6 min read
Opinions expressed by Entrepreneur contributors are their own.
We are currently witnessing the rise of the “creator economy.” This is an economy of 50 million content creators of all sorts — artists, gamers, journalists, producers, influencers, editors and others — who, thanks to the advances of modern technology, are able to transform their passions into careers.
A phase of rapid technological growth
With new apps and monetization opportunities that focus on the creator, rather than the platform, the industry and valuation of this market will undoubtedly grow throughout the decade — from 2016 to 2017 alone, America’s creative economy grew by 16.6 percent, earning a total of $6.7 billion. Fully 86 percent of Americans aged 13 to 38 are willing to try influencing, according to a Morning Consult poll from 2019, with the top reasons familiar to any entrepreneur: flexible hours, having fun and sharing ideas with the world. (Fame is the least-cited reason.)
As an entrepreneur in the creative industry for 20 years, I’m encouraged and excited by this new generation of creative entrepreneurs paving their own paths forward. Because that’s exactly who they are: entrepreneurs. They invest their own time and money learning a skill and understanding an industry; they keep up to date on industry trends; and they market themselves to a specific target audience with precision, dedication and knowledge.
Related: 4 Tips to Turn Social Media Content Creation Into a Full-Time Career
Creatives, not platforms, are in control
Creatives are suddenly in control of their own careers in a way that felt impossible during the early years of the internet. To cite the most famous example, in 2007, a kid named Justin Bieber was busking on the streets of his hometown in Stratford, Canada (population 31,000) when a marketing executive discovered him on YouTube. In the subsequent decade, millions of musicians have zealously uploaded their work — the fruits of their creative labor — completely for free, hoping to be the next Justin Bieber. YouTube held all the power.
Today that’s changed, and the circumstances that led Bieber to fame are nearly impossible to replicate. YouTube, long since bought by Google, is no longer a one-year-old platform whose few core users are eager creatives and home-video enthusiasts; it’s now a corporate pay-to-play plaza with expensive, high-quality music videos generally receiving the most views. YouTube is valuable, but it isn’t where creatives are flocking.
If Bieber were still busking on Stratford’s sidewalks today, he wouldn’t just upload his content to YouTube. He might create a Patreon account, asking subscribers to support him monthly and sending exclusive songs directly to patrons in return. He’d probably sell an album he recorded in his bedroom on Bandcamp. He would upload tracks to Spotify or Apple and receive small royalties for every stream. Most likely, he’d place a link to his Venmo account everywhere he could, so fans could send him tips directly. He could even set up a TikTok account or start invite-only Clubhouse rooms.
All these platforms were created specifically to emphasize the creator. Facebook, Twitter, Snapchat and Instagram are increasingly resembling relics of the 2010s while platforms that directly support creative work — OnlyFans, Substack, Cameo, Clubhouse and others — are rising to the top.
It’s telling that Twitter and Facebook are currently developing and launching their own competitors to the above-mentioned brands. Twitter launched Spaces, a Clubhouse competitor, in May 2021; Facebook is paying gamers to play on Facebook Gaming instead of Twitch. Both are investing in newsletter rivals to Substack. Obviously these multibillion-dollar behemoths are entering the market with an unfair advantage, but their reputations are also tarnished by data and privacy scandals in a way that single-purpose platforms like Substack are not. As users and creators are empowered to migrate to different platforms with ease, the old titans may start to crumble.
This change is good — and overdue. For over a decade, creatives have been exploited by social-media giants who monetized their users by encouraging them to tweet, post, upload and stream as much content as possible. The platforms monetized billions of eager eyeballs and barely paid their content creators anything. (YouTube pays fractions of cents per view on certain accounts, but even a video that gets a million views might only net the creator a couple thousand dollars.) Today, that creator would rightly tell his or her thousands of subscribers to support him or her directly elsewhere. Direct monthly payments from OnlyFans, Patreon and Substack create a steady income that’s invaluable for young creative entrepreneurs.
Related: Why Is Social Network App Clubhouse Breaking the Internet?
An economic shift toward valuing creative work
I find these trends optimistic. They represent an economic shift toward accurately valuing creative work. Talented and influential creators — filmmakers, writers, musicians, artists, gamers and others — are finding new ways to monetize their passions. If you can find people willing to pay you for your passion, you’re tapping into an underserved market of people with disposable income whose entertainment needs aren’t being met elsewhere. You’re filling a niche and providing a wanted service. That’s the gold standard for entrepreneurial success.
These creative entrepreneurs are not just content creators: They’re valuable assets in the tug-of-war between the old giants and the niche upstarts. Smart money says the upstarts will continue growing. As has been pointed out, YouTube’s paid subscription model launched the same month as Patreon, in May 2013. YouTube failed to quash the startup competitor, and Patreon recently tripled its valuation to $4 billion. New platforms, including my own new company, are popping up every month to support creators directly by offering tools that help creators focus on creating.
Entrepreneurs outside the creative industry, who are either actively courting influencers or considering dedicating a marketing budget for them, should understand how these new platforms change the messaging game. A creator’s greatest asset is the trust earned between him or her and his or her fans. Creators control the message. They understand the language, tone and approach that will connect with their audience. Similar to how advertising agencies have fallen behind brands working directly with small studios or influencers, expensive intermediaries are becoming a thing of the past. For leaders hoping to penetrate these new markets, the best strategy is to support creatives who share your values and understand your brand, rather than asking them to read a script.
Related: How Content Creators Can Turn Their Creativity Into a Career
The trend is clear: Marketing and economic success are shifting toward the creator economy. We are entering an era where creative work and niche audiences are suddenly being valued more than ever before. For brands looking to connect, or for entrepreneurs designing tools to help these creators succeed, the opportunities have never been more abundant.