From Gizmodo:
Over the past four years Patreon has grown to become the de facto funding model for independent creators online—a platform where supporters pledge small monthly recurring donations that better support an enduring career instead of the need Kickstarter or GoFundMe’s per-project setup fills. But an overhaul of its fee structure announced yesterday has creators furious and patrons leaving in droves.
. . . .
Patreon—which supports YouTuber channels like Binging With Babish($11,000/month), animators like David Firth of Salad Fingers fame ($10,000/creation), and podcasts like Chapo Trap House ($87,000/month)—has long relied on a simple financial arrangement that allowed creators to receive a lump sum at the beginning of each month. Of course, that paycheck might vary somewhat because creators were obligated to eat payment processor fees in addition to the 5 percent take the platform shaved off the top.
The new structure—and why everyone is so angry—passes those processor fees on to patrons instead.
“Starting on December 18th, a new service fee of 2.9% + $0.35 will be paid by patrons for each individual pledge,” the company’s announcement post reads. “Streamlining these fees for creators and patrons ensures that creators take home as much of their earnings as possible.”
Sure, that math checks out—until you factor in a mass exodus of pledge-makers.
Link to the rest at Gizmodo and thanks to Maggie for the tip.
I started on Patreon almost a year ago. Nothing spectacular, but the support has paid for hosting my website and podcast since then. It also financed the formatting and cover for my last book and will do the same for the next one. So it’s been more than worth it.
I informed my Patrons that I don’t agree with the new fee system and will find a way to compensate them. In the meantime, I’m looking for alternatives. I got the email from Gumroad too but am holding off until they actually roll out their plans.
Of all the ways Patreon could have handled this, it looks like they chose the worst one…
I am looking into Steady. 10% commission + payment processing fees. My guess is I would net about 85% of the donation.
The Steady boys are based in Berlin. Their website is in English (good English, too; the Germans teach English better than the English and Americans), but they have a couple of examples in German, so it helps if you read German.
Thanks! I had seen them on one of the lists of alternatives that are in circulation but haven’t gotten to them. I will, even though my German is rusty. 🙂
For my video content, I just started with Pivotshare. You can use it as a membership site (which is how I in part use Patreon + YouTube). They take 30% per sale/rent/monthly membership fee and you keep the rest. They do charge a one time fee for encoding uploads into different resolutions, which they don’t make clear until after you sign up. But it’s doable.
Patreon is bound to find out they aren’t the only game in town, as I’m sure I’m not the only creator taking these steps…
They lost me after they yanked Lauren Southern’s account and a portion of livelihood over partisan politics.
There current (previous?) fee structures looks to blow chunks. It is awful considerate of them to have picked the lower base fee for roll out than the two higher ones they were experimenting with. I think they could do a better job showing this wasn’t intended to make them money. But when you go from charging one side of the transaction to both sides, it is pretty hard to see it as anything more than a money grab.
Money grab? I suppose we could say that both creators and Patreon are trying to make money. I wish them both the best of luck.
Way to shoot yourself in the foot, Patreon.
I support a couple of people via very small amounts and I’m going to re-evaluate and probably drop one or two.
Like all these kinds of decisions, all you have to do is follow the money …
From the rest of the article …’Patreon has raised four rounds of venture capital funding in as many years, totally over $100 million, and it used a portion of that money to acquire competitor Subbable, a platform created by YouTube early adopter Hank Green. Among those on the company’s board is former Twitter CEO Dick Costolo…’
… and this … “[t]his was never (and still isn’t) about making more money for Patreon as a company.”
https://twitter.com/cwbuecheler/status/938787629738397696
This string of tweets lays out the money trail very clearly.
Great reading. 🙂 … ‘specially when the CEO of Patreon stepped in. 🙂
Such fees are best cloaked under “administrative costs.”
sounds like time for a new startup to replace patreon
they are working off the offshore model [incluyding us and canada] it sounds like, where abrubtly ‘freelancer, former elance, now upwork’ and other sellthrough/pay through companies, began charging a percentage to the employer starting a couple years back. The larger the job, the bigger the hit to the employer. But also, the employees also pay a fee from each paycheck.
People left in droves, both workers and employers. There are many new start ups in the field offering far better.
Patreon was ‘the one’ but entire website/blogs are leaving
I was going to shift my short stories & stuff over to Patreon but now I’m not so sure. I got a email from Gumroad. They are trying to pick up the loss from Patreon. I have not tried Gumroad yet but they appear to be like an etsy store of sorts so we’ll see. Have to check them out more.