Somewhere in the world today, a person will upload a video to YouTube that will earn more money in the next 24 hours than you have in the last 2 years combined.
The absurdity of these figures attest to the staggering amount of opportunity waiting to be captured online. But the ones who will win biggest in this new economy won't necessarily be those with the most creative output or the largest audiences.
Instead, it will be those who have taken the time to deeply understand what the Creator Economy actually is and how it works. For those looking to seize this new opportunity, here are 10 well-researched articles that, once read, will put you miles ahead of most creatives.
The Passion Economy and the Future of Work
This piece is written by Li Jin – a name should become very familiar with if you’re interested in creator economics. In addition to being one of the leading voices in the space, Jin is also the founder of Atelier Ventures, an investment fund focusing on supporting alternative forms of work.
This article presents a simple foundation for how the passion/creator economy works. In the past, companies succeeded by "flattening" their workers into machine-like cogs that could be arranged and activated as needed. Looking forward, human uniqueness will be a competitive advantage for the companies that understand how to wield it (i.e., feature vs. bug).
There will be an increase in service-based businesses that thrive on ongoing revenue models. Passion economy adherents win through differentiation and narrow loyalty, not commodity and mass advertising.
Newer roles will emerge to support this creative shift. While the opportunities to become a full-time YouTuber or Podcaster may be at the beginning stages of being understood by the mainstream, we are still years away from people understanding that their supporting roles also have an auspicious future. Video thumbnail designers, podcast transcribers, digital content managers; all of these hint at a burgeoning industry of creator-support roles.
However, the most interesting questions point at how else this new economy might change our world.
What is a Creator Town?
One of the most exciting ideas is that our geography will one day reflect our new work priorities.
Cities were built near waterways to accommodate ships. They expanded inward towards land as factories became the primary drivers of employment. Suburbs sprung up as cars redefined transportation in the 19thand 20th centuries.
Today, we live in a world defined by where we work and how we get there. But what happens when work can be done from anywhere? Transportation is no longer a necessity but a choice. If more people work where they live, suddenly where they want to live changes. Accessibility, diversity, beauty, community – luxuries once relegated to other places and other times become realistic, current demands.
Nat Eliason understands this trend as both a remote entrepreneur and creative. “We no longer need major cities for knowledge work,” he writes. That is why he is documenting his project called Creator Towns, “an initiative to grow small towns by leveraging the digital economy.” The goal is to experiment with what the future of communities might look like as they evolve in response to the changing landscape of work.
The Rise of the Creator Economy
While the terms passion economy and creator economy are used almost interchangeably in most cases, there is a significant difference. The creator economy is primarily concerned with "creators earning income from making and distributing online content."
Granted, the digital shift in our work is more significant (exponentially) than merely those who produce media for the internet. The passion economy encompasses both creatives and those who are able to compete on a global scale by serving smaller audiences with any product or service imaginable. The Passion Economy by Adam Davidson does an excellent job of illuminating the sheer scale of what's possible thanks to simplified distribution channels, cheaper production options, and, of course, the internet.
Yet, the creator side of this trend is significantly more visual, which means that even those who may not directly make their income as a creator will likely have to interact with their industry in order to support their own (i.e., influencer marketing, supportive roles, etc.).
Julia Maltby, writer and Investment Associate at Flybridge VC, argues that the future of creators will be "platform-agnostic." Makers will find ways to interact with their audiences, and monetize their attention, in multiple ways using a stack of integrated tools. Likewise, audience loyalty will increasingly move towards personas and away from platforms.
As an investor, programmer, or likewise – the way to make money, then, is to build and fund items that support this trend, rather than trying to fight it. The tools that enable creators to connect with their audiences, streamline/repurpose their content, and creatively monetize their work will win.
Audience and Wealth Part 1 and Part 2
As we move further into the creator economy, the discussion becomes more focused upon incentives. Why do people consume the media they do? Why do creators create? Who benefits and why? And how can we reshape these incentives to build the kind of internet and society we want to take part in?
Mario Gabriele, founder of The Generalist, wrote a 2-part series on these incentives and the relationship between creator audiences and shared wealth.
As the amount of content continues to rise, a shift occurs. Suddenly, new content, which was at one point the most valuable entity on the expanding web, devolves into a commodity. One can find great content almost anywhere. Great articles, videos, podcasts, artworks, etc. They're all just thrown out there for us to find and consume (which increases the importance of curation and distribution).
But rather than get overwhelmed by this problem of excess content, we can take a step back and understand what factors are at play. Gabriele highlights that there are 4 distinct currencies in the creator economy: “effort, attention, money, [and] ownership.”
Creators, consumers, advertisers, and everyone else in between pays one or more of these in order to take part in this new system. The question, then, is how we can rearrange these incentives so that fewer platforms become trillion-dollar behemoths and more creators (and consumers) build living wages from their work online?
Decentralization, partnerships, and incentivized engagement are all ideas on the table. The point is, the system we have now must evolve in order to sustain the billions more coming online in the near future.
The Creator Economy Needs a Middle Class
Building upon the above argument, this article from Li Jin examines the problem of top-concentrated wealth in the current creator economy. The biggest platforms and creators (<1%) account for 90%+ of all the wealth accumulated.
Her suggested remedies include more randomness integrated into algorithmic suggestions, clearer financial incentives for collaborations, experimental funding models to support early creator careers, and Universal Creative Incomes (UCI) for those who contribute to the success of platforms.
An inequitable creator landscape will inevitably fold in on itself. The only way to truly reshape the economy at large is to show that creative alternatives are legitimate routes to a financially rewarding career for those who commit. No one would say that becoming a lawyer is a scam, even though the time and money it takes to become one is often extraordinary – because the rewards (as far as most industries go) are fairly certain.
How can we encourage that a substantial input (years of dedication + financial investment (to build a YouTube channel or to attend law school)) will lead to a satisfactory output?
Creator Hierarchy of Needs
With so much discussion centering on the creator economy at large, its useful when experts turn their attention back to the creators themselves.
Peter Yang, a product management expert, has written a piece deconstructing the recommended order of priorities for aspiring creators. The diagram distills 3 large periods (publish, grow, monetize) into 9 sizable but defined steps from finding a niche to buildings a personal monopoly within a singular category.
When creators attempt to monetize too quickly, before building a sizable audience or defining their unique value offering, they often fail. This leads them to quit too early in the process to see the success that is possible. Consistency over the long-term is a proven pathway to success in the creator economy.
However, that consistency must not fall into complacency. The top earners on any platform have worked on iterating and improving their content day in and day out. This strategy allows them to master their craft and their value offering in such a way that monetization becomes a clear side effect of what they produce, rather than an intimidating prospect sitting just out of reach.
1,000 True Fans? Try 100
In a similar vein as the piece above, Li Jin critiques Kevin Kelly’s original article in light of what is possible in the new social media landscape.
Whereas 1,000 fans may need to purchase multiple items from a creator in order to support their livelihood, the knowledge economy offers a different route to financial sustainability. Small and medium creators (often with audiences of less than 10,000) can charge a premium for their domain-specific knowledge ($1,000 – $5,000). This drastically lowers the number of purchasers needed in order to sustain an independent creator: less than 100.
More importantly, creators should familiarize themselves with how and what their audiences would like to support. A large free audience may only ever offer support through ad revenue. A smaller portion may purchase merchandise or donate through platforms like Patreon. The smallest portion will pay for premium access (private community), results (cohort courses), and recognition (super chats).
This blending of income sources leads us into one of the most powerful creator economy philosophies.
Why a Paid Newsletter Won’t Be Enough Money for Most Writers (And That’s Fine): The Multi-SKU Creator
Hunter Walk, a partner at Homebrew VC, has identified one of the most destructive beliefs within the creator landscape: their primary income should come from a single creative source.
This misbelief is due to the salary framework we’ve grown up in. People get jobs and are paid a single salary. A person could get a second job in order to add an additional salary, but the framework remains. One job = one salary.
In the creator economy, the one-to-one equation falls apart. A single creation can make money in numerous ways, across multiple platforms, for an undefined period of time. Also, creators themselves are free to earn income in ways outside of their primary creations. None of this is against the rules; it's part of the new landscape.
A writer may make 25% of their annual income through a newsletter. Another 25% may come from selling online courses. An additional 10% can come from affiliate sales of recommended products. And whatever else is needed could come from consulting gigs, sponsored posts, or an entirely unrelated project altogether.
The multi-sku mentality frees creators from the trap of thinking that their primary creation must equal their primary income. The income pie now has many more slices, and because of that, it can grow significantly larger.
SignalFire’s Creator Economy Market Map
As we draw this curated list to a close, the final two articles offer a way to prioritize creator content going forward.
SignalFire’s extensive research discovered that nearly 50 million creators are making some form of income online with their content. 2 million of those are able to do so full time.
These are monumental numbers that reveal the true scale of opportunity available online. What's even more interesting is where these creators find themselves creating content. Video content makes up nearly 70% of the full-time creator landscape. A much smaller portion (<20%) is audio and text-only content.
For creators who want to make this their career, what they create must have a visual element (ideally video). An even better strategy would be to repurpose their content in as many forms, and as many platforms, as possible. Just as we mentioned platform-agnosticism above, creators must treat their individual content machines as the product and not fall into the trap of over-dedicating to any one platform.
Content Over-Supply and the Future of the Media Business
Finally, we close this list with a firehose of information from Storius Magazine. It's clear that the content landscape has evolved into a fiercely competitive space. More videos, podcasts, and articles are being uploaded every second than any person could reasonably consume in their lifetime.
And yet, the opportunity is far from over. In the grand scale of the creator economy, we are still at the most infantile stages of development. Creators have discovered, often the hard way, that content treadmills are unsustainable paths to growth. Rather, the next phase will be for smaller-scale creatives to model what the media-industry behemoths are doing: focusing on distribution and capitalizing on legacy audiences.
First, the game is no longer to create the most content but to get it in front of the most people possible. Advertising is one means of accomplishing this. Another is strategic distribution. Netflix has already carved a space in 70 million households so that when they release a new piece of content, they simply need to make it visible in their app – no outside marketing needed. In a similar way, creators should ask themselves what people are already looking at and then focus on making their creations available there. Those who make their content easiest to consume will win.
Second, in an age of overwhelm, people gravitate towards the familiar. We've seen this with the success of decades-old franchises. Marvel and Star Wars may have been long past their prime, yet they've grown into billion-dollar opportunities because of the consumer desire for familiarity. Creators should capitalize on these desires and look for ways to create around familiarity.
Lastly, if content has become a commodity, then its best use is to attract and drive customers “to other industries that have better profitability economics.” Which brings us back to our multi-sku discussion. Content is a tool. It’s the leverage with which every aspiring creator can form a career online, so long as they understand the role it plays in their larger income pie.
If you found this list helpful or have additional creator economy articles to recommend, please reach out on Twitter @RamosAuthor.