and align with other industries.

However, that doesn’t mean the industry will decline. The creator economy is an industry built for the future. Social commerce increases every year, and in some countries like China, e-commerce has surpassed in-person retail. The creator economy is essential to e-commerce. As people up the number of purchases they make online every year, the creator economy will continue to grow.

Even if the industry is becoming overcrowded in the influencer area, that doesn’t necessarily hurt brands and companies operating in the creator economy. Companies that use influencers as part of their business model will have more options to choose from than ever before; the only problem will be filtering through all the options to find reliable ones. It isn’t necessarily a bad problem to have.

The creator economy has grown so rapidly that it has at times felt like the Wild West. While that type of growth isn’t sustainable, the ecosystem is still being flushed out. People are only increasing their dependency on social media and the content creators on those platforms. That isn’t likely to change any time shortly. This means that the growth of the creator economy is likely very sustainable.

How do Content Creators Make Money?

Despite creating a video, what are their earnings? How do they earn money out of it? You will learn about the revenue opportunities for content creators below.

Advertisements

Advertising is one of the most effective ways to increase revenue for your video. You’ve probably seen short adverts while viewing a video on YouTube, where you have the choice to ‘skip ad’ in some circumstances but are required to watch it all the way through in others.

The video maker is compensated for including or adding short segments to eligible videos and gets paid for it. Moreover, you shouldn’t get revenue from those ads if it contains sexual content, inappropriate language, violence, or any controversial matters.

Subscription

Even large OTT platforms earn millions of dollars each month or annually from their subscribers, as is the case. Many video creators, similar to Youtubers, ask viewers to subscribe to their channel in the same way. As a result, video creator content generates a large number of subscribers as well as revenue.

Brand Sponsorship

Having your video sponsored would undoubtedly influence a large number of viewers while also increasing the worth or quality of your video material. To do so, you’ll need to create video content that sounds interesting and builds loyalty and reputation among your target audiences. As a result, credible companies will be prepared to pay for your video content to market their products and services.

Affiliate Programs

As you may have noticed, many creators include affiliate codes in their content to sell or promote specific brand products. Video makers can also join affiliate networks and advertise a company’s goods for as little as seven seconds in their videos.

For instance; you’ve probably seen some video creators promote a brand in the middle of their video and request viewers to check out a certain URL or code. In this case, video artists act as a middleman in exchange for traffic on merchant websites as a recommendation and receive a good sum of money.

Fan funding

As a reward for their support, many well-known video creators receive huge sums of money in the form of donations or fan funding. Video content developers, on the other hand, monetize through channel memberships. Fans and followers pay a fee in exchange for additional content.

Licensing

Licensing your ebook, blog post, movie, music track, artwork, or photograph to other companies for a charge is one of the simplest ways to generate revenue. You can make a decent living from your creations if the material is distinctive and adds significant value to the firm.

A publisher can earn $13,000 per month for five books, a blogger $375 for each piece, and a cameraman $26,250 for ten films at the upper end of the range. The typical commission ranges from 30 percent to 70 percent of the wholesale.

Sales-Based Income

PewDiePie, Dude Perfect, and Logan Paul, for example, are among the most well-known content creators who sell their merch. This is for a very important reason. According to new data, YouTuber merch can generate 10 times the amount of gross revenue as advertisements.

You might be asking how to make YouTube or other content merch at this stage. Starting with print on demand is your best bet. This eliminates the need to purchase and store a huge inventory, as well as drive to the post office. Simply upload your designs to a print-on-demand service. They’ll take care of your merch printing and delivery so you can concentrate on developing new products and content.

Consultant

Working as a consultant, coach, or mentor could provide a more secure income than creating courses. Michelle Schroeder, for instance, went from being a freelance writer to advising business owners on content strategy. She has paid off $40,000 in debt and is now able to travel full-time. Freelance consultants often charge between $30 and $250 per hour, making this a great way to augment your income when times are tough.

Courses

The coronavirus outbreak has resulted in a large number of people purchasing online courses and signing up for learning websites. Between March and July 2020, Coursera, for example, attracted 35 million students.

Smaller players might take advantage of emerging social norms by capitalizing on the growing demand for online learning. Your earning potential is determined by the price of your course, the size of your audience, and your conversion rate. The typical course costs $187.59, with a conversion rate of 2% to 5% at the mid-level.

Is the Creator Economy Web3?

The creator economy principles – ownership of work, decentralization, and flexibility – run in parallel with the emergence of Web3. As the world moves closer to the next generation of the internet over the next few years, expect to see increasing overlap between the creator economy and Web3. Here’s what that might look like:

Creator-owned content and platforms 

Creator-owned content is the first iteration of the Web3 creator economy. On current social platforms such as Instagram and TikTok, the company behind the platform owns the content that creators produce.

Web3 will enable creators to not only own their content on existing social platforms but also own a part of the platform they produce and distribute content on. Content can begin to be creator-owned and platform-agnostic through the use of NFTs, which act as proof of ownership and validate the content’s authenticity. 

In the future, creators could own and govern the platforms they engage with based on factors like their following and content quality. This could be made possible through DAOs, and member-owned organizations without centralized leadership or governing power. “Ownership” of the social platform would be represented by tokens distributed to creators according to their relevance and impact on the platform. 

Creator-made metaverse platforms

Creators will also play a key role in the metaverse. In addition to participating in it, creators can develop parts of the metaverse with either no-code tools or technical background. This has already started to take shape in existing gaming metaverses, most notably Roblox.

On Roblox, anyone can create video games and monetize them directly on the platform. In 2020 alone, creators earned $329 million through Roblox alone. “Metaverse creators” will likely grow to become an active and profitable vertical of the creator economy in the years to come. 

While the intersection of the creator economy and Web3 is still nascent and its future is uncertain, if executed well, the Web3 ethos and emerging technologies could have massive implications – not just for creators but the future of work as a whole. 

The best-case scenario: Web3 will enable a world where people can make a living by producing work that they have direct ownership over without the dependency on centralized third-party organizations that exists today. 

Creator Economy Trends

For all the creators out there, here are some trends that might shape the future! 

Way more brand collaboration opportunities

The good news is that brands are increasing their investment in creator marketing. 48% of marketers reported investing over $100,000 annually in spending. Whereas 10% of them spend as much as $1 million! This signals that great brand collaboration opportunities lie ahead for many content creators.

Brands are open to spending millions because creators have a stronger bond with their target audience. They bridge the gap between brands and their customers. Therefore, they can compel them to purchase specific products. This immensely helps brands gain a leg up in social commerce. In addition, creators expand a brand’s awareness and reach, leading to increased conversion rates.

Higher compensation for creators

Creating valuable content and keeping your audience happy can help you earn a fortune in 2023! Companies now recognize how creators can exponentially boost their revenue, and creators are also aware of the value they bring to the table. Therefore, creators demand higher compensation, and brands happily pay for them. However, many creators factored in genuine brand affinity as a prerequisite for paid partnerships with brands. 

As a content creator, your fee will mostly depend on the following factors:

• Your reach and engagement
• The creator economy platforms you are most active on
• The frequency at which you post content online 
• The efforts you will put into a campaign

 Long-term brand relationships

Gone are the days when brand collaborations used to be a one-time thing! In 2023, expect brands to become your best buddy and to have lasting relationships. Brands are now looking for long-term relationships with their creators.

Thank you, lucky stars! Brands will now consider you their creative partner — no doubt, your creator career will receive a significant boost this year.

Data-driven with advanced measurements

Many businesses play a guessing game when it comes to performance analysis. This will change in 2023. More organizations will start using data-driven approaches to minimize the chances of failed campaigns and get the anticipated return on investment. They’ll measure critical metrics of popular marketing channels to ensure you deliver on your promises.

Social media analytics will also advance to offer accurate insights and expose the loopholes in strategies. These advanced measurements will help brands create a robust predictive model that allows efficient scaling in the future.

Stories lead the way

Be it Facebook, Instagram, or TikTok; popular social media channels have added a new feature: Stories. Stories will play a crucial role in the coming months, so make sure you make the most of them. These 24-hour long clips quickly capture attention as they are placed right on top of the apps. Many additional features, including polls and votes, solicit the audience’s opinions to boost engagement. 

These Stories have redefined audience engagement, forcing brands and creators to rethink how they find and engage with the audience. There are even third-party apps you can use to boost the curb appeal of your Stories.

Creators drive creative strategy

Initially, brands viewed creators as rivals, competing with them to get more visibility. Fortunately, 2022 is bringing a change to this perspective. Brands are now open to partnering with creators, so much so that creators play a crucial role in their creative strategy. Their opinions are increasingly accepted in significant decisions related to the brand’s reach and conversions.

Creators can now liberally create content around their partner brand’s products, and brands can convert it to ads on TikTok — all thanks to Spark Ads. This new feature allows brands to convert user and influencer-generated content into ads and promote them on the For You Page, gaining more visibility.

 NFTs and crypto

In 2021, the NFT (non-fungible token) market surpassed $40 billion and is ever-increasing. NFTs have become a new technologically advanced source of revenue for creators. Though the NFT and crypto industries are said to be in their infancy, the demand for blockspace is rapidly growing. Therefore, creators and big brands are progressively leveraging NFTs and boosting their bank balance! 

You can also board the NFT train to gain more profit as a content creator. All you need to do is select the NFT you want to sell — digital art is the most common one, though NFT games are soaring in popularity — and eventually, sell them. In fact, the most expensive NFT digital art was sold for $69,346,250!

Gen-Z driven

The creator economy will be driven by Gen-Zers, who will redefine small-to-medium businesses. It is noteworthy that Gen-Z builds businesses in a highly non-conventional manner. The fundamental difference is that they rely on a decentralized team to get the work done, as they work remotely. On the other hand, the conventional business model demands employees to physically sit together and work for a specific, pre-defined, non-negotiable period.

Additionally, there are differences in terms of team composition and revenue models. While the teams are fluid and often temporal, the revenue model is community-driven.

Creator Economy Stats

1. 50 Million Join the Creator Economy

A SignalFire report found that the creator economy is rising in popularity rapidly. As Forbes describes, “Ask a kid today in the U.S. what they want to be when they grow up. No longer is musician or athlete the top answer. It’s a YouTuber—an answer 3x more popular than astronaut.”

SignalFire believes that 50 million people will soon consider themselves to be creators.

2. 46.7 Million Creators Consider Themselves Amateurs

Although 50 million people consider themselves to be creators online, the vast bulk still believes themselves to be amateurs. Only the dedicated few can yet claim that being a creator is their full-time job. This will undoubtedly change, with creator numbers rising rapidly at the moment.

SignalFire splits creators into amateurs (46.7 million) and professionals (2 million +).  Notably, more than half the amateur creators (30 million) share their creativity on Instagram, followed by 12 million on YouTube, 2.7 million on Twitch, and 2 million on other social platforms. In contrast, you are more likely to find professional creators on YouTube (1 million), then Instagram (500,000), Twitch (300,000), and Other (200,000).

3. 2 Million Global Creators Make Six Figures

One of the reasons for the rapid rise in being a creator is that it can be financially lucrative. Technically, creators come into the category of “small businesses,” and two million such creators already make six-figure incomes. These people act as role models for their younger fans, ensuring that there will be even more creators in the future. 

4. Sponsored Influencers Are Worth $8 Billion Today

Below we describe an influencer as being someone who has: 

• the power to affect the purchasing decisions of others because of his or her authority, knowledge, position, or relationship with his or her audience,
• a following in a distinct niche, with whom he or she actively engages. The size of the following depends on the size of his/her topic of the niche.

Clearly, most (if not all) influencers are creators of some form – whether it be through articles, images, or videos. Sponsored influencers contribute $8 billion today, and according to Mediakix research, are likely to be worth $15 million by 2022.

5. 1 Million + Creators on OnlyFans

Taking a relatively broad definition of creators, then many of them now run channels on OnlyFans. As we wrote in a recent article, “OnlyFans is part of the new creator economy. It provides a ready market for creators to charge for their goods or services.” Support for OnlyFans rose dramatically during the 2020 lockdowns.

In 2019, they reported 60,000 content creators. The previously mentioned Forbes article, written in September 2020, increases this number to 450,000.  However, by December 2020, OnlyFans was reporting more than 1 million creators on their platform.

6. 97.5% of YouTubers Don’t Make Enough to Reach the U.S. Poverty Line

One of the reasons for YouTube’s popularity with creators is that it has a sophisticated ad-sharing model. YouTube takes 55% of ad revenue and distributes 45% back to creators. The problem is that, as good as that sounds, you still need significant people to watch the ads on your channel for you to make money. And, of course, most people opt to skip ads as soon as they can (which results in no income for the channel holder). 

This means that for most creators, it’s nearly impossible to make a sizable income via ads. You need a substantial audience so that even a small percentage of viewers watching your ads makes a noticeable effect, or you need very supportive viewers willing to watch ads as a favor to you.

The end result is that 97.5% of YouTubers don’t make enough to reach the U.S. poverty line, $12,140. Therefore, YouTube creators need to find other ways to supplement their advertising income.

7. Ad Revenue for Creators has Declined by 33% During COVID

While, in theory, you might think that ad revenue for creators should have increased during the COVID lockdowns, that hasn’t happened in practice. Sure, people are watching more videos, and some may be more willing to let ads run, but the problem was that many companies halted their ad campaigns. Of course, with sales in many industries up overall, that was probably a short-sighted decision for many firms.

8. Half of Consumers Use Ad-Blocking Technology

The other issue that creators face has been the popularity of ad blocking technology in recent times. One of the reasons that influencer marketing has become so popular in recent years is that up to half of consumers use ad-blocking technology. This is a double-edged sword for creators.

The ad blockers greatly reduce their chances of making money from any ads they may place on their websites and social pages. On the other hand, however, it increases their marketability as influencers, who can still promote products through their regular posts.

9. 29% of American Kids Want to be a YouTube Star

As we mentioned previously, there has been a noticeable change in the aims and aspirations of Generation Z kids compared to their predecessors. A recent survey found that 29% of American kids wanted to be a YouTube star. This compares with a mere 11% who had dreams of becoming an astronaut.

10. 22 Thousand YouTube Creators Have More Than 1 Million Subscribers

There are approximately 37 million YouTube channels in total, so you do have stiff competition to succeed on that platform. Of course, many of these are set up by amateurs, who spend most of their YouTube time watching other people’s content. Indeed, people, on average, create a YouTube channel and upload 500 hours of video every minute on average. 

This data comes from Socialblade, which only counts channels with at least five subscribers, so there are probably additional channels with very few, if any, subscribers.

As of November 2020, there are around 22,000 YouTube channels having over 1 million subscribers. In 2019 the number of YouTube channels having more than 1 million subscribers grew by 65%. Both T-Series and PewDiePie now exceed 100 million subscribers.

Of course, many creators have successful YouTube accounts with far fewer subscribers. Around 230,000 YouTube channels have over 100,000 subscribers, at which point YouTube considers you worthy of having a partner manager to help your future growth.

How Big is the Creator Economy?

The creator economy is huge—but how huge is it? If you’ve ever wondered just how many content creators were out there and how much they actually earn, you’re in the right place.

• There are over 200 million content creators in the world today.
• It takes content creators an average of six and a half months to earn their first dollar.
• Just 10% of influencers earn $100K or more per year.
• The global influencer market is expected to reach $16.4 billion by the end of 2022
• European brands spent €1.3 billion on creator marketing in 2020 alone.
• 85% of full-time content creators say they enjoy their work.

How Much is the Creator Economy Worth?

In 2021, a Forbes report on the creator economy titled “Why The Creator Economy Is Worth Watching In 2022” estimated that the digital creators market was worth $20 billion, with estimations that it could grow to a $104.2 billion market in 2022. According to a recent report by Policy Circle, the creator economy accounts for between 2% and 7% on average of national GDPs worldwide or a little over 6.1% of the world’s overall GDP. These figures undoubtedly prove that the creator economy is bringing about a new wave of business opportunities, improving people’s lives, and boosting the country’s GDP.
According to Douglas Kendyson, CEO and founder of Selar, an eCommerce platform that helps creators distribute and monetise their content, knowledge and skills, he said “the evolution of the creator economy only became very mainstream amongst Africans in the last couple of years. Some can be traced back to smartphone and internet penetration growth over the years in Africa. This is because the creator economy works mostly on the internet. So, as more internet and smartphone penetration grows, more people can be connected to creators and access their offerings.”
How did creatorship grow so quickly?

The late 2000s saw the advert of platforms like YouTube, Instagram, iTunes, Spotify, and more recently Snapchat, Twitter, Medium, Twitch, and TikTok aid in the discovery of creators and the development of an audience by making significant investments in their recommendation and curation algorithms. 

The creator economy is growing to become one of the biggest employers of labor as there are two million professional individual creators who make content full-time, and around 46.7 million do it part-time, according to SignalFire. From starting off with limited IG and YouTube Creators to now having over a million creators all over the world, ‘Content Creator’ is now a proper job a Gen Z can now justify to their parents.

Having developed fandoms that follow them off-platform, creators can become full-fledged businesses with multiple revenue streams beyond ads. In the digital and ancillary support industry, e-commerce platforms such as Selar are designed to help creators earn money by selling digital products and services such as e-books, online courses, memberships, arts and music items, coaching packages, stock photography, live and virtual events, and speaking engagements.

As a result, creators can focus on creating unique niche content that caters to their audience’s interests rather than desperately seeking the biggest possible audience and making more generic clickbait-y content. 

In other words, creators are becoming more diversified in their revenue streams, shifting from being paid by platforms like YouTube with ad revenue shares in exchange for attracting an audience to the platforms, to being paid by brand sponsors on Instagram and Snapchat in exchange for their reach to an audience they access through the platforms, to being paid by fans via patronage or tipping or eCommerce in exchange for entertainment and community beyond the platforms.

Why Creator Economy is Important

1. It’s accessible.

There are over 6 billion people who use a smartphone device, according to Statista, and almost 4 billion of them are active on a social media platform. These forums are free to use, so virtually anyone can create content and post it for the world to see. Additionally, these platforms make creating content easy with editing softwares, ability to upload and clickable-content technology to connect posts to outside sources and shops.

2. The money is there.

The amount of money content creators bring in is, of course, relative to their following, niche, industry and other factors such as engagement rates and where they are located. With that being said, creating content is something that can be a hobby or even a side hustle, allowing people to bring in extra cash while working their normal day jobs.

Major social media platforms have also released features to help content creators and influencers earn more money and diversify their revenue streams thanks to new integrations, tools and revenue-sharing options.

3. The possibilities are endless.

Once creators are able to reach a substantial following in a specific niche and industry, more opportunities begin to present themselves in the form of brand deals, company collaborations and even the possibility of starting their own businesses. Companies see the advertising potential these content creators hold due to their followers’ desire to support their endeavors.

The more these creators partner with companies, get involved with marketing and become knowledgeable about business while maintaining a large following, the more I can personally see them shifting from working with businesses to creating their own. Many content creators create their own product lines, promoting their own services, brands and social media, resulting in a greater diversification in revenue streams and overall opportunities.

For example, YouTuber Emma Chamberlain is known for her affinity for iced coffee. Due to her association with coffee and ever-growing following, Emma created her own coffee label and has seen arguably the highest success of all creators-turned-entrepreneurs. Other content creators are being hired by companies as directors of influencer marketing or head of the creative marketing department due to their creative mindsets and ability to connect with target audiences.

4. Creators know how to reach the audience that many large businesses are struggling to reach.

Content creators spend a lot of time on social media studying the language, humor and overall culture of the population within each social media app, especially their target audiences. These content creators become experts in reaching the most niche groups, learning new ways to become relatable and, when they gain a following, dictating current and future trends.

More importantly, social media has allowed for the immediate spread of information to millions of people at once. Along with their own followers, content creators can partner with other content creators (TikTok has a duet feature and Instagram recently launched a new feature called Collab), maximizing their reach and broadening their audiences.

Brands can also take advantage of this instantaneous and wide reach by forming deals with these creators to promote their products to the creator’s audience.

Where is Creator Economy Heading?

Today, everyone has a way to monetize their own content. The way that influencers are able to participate in brand campaigns has become vastly different now compared to five years, or even one year ago.

Influencers have a variety of platforms and options in terms of the communities that they build online. Amazon Live, Clubhouse, Spotify’s Greenroom, Twitch– all of these platforms give brands the opportunity to connect with large audiences, in real-time. From sports to gaming to live product demonstrations, the possibilities are endless. 

YouTube and Pinterest are the latest platforms to explore the benefits of monetizing creator content, despite YouTube seeing more monetary success than every other social platform solely off of brand deals via the “Creator Economy”. 

The term Creator Economy is everywhere these days, focused on by brands, marketers, investors, and content creators, but it is really only a subset of the “Attention Economy”. Consumers give more time and attention to social platforms than ever before and of that, more time is given to content creators on platforms like TikTok and YouTube than anything else, even games. 

Brands pay to be where the attention is, content creators garner it and get paid for brand integrations. The ecosystem is accelerating and the way to hold consumers’ attention is changing — and now, so is the tech they use.

Every platform has its own diverse audience and best practices for success– not to mention unique data sets.

Creator Economy for Brands

The pandemic led brands to rely more heavily on influencer marketing due to the increase of creator-driven activities on social media. Examples included live streaming sales, social commerce, podcasts, audio content and short video as a form of entertainment — digital actions used to bring users online and convert them to interacting with brands and creators.

Content created by creators is meant to entertain users and even involve them with spontaneous video and photos, moving away from institutional — and let me say old-fashioned — advertising campaigns. Indeed, this characteristic lets brands have more direct contact with customers and catch their attention, not through VIPs or famous personalities, but people like them.

Here are some of the main advantages for brands interested in social campaigns with creators:

1. Customers are more involved at the outset. Content creators actively and regularly interact with their fan base, increasing users’ engagement with the content and acting as an intermediary between the brand and its customers.

2. Creators can customize the brand’s message. They have the ability to adapt the message of brands’ campaigns for their audience and devise an ad hoc content strategy.

3. There’s often a higher conversion rate. Since creators have already established a relationship of trust with their fan base, they can push users to conversion in a very genuine way.

4. It targets Gen Z and millennials. Younger generations are more likely to buy thanks to creators’ advertising of mid-price products, rather than higher-price products sponsored by influencers because the younger generations have less income.

Creator Economy Companies

The creator economy consists of 200 million creators and over 300 startups. These startups offer tools, platforms, products, and services that help creators launch their careers and turn their side-hustles into businesses.

From managing finances and live stream shopping to selling courses and making music – you name it, there’s a startup for it. So let’s take a look at which startups are influencing the growth of the creator economy, both in numbers and in funding.

These are in no particular order. 

1. Beacons

Beacons is a link-in-bio startup that offers a two-tab site with growth and monetization features. Creators can customize their links and embed virtually anything: social channels, selling links, fan donations, etc. 

2. Pearpop

Pearpop offers Instagram and Tiktok creators a marketplace where they can pay or get paid to collaborate with other creators, brands, or users on content creation. 

3. Pietra

Pietra is a platform where creators can connect with manufacturers, warehouses, and product designers to release their own products. Creators have a wide variety of products to choose from, including clothing, drinks, fragrances, etc.

4. Buy me a Coffee

Buy me a Coffee is a platform that provides creators to accept support, membership, and payments from their loyal fans. Creators can set up monthly or annual memberships. 

5. Fanhouse

With Fanhouse, creators can directly connect with their fans and make money from subscriptions and tipping while growing their community. 

6. Stir

Stir is a platform that lets creators track their finances and pay their collaborators and employees instantly. It’s a financial studio for collaborating, splitting, and managing your money and metrics.

7. Karat

Karat offers separate charge cards tailored to Instagram, YouTube, and Tiktok creators. To see whether the creator qualifies for a card, the platform looks at metrics like engagement rate and follower count. 

8. Kajabi

On Kajabi, creators can build, market, and sell their online courses, coaching classes, and memberships. It provides a dashboard with the creators’ website, social media, communities, etc. all in one place. 

9. Patreon

Patreon is a subscription service where creators can give access to exclusive content and community memberships to their subscribers. Creators can set up a monthly subscription and offer different subscription levels. 

10. OnlyFans

Another subscription service, OnlyFans is especially popular among adult content creators. Creators can monetize by setting up subscriptions on a monthly or annual bases, or by one-off tips and pay-per-view. 

How the Creator Economy is Transforming Hollywood

Amazon is acquiring the legendary MGM studio catalog. Warner and Discovery are merging. AMC Entertainment received a $250 million infusion of cash to update its theaters and buy new properties.

The marketplace is forcing the old guard to play catch-up. We are seeing the adding, removing, restructuring and combining of companies and studios to amass subscribers and cater to a new generation of consumers who are driving the democratization of everything.

The marketplace is forcing the old guard to play catch-up. We are seeing the adding, removing, restructuring and combining of companies and studios to amass subscribers and cater to a new generation of consumers who are driving the democratization of everything.

In the creator economy, artists are equipped as never before to mint, own, market and merchandise everything they create. They are assuming control directly over consumers to meet public demand, with ironclad security in place, and monetizing at every step. Former outsiders are now insiders, with commercial ecosystems building around them.

Within the next few years, the creator economy will grow exponentially based on Generation Z’s coming of age and advances in technology.

Creator Economy in Web3

Today, the definition of the creator has been changing with the rise of Web3 as power dynamics shift from the platforms to the creators and their communities. 

Harry Stebbings, Founder of The Twenty Minute VC and 20VC fund, says, “Seeing more value captured by users, both individually and collectively, is one of the most exciting aspects of Web3. It removes intermediaries from traditional Web2 aggregators and gatekeepers, which is key for the democratization of income creation in the digital world.”

The creator economy is no longer just about providing value to the platforms. It’s about new forms of direct creator-community relationships. Not only does it provide the opportunity for creators to offer more to their fans (including financial upside), but also for both creators and their communities to finally be able to participate in the collective value that they help platforms create.

This is the opportunity we see for the new community-led creator platforms, their ability to create self-sustained networks and fairer ecosystems where people serve each other and the community as a whole.

This will lead to the success of the creator economy.

Jarrod Dicker, Partner at TCG, comments, “What Web3 really does is it unlocks the possibility for creators to offer more. If we take newsletters as an example, the concept in Web3 becomes ‘why subscribe when you can invest?’ In the case of Mirror.xyz, you now have the opportunity to invest at the earliest stages of a publication in exchange for a token or NFTs so you effectively have ownership in that.” 

Creator Economy and NFTs

NFTs are all very well and good when it’s rich teenagers on the internet investing in Nyan cat. But recently, some big-brained marketers have been discussing what this might mean for creators, and the creator economy. Plus what this means for the decentralization of content creation funding. Plus what this means for annoyingly named social media platforms.

The creator economy appears to give creators more agency. Rather than constantly trying to keep up with changing algorithms, or brands, they can rely on income from loyal supporters. This means deciding how, and when, they take on work. And the income goes straight to them.

But before the content economy, came the attention economy, a model where the most valuable commodity was – you guessed it – attention. This meant, according to Michael Goldhaber, the economy shifted from a material-based model to an attention-focused one.

This meant audiences consumed content from big companies like Google, Apple and Facebook. Whatever ad you were seeing was decided by the site you were on.

So along came the creator economy. In this model, individual creators took control of various online platforms, using UGC to engage with their audience. This model has democratized how content is made, shared and consumed, and has decentralized big name platforms. 

The creator economy has enabled individuals to create digital content that utilizes blockchain technology. This could, number one, alter what the financial landscape looks like for these creators, and number two, make it possible to earn a lot of money on a single piece of work alone.

Peter Yang believes that, with NFTs, creators won’t have to deal with intermediaries who can take control of content rights, as well as their visibility and a percentage of earnings. 

So, creators are looking for ways of using NFTs to share paid experiences, in order to engage with their fans. Just like owning a piece of real merch, NFTs put a prime on ownership. This elevates the ‘experience’, instead offering fans the ability to ‘own’ something in addition to consuming content. And people love to own things, especially when other people are unable to. 

Creator Economy Business Model

These are some tried and tested business models that can help you build your own creator platform.

1. Content subscriptions

Content subscription is one of the most popular business models out there. With this, your platform allows content creators to build recurring revenue streams with their fans through subscriptions. Creators can sell written content, podcasts, online courses, and more.

Stripe, in a recent report, found that education (EdTech) was the fastest growing sector in the creator economy. And we can understand why.

Notable startups: Gumroad, Medium, Spotify, Substack, Kajabi, Teachable, Interval.

There could be thousands or millions of people out there —creators and fans— who share the passion you have, albeit a niche. Would you build a platform where those creators and fans could meet, it could well turn into something massive overtime.

2. Community memberships

Social media helped us meet our need for connection (love) and acceptance, self-esteem, identity, and significance; they didn’t create it.

Platforms such as Indie Hackers, Stackoverflow, Makerpad are all communities that bring thousands of people with a shared interest, on a daily/weekly basis. And yet, our need to belong to a community is nowhere near being satisfied.

We are social beings by essence, so there’s still room for more communities to build and join.

Notable startups: Clubhouse, Discord, Slack, Makerpad.

3. Ticket sales

Virtual and in-person gatherings are exploding globally. A proof that the Covid-19 pandemic could not make us forgo our desire to participate in in-person events.

From online conversations to concerts, creators are always looking for opportunities to interact with their fans. With ticket sales, fans can connect with creators and pay them for their time and energy.

Now may be your time to join other companies like Ticketbud, Soapbox Engage, or Eventbee by setting up your own ticketing platform too.

Notable startups: Eventbrite, Ticketmaster, Eventbee.

4. Tips from fans

Do not be mistaken by this seemingly soft approach. “Tips from fans” turns out to be a pretty viable business model for creators to engage with fans and live off what they do best, create content.

Its two most popular forms are the “Buy me a coffee” button and the “Pay what you want” checkout option on Gumroad.

Notable startups: Ko-fi, Buy me a coffee.

5. Financial services

The growing number of Banking-as-a-Service APIs has spearheaded the creator economy at a blistering speed.

Consequently, many platforms today can offer money-management accounts and issue cards with custom rewards to the creators -on their platforms. Also, if you ever think of granting creators free access to your platform, this alone could be a sure and steady way to make money as the platform owner.

Creator Economy Blockchain

With blockchain technology, sports stars, celebrities and creators have found unprecedented, more powerful ways to monetize their work, create stronger bonds with the communities that admire them and become completely autonomous.

Content creation on Web 3 looks very different with creators able to determine how much they charge and under what conditions. This model turns social media into a stable career choice, eliminating the unpredictability that inflames anxiety and discourages participation. Creators have greater equity than in existing payment models, and fans may treat paywalls with scorn.

But most fans and creators have yet to understand how Web 3 enables easier access to content and creates more sustainable business models than other approaches. Now, developers have a golden opportunity to address this gap quickly and permanently shift power from giant corporations.

Creator Economy Blogs

Blogs were one of the earliest forms of expression on the internet and still persist. While the blogosphere might have changed a little, bloggers are still around and most popular in fashion, beauty, food & drink, travel, and other specific niches.

Now, most successful bloggers monetize their audience with sponsored content, affiliate deals, and online courses. It’s also very common for a creator to start as a blogger only to expand into other platforms, like YouTube or Podcasts.

Huda started a beauty blog back in 2010, which landed her clients for her makeup artist work. The blog eventually helped her launch a cosmetics line and has since expanded to skincare and more cosmetic goodies.

She has since expanded and has 50 million followers on Instagram while maintaining a presence on TikTok, YouTube, Facebook, and Snapchat.

Creator Economy Course

A 2-week-long intimate workshop-style course with the person who coined the term “Passion Economy”. This course will help you understand the underlying trends and creator psychology so you can seize the opportunity presented by it.

Course Syllabus

1. The Creator Landscape

An explosion of tools have emerged to serve creators, empowering them to not only advertise other brands, but to become their own businesses. In this module, you’ll dive into the history and current state of the creator ecosystem, explore the major segments of creators, and understand creators’ psychology.

2. Creators as Businesses

Become a creator is an emerging career path in the digital age. What frameworks guide how creators think about monetization?  In this module, you’ll learn to answer these questions and analyze creator-focused companies through three frameworks: effort/earnings ratio, passive/active income, and long tail vs large creators.

3. Traction and Distribution

Understanding other companies’ playbooks behind their launch strategy and tactics for gaining traction can jumpstart your own explorations. In this module, you’ll analyze how breakout creator-focused companies overcame the cold start problem. You’ll be able describe the creator growth loop, analyze successful referral programs, and more.

4. Measuring Success

To build any great business, you need to learn from data. Because the creator economy is nascent and “creators” are a new type of business, the metrics behind success aren’t clear. In this module, you’ll dissect the major “aha” moments for breakout creator businesses and identify the leading and lagging indicators of success for your own project.

5. The Investor’s Perspective

To build an attractive business that scales, founders need to understand how investors think and evaluate business opportunities. After completing this module, you’ll be able to answer: What does success look like across various business models? What leading indicators do they look for at early-stage? How do they analyze competitive startups?

Creator Economy Investors

In 2021 the creator economy went to extreme highs with an estimated $3.7 billion invested in creator-oriented startups in the US. This can be attributed to the rapid growth of the creator economy and the influx of new and innovative startups. 

However, in the first quarter of 2022, funding had dropped by 30% within the creator economy. These numbers have raised eyebrows and caused panic amongst creators.

From this point of view, it is no surprise that people glance at the creator economy with suspicion. However, the number of investors prepared to pour their resources into the creator economy is further proof of its potential. Below are some of the investors.

• SignalFire
• Intonation Ventures
• Floodgate
• The Chernin Group
• Andreessen Horowitz
• Next 10 Ventures
• Index Ventures
• Inspired Capital
• Ludlow Ventures
• MaC Venture Capital
• BBG Ventures
• Slow Ventures
• Box Group
• Seven Seven Six
• UTA Ventures
• CRV
• Starting Line
• Acrew Capital
• Atelier Ventures
• Chapter One Ventures
• Night Ventures
• Worklife
• Kombo Ventures

Creator Economy vs Gig Economy

The term “gig economy” was coined by the former New Yorker editor Tina Brown in 2009 describing side hustles, or work with no fixed contracts. Mastercard expects that the global gig economy will be worth almost 350 billion US dollars this year, with the help of Uber and Airbnb driving the growth. A case study predicts that the global gig economy will be at $455 billion USD by next year in 2023, at a Compound Annual Growth Rate of 17.4%.

With social media as a tool, the Creator Economy was born as a subset of the Passion Economy. These are people who are creating content and making money from something they feel passionate about (ie: Youtubers and Tiktok ers). There are more than 50 million people globally who consider themselves as creators.

The proliferation of new platforms over the past decade was a result of the demand for tools to help creators to monetize whatever they are creating, including audiences. We’ve got Substack for articles, Clubhouse for podcasts, and now Festi for activities, which is kinda like Etsy for doing things instead of selling things. These activities include pop-up meals, deals and workouts (online and in-person).

While making extra money is great, having people admire what you create is greater. Chef Leonard Holton, creates pop-up meals from his restaurant when the kitchen is slow. He says “providing dinners people enjoy brings value to my life.” Chefs are artists at heart who derive the most joy from sharing their culinary creations.

Tiphanie’s passion is dance fitness and she charges $5 to join her on Zoom at 7 am. With the ability to share their passion, the community not only gets an opportunity to support individuals and local small businesses but we get more food and exercise options to live a healthier life.

The key difference between the Creator Economy and the Gig Economy is in the creator economy, a creator creates content for a specific audience. Within that relationship between the creator and the audience, the creator learns what products they could offer directly to their audience.

How Much Does the Creative Industry Contribute to the Economy?

The creative economy, in some ways, defies definition almost by definition. But its significant 3% contribution to global gross domestic product (GDP) makes it a powerful emerging economic sector that is being strengthened by a surge in digitalization and services.

Read Also: What are Cross Border Payments?

Its contribution is likely to grow, say those monitoring the creative economy, if certain key trends can be addressed.

“The creative economy and its industries are strategic sectors that if nurtured can boost competitiveness, productivity, sustainable growth, employment and exports potential,” UNCTAD’s international trade and commodities director, Pamela Coke-Hamilton, said.

But creativity is not a panacea for economic diversification. The many challenges the cultural and creative industries (CCIs) face are a microcosm of the swath of global challenges today.

The climate crisis, limits to growth, intellectual property (IP) and copyright, digitalization and e-commerce platforms, the future of work, terms of trade, and access to distribution networks all require careful examination.

Creator Economy Global Market Size

The global creator economy is estimated to be worth over $20 billion, of which Africa should ordinarily be a major contributor and beneficiary considering its large youth population, the need for multiple income streams due to job insecurity, unemployment, and the option of having a foreign earning channel. However, African content creators are limited by fraud, payments, and funding challenges.

The creator economy could be mistaken for the gig economy. While they differ in some ways, they overlap at some point, as they involve using one’s creative abilities to earn an income or gain influence. However, the latter resonates more with earning an income based on short-term contract jobs — often referred to as freelancing.

The creator economy is apparently a huge one, with over 50 million professional creators and influencers attracting and engaging audiences by the second. And it is even more interesting how easily they can influence and inform the lifestyles of their audiences and communities, something that was once strictly in the purview of specific professionals who employed certain channels. For instance, several skills you could only learn in a classroom can now be mastered on YouTube.

The creator economy is not a new concept, but it only started gaining popularity in the last decade. This industry has been estimated to be worth over $20 billion. However, the African market is barely enjoying the boom.