Bridging the Gap in the Creator Economy
Building the future of work for creators centers on solving the problems they care the most about - Distribution, Ownership, and Ownership.
The creator economy continues to expand and accelerate with more and more tools hitting the market with the intent to build the future of work for the creative class. However, as the diversification of tools increases, there appears to be a gap in companies that are addressing the entire scope of what creators care about.
In the thousands of conversations, I've had with creators and their teams over the years, there are a few areas every creator, regardless of their medium, is focused on: distribution, monetization, and ownership are at the forefront, and unlocking these areas is where the opportunity exists. If companies want to truly build the future of work, then they must solve the magnitude of issues creators are experiencing in these areas primarily.
What Creators Want
Creators want tools that help them create better and run their businesses effectively. Clear ways to make money and transparency around how they can access those funds; they also want to better understand ways to foster deeper connections with fans through experiences and care deeply about ownership – not only as it relates to their intellectual property (IP), but also the ownership of the relationship to their audience.
I define distribution as the method in which the item being produced (content, music, videos, etc.) reaches the audience it needs to. With the advent of independent distributors, social media platforms, DSPs, and other stand-alone methods to upload and produce content, there has never been an easier time to create and share that creation. In 2022, Spotify uploaded 60,000 new tracks per day: that’s the equivalent of 22 million songs in one year, or a new song every 1.4 seconds. For context – in 2019, the company uploaded 40,000 tracks.
The rate at which songs are uploaded shows the ease of access for distribution, but it also opens the discussion around the barriers to entry for independent artists when we start to dig into the numbers on stream rates, label share, and budget. When we examine the total cost of producing a song ($1,000+), inclusive of all elements of the song (studio time, marketing, mixing/mastering, and content) and divide by the revenue generated from streaming, then the cost to acquire a new listener for an emerging artist is on the highest end, and they are often competing against the unlimited budgets, established relationships, and widespread influence of major labels.
If distribution is at the top of the list of concerns for creators, then monetization, and ways to make money from their art once they’ve reached their audience, are of equal importance. Only the top 1% of creators are making sizeable returns from their platform of choice – whether it’s YouTube or Spotify, when we start to examine the pay structures, emerging creators are often at the bottom of the pay spectrum, relegated to a smaller percentage of the share of revenue being generated. It is harder for them to generate sizable revenue from touring, streaming, and syncing when they lack influence, access, and money. Web3’s promise to level the playing field through various projects has yet to come to fruition, and so, creators are left holding the bag, hoping to build their audience through platforms, generate enough income to produce their shows, develop marketing budgets to maximize ways to earn new fans, maintain life, and not run out of steam.
This is the reality for many creators: choosing between the pursuit of their dream and a full-time role that takes them away from that pursuit. Caught in an endless flywheel, most creators opt to leverage the one thing they have: ownership of their intellectual property (content, music, videos, etc.) understanding too late what leveraging these items too soon does for their long-term impact.
As tools and companies have come along to solve a lot of the issues in music – first through ease of access to distribution methods, then through expanded access to monetization strategies – it gave way to a much larger issue that snuck up while creators were distracted: ownership. Through music, we’ve heard a lot of horror stories about artists unknowingly signing away the rights to own their work, or leveraging entirely too much through an advance, and later regretting it. At some point, a creator, regardless of their medium, will have to decide whether they want to give up ownership to their IP to reach new heights, and they’ll have to grapple with that decision.
For Issa Rae, the decision to enter into a long-term agreement with Warner where they owned the content she produced in partnership with them, was a no-brainer. She receives capital, access, and relationships – while also the fulfillment of creating the things she loves. It is a win-win for her as someone who started her career on YouTube, built an authentic connection with her audience through partnerships with Patreon, and continues to foster through her own channels. Issa understood early what many creators are starting to wake up to owning the content is important, but owning the audience is THE most important.
When a creator owns their audience, they can shift platforms, launch new verticals, explore new mediums, and know their relationship will continue to expand. When they don’t own their audience, it opens them up to the whims of larger companies and shifts the balance of power.
What I’ve seen time and time again in building growth strategies for both creators and creative-focused companies is that the entity that owns the relationship with the audience is the one that holds the power. Right now, platforms like Spotify, YouTube, and Web3-centered marketplaces own that relationship – they allow others (brands, creators, you) to access & leverage the relationship from time to time, but there’s a cost for that. Almost all these platforms are predicated on the continued use of consumers, creators, their teams, and stakeholders from studios and labels. Creators don’t own their audience, they are just renting it, and like real estate in most cities – the cost for that skyline view is becoming exceedingly out of reach.
What this means for the future
At any given moment, a creator is only accessing 15% of their audience thanks to platform algorithms – and even if they can access it, there is no guarantee that action will be taken. Now imagine a world where the creators can access 100% of their audience, drive engagement, control access to it, and tailor experiences based on what they know of their audience. I wholly believe this is where we are headed and the reality of this future is being built one algorithmic playlist, AI-enabled DJ, royalty pay-out to collectors, at a time, and it’s largely being shaped by teams who do not wholly reflect the diversity of the creators they serve.
I believe in a future for creators that provides them with the frameworks they need to be successful and leverage the content they are building while owning the relationship with their audience. A world where the content creator becomes their own studio; the independent artist becomes their own label, and the aspiring sneaker designer or health enthusiast becomes their own distributor. I believe that when creators are adequately equipped with the right tools, partners, and access – there are zero limits to what they can do.
This belief is one of the reasons I founded Visionary Rising as a creative studio and growth partner in 2016. It is also one of the reasons I’ve been so excited about the acceleration of blockchain technology over the last few years, but my excitement about the progress made in the space doesn’t blind me to the fact that there is still a lot of work to do to ensure that the promise of WEB3 tools for creators lives up to the reality of the platforms being created.