The definitive guide to Patreon

(This was originally published as a section within today’s Monetizing Media newsletter. Sign up here.)

Patreon: the definitive report
I wrote a 20,000+ word analysis of Patreon and monetization strategies by independent content creators. Patreon is a platform that creators use to run membership businesses (monthly payment in exchange for special access) with their superfans. Think CRM + CMS + payment processing.

The report dives into the company’s founding storyproduct developmentbusiness model & financialscore thesiscompetition, and potential exit scenarios. I also added a syllabus for further reading.

Some quick takeaways:

  • Patreon has undergone a strategy shift from being a marketplace / social platform to a SaaS company making business tools for creators. The goal seems to be to provide all tools & services a creator needs, including small business loans.
  • Patreon’s rake is too low, but they’re about to roll out new premium features. I suggest pricing tiers as a path forward, which is the norm for B2B SaaS.
  • The product needs to put creators’ brands first and Patreon’s second.
  • 70% of revenue comes from creators who make $1k+ per month. That’ll be $35M+ this year.
  • The key question is how big this market size is. The % of creators who make even $1k per month is tiny…but is that 10s of thousands or 100s of thousands of them?
  • Last valued at $450M in 2017, I expect Patreon to close a Series D in the next few months that makes it a “unicorn”.
  • An IPO in a few years is possible, but I think it will get acquired first. Facebook and YouTube are obvious candidates. I make the argument that Endeavor should buy them though.