1000 True Fans? Try 100(a16z.com)
a16z.com
1000 True Fans? Try 100
https://a16z.com/2020/02/06/100-true-fans/
223 comments
Good points. Based on my experience with whales in f2p games you will get outsized income from 0.1% of whale users, reliable income from 20% of hobby users, and one-off spend here and there from the rest.
When I think of someone paying me $1000 for art that others may pay only $20 or $5 for, first of all it still feels like charity from the whales. I think you could meaningfully create $20 and $5 tiers for any digital art. But what do you sell to raise the value two magnitudes other than status? Selling status to whales relies on a huge "commons" population for them to feel superior to. Nobody whales in a vacuum.
Second issue is whale rarity. Just to find your first $1000 whale you already need 1000 fans. The rest of them are only paying you $20 x 200 = $4,000 and $5 x 799 = $3,995 per year. That's $10k/yr.
The idea that you could only cultivate a stable of whales with artistic output is ridiculous. You somehow need to make the whales believe that the general population is their commons and then sell them status over gen pop, which is probably why the article hones in on wellness as the only vehicle in town.
When I think of someone paying me $1000 for art that others may pay only $20 or $5 for, first of all it still feels like charity from the whales. I think you could meaningfully create $20 and $5 tiers for any digital art. But what do you sell to raise the value two magnitudes other than status? Selling status to whales relies on a huge "commons" population for them to feel superior to. Nobody whales in a vacuum.
Second issue is whale rarity. Just to find your first $1000 whale you already need 1000 fans. The rest of them are only paying you $20 x 200 = $4,000 and $5 x 799 = $3,995 per year. That's $10k/yr.
The idea that you could only cultivate a stable of whales with artistic output is ridiculous. You somehow need to make the whales believe that the general population is their commons and then sell them status over gen pop, which is probably why the article hones in on wellness as the only vehicle in town.
You described the business model of Ludwig van Beethoven. One of the first independent artist in his profession. He had a few whales which gained status through personal inscription of his works and paid him to stay in Vienna. But he was massively popular in Vienna before he gained whales.
I quite like and agree with the numbers here - you could be getting 10k / year before your first whale, so it does not make much economic sense to only focus on a 100 biggest fans.
The phrasing and contextualising in the article is all over the place. It's referred to as a 'shift', but also shows how the basic business models for 100 x $1000 and 1000 x $100 are completely different. They are examining a new different type of business using similar platforms, not a general trend of existing relationships changing in character.
Those trainers selling courses aren’t selling their $1000 courses to the same dedicated group of 100 course crazy training junkies every month, year in year out. Maybe someone will sign up for a series, or for special 1-1 sessions for a while, but then they will have got what they wanted and leave. That’s got very little in common with my long term relationship with a handful of people on Patreon for a few dollars each a month. There might be a very few, very wealthy patrons that do support a guru for large amounts every month, but that's yet another business model again and also has little similarity with the actual relationship people like me have with the people we support. Wealthy people supporting gurus has been a thing ever since there have been wealthy people.
Those trainers selling courses aren’t selling their $1000 courses to the same dedicated group of 100 course crazy training junkies every month, year in year out. Maybe someone will sign up for a series, or for special 1-1 sessions for a while, but then they will have got what they wanted and leave. That’s got very little in common with my long term relationship with a handful of people on Patreon for a few dollars each a month. There might be a very few, very wealthy patrons that do support a guru for large amounts every month, but that's yet another business model again and also has little similarity with the actual relationship people like me have with the people we support. Wealthy people supporting gurus has been a thing ever since there have been wealthy people.
I get so many ads for courses on how to run ads for courses
You should try my new course about how to avoid ads for new courses.
Before you buy this person's course, you should definitely buy my course on how to determine if a course is a good value.
Please don't turn HN into reddit
I second this. Please take my course on avoiding sarcasm and irony for healthier HN discourse if you can't conduct yourself properly.
I sell a course about making a 100 k living from selling courses about how to avoid adds for courses. You get a free golden bullshit card with it.
Where do you place your ads for that course?
From the article it sounds like part of it is going after the same sort of business as Ramit Sethi [1] [2] He seems to mainly sell courses on how to create and sell courses. I don't know how comfortable I would feel doing that. Maybe that's just me.
[1] https://www.iwillteachyoutoberich.com/about/about-ramit/
[2] https://en.wikipedia.org/wiki/Ramit_Sethi
[1] https://www.iwillteachyoutoberich.com/about/about-ramit/
[2] https://en.wikipedia.org/wiki/Ramit_Sethi
Although I agree with all you are saying and your general sentiment, I just want to understand why you state that Physiotherapy is scammy?
I don't think that he meant physiotherapy is scammy, just the concept of teaching it through online courses.
If you take it a few steps further, e.g. online abdominal surgery courses, the point becomes more clear.
If you take it a few steps further, e.g. online abdominal surgery courses, the point becomes more clear.
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Interesting point with the pyramid, a podcaster (Sam Harris) recently turned his free podcast into a "freemium" model where you get half of each episode for free. I imagine this is going to completely kill his following, as it did for me.
Freemium is actually being charitable, it's more like shareware.
Freemium is actually being charitable, it's more like shareware.
It's going to kill his following among people who want to follow him for free, but by definition they don't bring him any money. If you have enough paying users, meaning your business gained momentum, you don't really care about free users anymore.
Some of the free users might pay. Small percentage “conversion” into paying users. But this can be done only once a large following was built and that model seems a bit disingenuous to me, free to paid, and I like the model where the content creator gives some extra to paying users.
But how do you get new users? Podcasts are already very niche...
Sam also does a number of live appearances, and I suspect that a number of free listeners would buy tickets once in a while to see him. It would be interesting to know if this move would decrease the popularity of live appearances as well.
Podcasts are spread by word of mouth. I will no longer be recommending it to anyone, and I imagine this is not unique to me. This kills the following it the long run.
Consider also the guest’s perspective. They want to teach a wide audience.
Consider also the guest’s perspective. They want to teach a wide audience.
I just listened to Darknet Diaries for the 1st time. Awesome podcast, especially the Xbox Underground series.
I noticed they mentioned an extra special interview at the end for paid subscribers. Seemed like a fair thing to do to me.
I noticed they mentioned an extra special interview at the end for paid subscribers. Seemed like a fair thing to do to me.
>completely kill his following, //
You think people who currently pay will stop paying?
Like, it's some sort of virtue signalling?
If he's changed to that model presumably he doesn't care about his following but instead wants to make a living (or make himself rich, depending how things are for him).
You think people who currently pay will stop paying?
Like, it's some sort of virtue signalling?
If he's changed to that model presumably he doesn't care about his following but instead wants to make a living (or make himself rich, depending how things are for him).
In fairness, he does continue to support a charity model as well. He clarifies very often that if you can't support the podcast due to financial reasons, you can simply email his team and get free access, no questions asked.
It's basically (wel... literally) previews for paid content. Has nothing to do with "freemium" indeed.
> may be preying on people's vulnerabilities (private coding classes for kids?)
Having trouble understanding how "private coding classes for kids" is preying on people's vulnerabilities...?
Having trouble understanding how "private coding classes for kids" is preying on people's vulnerabilities...?
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What is "Goop"?
An organization that sells snake oil.
https://en.wikipedia.org/wiki/Snake_oil
https://en.wikipedia.org/wiki/Goop_(company)
https://en.wikipedia.org/wiki/Snake_oil
https://en.wikipedia.org/wiki/Goop_(company)
Overpriced pseudoscientific junk products sold to gullible people and hyped by a minor celebrity obsessed with her vagina.
> obsessed with her vagina
Who has a basic misunderstanding on what exactly a vagina is.
https://arstechnica.com/science/2020/01/goops-netflix-series...
Who has a basic misunderstanding on what exactly a vagina is.
https://arstechnica.com/science/2020/01/goops-netflix-series...
This is what decades of de-prioritizing education funding looks like.
I think this is more what years of teaching people the wrong things entirely looks like. There was an opinion piece in the New York Times of all places that equated criticism of that show with misogyny because 'women in particular have been mocked, reviled, and murdered for maintaining knowledge and practices that frightened, confused and confounded “the authorities.”' https://www.nytimes.com/2020/02/03/opinion/goop-gwyneth-palt... Like, this is an argument that they expect the most educated and informed members of American society to buy, and given what we've been teaching people maybe they're right.
Ouch. The only thing that surprised me about this is that someone of Betty Dodson's stature agreed to be on Paltrow's show. This is kind of like Bob Woodward appearing as a commentator on Fox News.
Gwynneth Paltrow's personal online store. People get annoyed because she's into alternative health stuff but it's really just a store for people who have the same taste as Gwynneth Paltrow.
IIRC the 1k true fans idea was walked back by its original author after they got feedback from industry folks describing how the model was basically impossible to implement in the real world.
This holds 100% true to my experience in influencer marketing and esports. Monetizing fans is really hard on passion alone. You need to create valuable calls to action and continuously produce content in order to maintain their attention. Once you 'lose' a fan (which only means losing their emotional focus, even temporarily) you often can't monetize them at all without significant re-activation effort. [0]Demonstrating this, large influencers lose extraordinary sums of money if they stop producing content for short windows of time.
This is why using influencers in marketing requires genuine strategy, and is the likely culprit behind so much 'hate' for influencer marketing.
[0] https://www.dexerto.com/entertainment/ninja-reveals-shocking...
This holds 100% true to my experience in influencer marketing and esports. Monetizing fans is really hard on passion alone. You need to create valuable calls to action and continuously produce content in order to maintain their attention. Once you 'lose' a fan (which only means losing their emotional focus, even temporarily) you often can't monetize them at all without significant re-activation effort. [0]Demonstrating this, large influencers lose extraordinary sums of money if they stop producing content for short windows of time.
This is why using influencers in marketing requires genuine strategy, and is the likely culprit behind so much 'hate' for influencer marketing.
[0] https://www.dexerto.com/entertainment/ninja-reveals-shocking...
I don't think Ninja is a particularly good example because (1) he is operating at a scale where the normal rules don't apply (2) his rise was equally fast and volatile (3) twitch requires a constant presence more than other content platforms.
Furthermore I read your take, and maybe I'm wrong, as a 1k "fans" and not 1k "true fans"
The "true fans" model is a subset within the larger audience demographic -- they don't care if you stop producing for a while, need their short attention spans pandered too, or the like, this is what makes them "true" fans.
maybe your advice changed their life, or they really resonate with you for some personal reasons -- and again this would only be a sub-set of a creator's total fan base.
At least this is my interpretation of the concept.
Furthermore I read your take, and maybe I'm wrong, as a 1k "fans" and not 1k "true fans"
The "true fans" model is a subset within the larger audience demographic -- they don't care if you stop producing for a while, need their short attention spans pandered too, or the like, this is what makes them "true" fans.
maybe your advice changed their life, or they really resonate with you for some personal reasons -- and again this would only be a sub-set of a creator's total fan base.
At least this is my interpretation of the concept.
True fans or true Scotsmen? ;-)
Ninja is the most visible example, but the same pattern holds true at virtually any audience size (within the range of what is typically monetizable). This pattern is actually more extreme on platforms like Patreon because the audience is expecting something for their money. They are closer to a customer than a typical viewer.
The distinction between a 'true' fan and just a 'fan' is a vague one. If a creator has a total audience size of 1 million, you can bet that less than 1% of them are giving the creator any amount of money, even 1 dollar. Does that 1% count as their true fans? The folks with thousands of paying subscribers, or tens of thousands, have audience sizes to match.
Given that less than 1% pay anything, what percent of those do you think pay at least 20x the normal amount ($5 -> 100$)? Many creators make this somewhat visible by highlighting their contributors and the air is quite thin.
To make a long story short, I disagree with the concept because it paints a very rosy picture of the situation and doesn't match reality much, if at all. If you had 1,000 'true' fans you'd probably end up with $2,000 a month after taxes/platform fees/expenses. And of course, that assumes that you're able to consistently monetize through a subscription platform. If you had to sell individual products to get there it would be even worse.
The distinction between a 'true' fan and just a 'fan' is a vague one. If a creator has a total audience size of 1 million, you can bet that less than 1% of them are giving the creator any amount of money, even 1 dollar. Does that 1% count as their true fans? The folks with thousands of paying subscribers, or tens of thousands, have audience sizes to match.
Given that less than 1% pay anything, what percent of those do you think pay at least 20x the normal amount ($5 -> 100$)? Many creators make this somewhat visible by highlighting their contributors and the air is quite thin.
To make a long story short, I disagree with the concept because it paints a very rosy picture of the situation and doesn't match reality much, if at all. If you had 1,000 'true' fans you'd probably end up with $2,000 a month after taxes/platform fees/expenses. And of course, that assumes that you're able to consistently monetize through a subscription platform. If you had to sell individual products to get there it would be even worse.
Right, but while ninja might have lost $140,000 by going two days without streaming, almost none of the youtube channels I support on patreon are producing a video daily. Much easier to take two days off if you're only producing one or two videos a week!
On that front, I totally agree. Some platforms are far easier to manage an acceptable work-life balance than others. Unfortunately, a month off due to illness would still result in a massive loss of income which could take a long time to rebuild. The financial situations many creators put themselves in scare me, to be honest.
Isn't this largely what Patreon is, though? And there's a lot of people who are doing surprisingly well off of Patreon despite low subscriber counts.
I'd think the trick is to find the right niche- if you're too generic, you're up against the big personalities.
I'd think the trick is to find the right niche- if you're too generic, you're up against the big personalities.
Patreon is quite a bit of work and requires constant upkeep to maintain a steady income flow. It's really no different from Twitch subscriptions in that regard. It does a better job of monetizing primarily because of the easily customized tiers, and secondarily because the platform specifically caters to paid content rather than free.
That said, many of patreon's most financially successful users are producing content that isn't suitable for platforms like Twitch and Youtube.
That said, many of patreon's most financially successful users are producing content that isn't suitable for platforms like Twitch and Youtube.
I commented in detail on this a few months ago ...
What Proziam wrote is a little off, at least as far as music goes.
Hundreds of musicians/music vloggers are working full-time from Patreon/Adsense once they exceed 100,000 Youtube subscribers and upload weekly/biweekly and have 100+ Patrons.
Patreon produces a reliable income stream (for rent, etc.) while Adsense fluctuates but adds up ($1,000 - $5,000/million views typically.)
What I have heard with Twitch is that you need to be online continuously or the audience moves on.
> IIRC the 1k true fans idea was walked back by its original author
That was from a time decades ago when customer acquisition was expensive. With Youtube/Adsense it's not that hard, and one could experiment with Facebook targeting.
And any time somebody uses the phrase "walked back", I've found the author didn't have a nuanced understanding of the subject.
What Proziam wrote is a little off, at least as far as music goes.
Hundreds of musicians/music vloggers are working full-time from Patreon/Adsense once they exceed 100,000 Youtube subscribers and upload weekly/biweekly and have 100+ Patrons.
Patreon produces a reliable income stream (for rent, etc.) while Adsense fluctuates but adds up ($1,000 - $5,000/million views typically.)
What I have heard with Twitch is that you need to be online continuously or the audience moves on.
> IIRC the 1k true fans idea was walked back by its original author
That was from a time decades ago when customer acquisition was expensive. With Youtube/Adsense it's not that hard, and one could experiment with Facebook targeting.
And any time somebody uses the phrase "walked back", I've found the author didn't have a nuanced understanding of the subject.
100 Patrons, even if they contribute well above average, say $25 (after platform fees/expenses/taxes), is still only $2,500 per month. There are some places in the US where that wouldn't be liveable, let alone offer enough stability for a person to enjoy a stable lifestyle. Of course, if you live in a low cost of living area you can make things fly that otherwise wouldn't. But even with that consideration in mind, how many places could you live a 'normal' life on 30k?
I've worked with musicians as well, including some with global recognition and (many) millions of views and song plays. From what I've seen, turning 100k Youtube subscribers into 100k income per year is far from the norm. Plenty of creators in that size bracket quit, suggesting it's not particularly sustainable.
That said, if you can, I'd love to get some more insight into the creators you feel are getting the most out of their effort, and how they're achieving their results!
I've worked with musicians as well, including some with global recognition and (many) millions of views and song plays. From what I've seen, turning 100k Youtube subscribers into 100k income per year is far from the norm. Plenty of creators in that size bracket quit, suggesting it's not particularly sustainable.
That said, if you can, I'd love to get some more insight into the creators you feel are getting the most out of their effort, and how they're achieving their results!
I'll go into some more detail so people can picture how it works in 2020 better.
100k subscribers is the gateway to really making it on YT.
Above that you start going self-viral, so some artists have snowballed very fast (in months) from 100k to 300k+. It's like they're on YT, but their channel is "their own private island" and takes on a life of its own.
1) US artists will need to live at home (or in a van) or be very frugal to make it with the numbers I provided - but it's doable, and they will get a lot of free gear.
And they'll be full-time musicians, which is living the dream for most.
However, low-COL artists can (and do) earn the average local salary, plus free gear. So they have it all figured out.
2) US (and European) musicians will have a hard time touring as the bandleader on that income, since it's pay-to-play now for non-headliners in the US, typically $500 per show, and often T-shirt sales are restricted (see Sarah Longfield's interviews for the details.)
So that means keep uploading on Patreon/YT, or have your sponsors/fans in each city put you up.
3) "Be your own label.", "Own your publishing.", etc.
The important thing to realize is that there is no label deal available for new musicians (the exception would be super-strong writers) in 2020, and even if you signed one, advances have to be repaid. And oh ya, "360 deals" go after your Patreon and YT/Adsense, publishing and show revenue now - just say no.
So go whole hog on Patreon/YT/Adsense (ie. be your own label) because it's not like there is another funding option for most people, aside from a few guys making it as contract performers (ie. paying their dues) for regional touring bands.
See Rhett Shull's YT channel to learn more about that - he's a road dog contract hired gun guitarist with a knack for YT vlogging. Hats off, man, and congrats on the 100+k subs!
Also see Yvette Young's (from San Jose) meteoric rise - she just got an Ibanez signature guitar in her 20's!
100k subscribers is the gateway to really making it on YT.
Above that you start going self-viral, so some artists have snowballed very fast (in months) from 100k to 300k+. It's like they're on YT, but their channel is "their own private island" and takes on a life of its own.
1) US artists will need to live at home (or in a van) or be very frugal to make it with the numbers I provided - but it's doable, and they will get a lot of free gear.
And they'll be full-time musicians, which is living the dream for most.
However, low-COL artists can (and do) earn the average local salary, plus free gear. So they have it all figured out.
2) US (and European) musicians will have a hard time touring as the bandleader on that income, since it's pay-to-play now for non-headliners in the US, typically $500 per show, and often T-shirt sales are restricted (see Sarah Longfield's interviews for the details.)
So that means keep uploading on Patreon/YT, or have your sponsors/fans in each city put you up.
3) "Be your own label.", "Own your publishing.", etc.
The important thing to realize is that there is no label deal available for new musicians (the exception would be super-strong writers) in 2020, and even if you signed one, advances have to be repaid. And oh ya, "360 deals" go after your Patreon and YT/Adsense, publishing and show revenue now - just say no.
So go whole hog on Patreon/YT/Adsense (ie. be your own label) because it's not like there is another funding option for most people, aside from a few guys making it as contract performers (ie. paying their dues) for regional touring bands.
See Rhett Shull's YT channel to learn more about that - he's a road dog contract hired gun guitarist with a knack for YT vlogging. Hats off, man, and congrats on the 100+k subs!
Also see Yvette Young's (from San Jose) meteoric rise - she just got an Ibanez signature guitar in her 20's!
Twitch counts it as a subscription if you use the free "subscription" from Amazon Prime. The thing is that it has to be manually applied every month. So if he's off for a couple days, very few people will resubscribe if they're not on his channel -- because he's off. It's not like 40k cancelled a subscription at once, their gift ran out and most re-upped as soon as he was back on a couple days later.
Yep, I subscribe to a couple of podcast patreons.. for $5 a month for 5-10 hours of good content it's a no-brainer... Patreon.com/redscare It's basically just 2 women mouthing off, it's funny though. They do well out of it.
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It really is a buyer’s market in the attention economy. Viewers are fickle and it’s easy to jump ship if your preferred personality goes in a different direction.
Same goes for TV and video games. There’s just so much stuff being made constantly. It’s trivial for viewers/players to switch to something else.
Same goes for TV and video games. There’s just so much stuff being made constantly. It’s trivial for viewers/players to switch to something else.
Yeah, plus you have to contend with power laws. Most sales or attention is concentrated in the top ~10 and then drops off rapidly with a long skinny tail. You see this with the top selling books, apps, movies, games and things like Twitter followers as well.
Twitch viewership[1] is a realtime example showing this kind of distribution. The top handful always dominate.
1. https://www.twitch.tv/directory
Twitch viewership[1] is a realtime example showing this kind of distribution. The top handful always dominate.
1. https://www.twitch.tv/directory
Twitch is an extremely imbalanced platform in regard to discoverability. Their model is to 'make the big bigger' and monetize a narrow field of creators well, rather than monetize a larger pool of creators. There are a number of valid criticisms of the platform, but this one is the most painful for new creators to contend with by a wide margin.
It also sucks for advertisers looking to work directly with those creators because it narrows the field of creators large enough to work with. Plus it inflates their viewership with users that may be less suitable for targeting.
It also sucks for advertisers looking to work directly with those creators because it narrows the field of creators large enough to work with. Plus it inflates their viewership with users that may be less suitable for targeting.
It’s a specialist’s market. Want to sell an FPS? Good luck getting noticed. Want to make games that only cater to chess players who are also into LISP programming? With a bit of work you can totally carve a niche for yourself.
You need to create valuable calls to action and
continuously produce content in order to maintain
their attention.
Building a community helps retain people as well. This is easier said than done, since this aspect alone does require some effort and constant monitoring. Simplest examples of this would be subscriber-only Discord servers and/or webforums.
There are moral considerations to each of those strategies, of course. Canceling a recurring subscription shouldn't involve jumping through hoops. And "ostracizing/shunning lapsed members" is more or less a How To Run A Cult For Dummies tactic, so ask yourself if your subscribers-only community is operating like that.
> Monetizing fans is really hard on passion alone.
> ... you often can't monetize them at all without significant re-activation effort
I find talk of monetising people extremely off-putting. Also (not meant as a personal attack), I do not want to be around or associate with people who talk like this.
> ... you often can't monetize them at all without significant re-activation effort
I find talk of monetising people extremely off-putting. Also (not meant as a personal attack), I do not want to be around or associate with people who talk like this.
What would you prefer it to be called? We can change the words around to suit our social sensibilities but at the end of the day, we're still talking about convincing people to spend some money. Nobody bats an eye if you ask for more money from your boss, but many people are under a lot of pressure not to try to be compensated fairly for consumer-facing work.
Making good content consistently is hard work, I personally have no moral qualms about a creator trying to make a living doing it.
Making good content consistently is hard work, I personally have no moral qualms about a creator trying to make a living doing it.
I think my main issue is the shift in focus away from a transaction (people paying for a product or service) to reducing people to simply being sources of money.
Also, the idea that fans or admirers should be converted into people who pay you money. My concept of a service like Patreon is that it's a way for people to give you money if they (independently) want to, rather than being pushed or cajoled to do so.
Also, the idea that fans or admirers should be converted into people who pay you money. My concept of a service like Patreon is that it's a way for people to give you money if they (independently) want to, rather than being pushed or cajoled to do so.
The walkbalk was discussed on HN this week, which is almost certainly why this a18z blog post was written.
I'm having trouble envisioning very many markets where a "fan" is going to consistently spend $1k/year.
The article mentions professional training and education, which makes sense.
I can also see certain people spending that kind of money on physical goods (mechanical keyboards, audiophile equipment, one-of-a-kind art pieces) but $1k of revenue from physical goods is very different from $1k of income.
Other than that, the only things I can think of would be direct access to a celebrity or some form of conspicuous consumption. ("That game you play all day? I personally cover 40% of its operating costs.")
I don't see how the average webcomic artist or food blogger can achieve anything like what is described here.
The article mentions professional training and education, which makes sense.
I can also see certain people spending that kind of money on physical goods (mechanical keyboards, audiophile equipment, one-of-a-kind art pieces) but $1k of revenue from physical goods is very different from $1k of income.
Other than that, the only things I can think of would be direct access to a celebrity or some form of conspicuous consumption. ("That game you play all day? I personally cover 40% of its operating costs.")
I don't see how the average webcomic artist or food blogger can achieve anything like what is described here.
My first thought was how ridiculously out of touch with the economic reality of the 99% this author was. Even if you love an artist and are willing to spend some amount of money to support them, that amount is not going to be anywhere near 1k. This author is deeply ensconced in her elite Bay Area bubble. It is embarrassing, tbh.
My thoughts exactly. I doubt she has fans paying her, it’s just her VC theory that isn’t realistic.
The incredibly annoying thing about this is that there's a really obvious case - software tools. There should be so many cases of people who have written a useful tool and have 100 businesses who pay $1000/year because that tool is the backbone of their $1000 * xxx profit.
The fact this doesn't happen very often is a significant failure of the tech industry.
The fact this doesn't happen very often is a significant failure of the tech industry.
This seems to me like it does happen fairly often. It’s the entire model of JetBrains, RedGate, Sublime, Atlassian, etc.
Adobe is a big one. The Creative Cloud suite is over $600 annually.
Yep, and JetBrains has a pricing structure to roughly represent that. Individual license for intellij is $150. Organization license is $500.
I think there are plenty of cases. Just sell your software instead of giving it away.
> The fact this doesn't happen very often is a significant failure of the tech industry.
It's happens considerably more than you could imagine, but most of these businesses don't market the way Twilio does. Many create niche tools you're probably just not running across (Palisades Monte Carlo Simulation for Excel, Minitab stats workbench, the legion of paid Magento/WordPress/Platform X companion tools).
Not unlike how a vast majority of professional programmers don't work for FAANG, but we pretty much only hear about FAANG.
It's happens considerably more than you could imagine, but most of these businesses don't market the way Twilio does. Many create niche tools you're probably just not running across (Palisades Monte Carlo Simulation for Excel, Minitab stats workbench, the legion of paid Magento/WordPress/Platform X companion tools).
Not unlike how a vast majority of professional programmers don't work for FAANG, but we pretty much only hear about FAANG.
I agree that this can be very attainable as a B2B developer. The main challenges are both knowing and understanding the problem and solution and then attracting the audience. It's doable and is being done. We hear more about the unicorns. But there is still a lot of room for the little guys.
Cults are where people live off "fans".
Replacing customers with people emotionally engaged to support you is an exploitative process, involving the takeover of people's mindshare, in a way that can be compared to indoctrination.
People rationalizing the means of this indoctrination is deeply disturbing.
Replacing customers with people emotionally engaged to support you is an exploitative process, involving the takeover of people's mindshare, in a way that can be compared to indoctrination.
People rationalizing the means of this indoctrination is deeply disturbing.
Just because you can draw a parallel between the two doesn’t necessarily make it exploitative. Most of the time I’m sure both sides win, the creator gets to follow their passion, the viewer gets to feel they had a part in it by paying some money. There is certainly a potential for exploitation and indoctrination, but that’s really only in extreme cases.
I don't mind people looking to get paid for what they do. There are plenty of models that let you pay artists more easily, I'm fine with those.
What I am talking about is the rationalization of making "fans", increasing engagement and the promotion of "whale" systems. Those lead to the problem I discussed.
What I am talking about is the rationalization of making "fans", increasing engagement and the promotion of "whale" systems. Those lead to the problem I discussed.
You probably also don't mind consuming other people's work for free and for your own advantage. You're arguing from a very emotional and moral point of view. In the end, if the creator doesn't adapt to its audience (monetizing in a way that works) he will probably don't produce the content you value anymore. Nobody wins. People making up sales tactics for "artists" are just realistic. The reason content producers are drawn to manipulation is today's audience that is not able to decide between "valuable" and "worthwhile" content anymore. Everyone expects information to be free and then damns creators if they try to make a living off helping other people to succeed.
At the end of the day, you need to get by. If you want to live off the things you love you will most likely have to adapt to your audience and do sales like everyone else. Might not be an idealist's dream, but it's how humans work. Doing digital stuff doesn't make fans or customers change how they value things. Besides, giving away almost anything for free upfront raises the bar for people to pay anything at all. It's how we work.
At the end of the day, you need to get by. If you want to live off the things you love you will most likely have to adapt to your audience and do sales like everyone else. Might not be an idealist's dream, but it's how humans work. Doing digital stuff doesn't make fans or customers change how they value things. Besides, giving away almost anything for free upfront raises the bar for people to pay anything at all. It's how we work.
Well when I was young I spent about $1k/year on little thingamajigs called cd's. That was perhaps "stupid" in a pure economic sense but I did it. And if I were young these days I can't say I wouldn't give that amount to some random "content creator" who could give me the same joy as we 80's kids got from sitting quiet and listening actively to music albums from beginning to end.
But me now is like "why the hell would I give that kind of money to some rando on the internet that stream games?". My patreon career is limited at giving a podcast creator $10/month and that was hard to justify for myself.
But me now is like "why the hell would I give that kind of money to some rando on the internet that stream games?". My patreon career is limited at giving a podcast creator $10/month and that was hard to justify for myself.
Spending 1k per years on cd's was sponsoring what, 50 different creators @20 each? Not the same thing.
It needs to be direct engagement at that price point. No one is going to pay Rachel Ray 1000/year for blog access. Someone may pay her 1000/year for access to Skype cooking lessons. High end prostitutes are a nontech example of where they should focus on a small number of Whales. Also people who get paid to do keynote speaches at 20-50k a pop could have long term engagements with 100 fans paying 2k/year.
A fan can be a lot of things.
You can sell software development services, and your fan may be a graphic designer who uses you every time to build out the back-end for the beautiful designs they make. You do a good job, you're their go-to person, they are your "fan".
You can sell software development services, and your fan may be a graphic designer who uses you every time to build out the back-end for the beautiful designs they make. You do a good job, you're their go-to person, they are your "fan".
This is a "think piece" and not based on any research or data. In reality, I'm seeing lots of relatively small entertainers do the 1000 Fans Thing on Twitch and it really works because each subscriber pays 5 USD per month.
Who in the hell is going to pay another individual $1000 a year to make content? That's more than a year's subscriptions to Disney+, Amazon Prime, and Netflix!
One of the root ideas in the True Fans essay was a fan would be willing to spend a day's wage for a year's worth of content from a creator. A large portion of the population at large can pay a day's wage for say 52 hours (a creator spitting out and hour of content a week) of entertainment. Out of that population, argues the essay, a creator needs to only find a thousand True Fans out of the population that can afford the $100 in order to make a living.
That's not only workable math but something that's doable. The market can support the model, it won't always and in every situation but it can. At the reasonable "day's wage" level many people can afford to support multiple creators. Spending $200 a year for content is still in the affordability range of a large portion of the populace.
A far far smaller portion of the population at large can afford $1k for 52 hours of entertainment. It's definitely not a tenth of the $100 population, it's more likely a fraction of a percent. So any given creator isn't likely to find 100 True Rich Fans, they're going to find maybe one if they're lucky. The market isn't going to support a model where a few dozen hours of entertainment costs a thousand dollars. A thousand dollars will get you a game console, a TV, subscriptions to a bunch of streaming services, and a ton of games. Even fewer of these whales could support multiple creators so very few creators could ever possibly survive of the whale model.
One of the root ideas in the True Fans essay was a fan would be willing to spend a day's wage for a year's worth of content from a creator. A large portion of the population at large can pay a day's wage for say 52 hours (a creator spitting out and hour of content a week) of entertainment. Out of that population, argues the essay, a creator needs to only find a thousand True Fans out of the population that can afford the $100 in order to make a living.
That's not only workable math but something that's doable. The market can support the model, it won't always and in every situation but it can. At the reasonable "day's wage" level many people can afford to support multiple creators. Spending $200 a year for content is still in the affordability range of a large portion of the populace.
A far far smaller portion of the population at large can afford $1k for 52 hours of entertainment. It's definitely not a tenth of the $100 population, it's more likely a fraction of a percent. So any given creator isn't likely to find 100 True Rich Fans, they're going to find maybe one if they're lucky. The market isn't going to support a model where a few dozen hours of entertainment costs a thousand dollars. A thousand dollars will get you a game console, a TV, subscriptions to a bunch of streaming services, and a ton of games. Even fewer of these whales could support multiple creators so very few creators could ever possibly survive of the whale model.
> Who in the hell is going to pay another individual $1000 a year to make content? That's more than a year's subscriptions to Disney+, Amazon Prime, and Netflix!
The same people who pay thousands of dollars for self-help seminars and MLM schemes. You're missing why people are buying a product. All of the video streaming services out there combined won't help people get better at love or their career. That's why they're not willing to drop $1k on streaming services.
But a charismatic YouTuber who shows you how to bodybuild and gets you motivated? People will drop $1k on that per year.
The same people who pay thousands of dollars for self-help seminars and MLM schemes. You're missing why people are buying a product. All of the video streaming services out there combined won't help people get better at love or their career. That's why they're not willing to drop $1k on streaming services.
But a charismatic YouTuber who shows you how to bodybuild and gets you motivated? People will drop $1k on that per year.
I pay $75 per week to my personal trainer and where I live trainers are cheap. People routinely pay hundreds per week in places like LA.
I’m not sure I’d pay that for an online trainer but if there are probably things a step or two away from workouts where I would pay for an internet mitigated version.
But that’s not being a fan, that’s buying a service.
I’m not sure I’d pay that for an online trainer but if there are probably things a step or two away from workouts where I would pay for an internet mitigated version.
But that’s not being a fan, that’s buying a service.
Apps like Shred are pretty good for this now...
How expensive can a banana really be? $10?
I have seen people drop over $1000 dollars in gifted subscriptions/coins over the course of a single stream where a guy is just playing a video game. I'll admit that this kind of thing isn't common, and you definitely aren't going to find 100 people with that level of disposable income for your following, but there are plenty of people who blow what seems like an unreasonable amount of money just so a stranger on the other side of a screen will notice them.
I kinda hate the current media though. I would definitely pay $1000 for the content that I want, content that caters to me.
So what you're saying is this is just a restatement of the original article, but by someone who actually does earn $1k in a single day and so doesn't realise that's not a reasonable amount to spend.
At this moment I'm paying GPBBD https://www.youtube.com/channel/UC3CBOpT2-NRvoc2ecFMDCsA $600/year. Wintergatan https://www.youtube.com/channel/UCcXhhVwCT6_WqjkEniejRJQ gets $120
And its a steal.
And its a steal.
But you know, $1000 a year is only $84/mo, which is less than $4 per day. It's the price of a fancy starbucks coffee probably.
So this is the problem with "starbucks coffee daily" argument - you are assuming people spend money logically/rationally, most people don't. That is why folks don't have any problem dropping $4 every single day at Starbucks (their coffee isn't even that good), but they won't spend $5 per month for something as important as email and depend on free email like GMail.
$84 is more than I pay monthly for Spotify, Netflix, the local newspaper, my broadband connection and occasional magazine buys combined. $1000 is more than I spend yearly on my biggest hobby - and that includes air travel and hotel fares. I have a really hard time coming up with any kind of content that'd be worth that much money.
I think the point is that Netflix and your local newspaper don't interact with you, personally in a one-on-one, honest, direct interaction. At an $84/mo subscription level, that's what you're buying.
Now this may be because the buyer is a true-believer or whatever, but equally likely because they're now able to drop a name around the dinner table, tell their friends that they're in direct dialogue with a 'name',... Status signalling, in a phrase. Tell me why some (rich!) people are willing to pay millions of dollars for a painting that looks like a couple of wet blobs on a half-plastered wall. Same forces at work, I suspect.
Now this may be because the buyer is a true-believer or whatever, but equally likely because they're now able to drop a name around the dinner table, tell their friends that they're in direct dialogue with a 'name',... Status signalling, in a phrase. Tell me why some (rich!) people are willing to pay millions of dollars for a painting that looks like a couple of wet blobs on a half-plastered wall. Same forces at work, I suspect.
Not denying your point, but the wet blob painting is probably considered an investment that is expected to increase in value over time, unlike a Youtube video.
Ah, the starbucks coffee analogy.
Problem is, you can only drink so many fancy starbucks coffees per day. There are many more content creators around.
What will the customers do when everyone wants a starbucks coffee per day? Pay one? Pay no one?
Also don't forget that not everyone is living in the HN well paid tech ivory tower. Even in the US, there should be a lot of people who can't afford a starbucks coffee per day...
Problem is, you can only drink so many fancy starbucks coffees per day. There are many more content creators around.
What will the customers do when everyone wants a starbucks coffee per day? Pay one? Pay no one?
Also don't forget that not everyone is living in the HN well paid tech ivory tower. Even in the US, there should be a lot of people who can't afford a starbucks coffee per day...
Guys what if...
You had 200 fans each paying 500 a year?
Amazing right? 500 is less than 1000 and 200 isn’t that much more than 100.
Feel free to take down the OP and put this comment up instead
Amazing right? 500 is less than 1000 and 200 isn’t that much more than 100.
Feel free to take down the OP and put this comment up instead
Have you considered 123.5 fans? ;) The 0.5 is a half-broke student only paying attention sometimes.
The problem with the "passion economy", which was alluded to in another comment, is that it strengthens the already too-prevalent assumption that everything can and should be monetizable. Markets are useful but they don't need to be involved in every aspect of existence.
Sure, you don’t need to participate in Patreon to make stuff, but the trend seems to be toward relying on consumer market forces to fund culture. Tying the livelihoods of creators to the approval of their fans will lead them to censor themselves and consequently you aren't going to get anything that really pisses people off or challenges them in a countercultural way, at least enough to stop buying your stuff.
The idea of basic income seems like a better path forward, in terms of preserving artistic integrity (i.e. not "make money" or "please your fans" as the motive for making things). Everyone will get enough money to survive, no matter how much your ideas go against the zeitgeist.
Sure, you don’t need to participate in Patreon to make stuff, but the trend seems to be toward relying on consumer market forces to fund culture. Tying the livelihoods of creators to the approval of their fans will lead them to censor themselves and consequently you aren't going to get anything that really pisses people off or challenges them in a countercultural way, at least enough to stop buying your stuff.
The idea of basic income seems like a better path forward, in terms of preserving artistic integrity (i.e. not "make money" or "please your fans" as the motive for making things). Everyone will get enough money to survive, no matter how much your ideas go against the zeitgeist.
I just looked at Kajabi for the first time and feel similarly. A bunch of 'coaches' selling courses to other coaches, etc.
Yeah, this is a tragic outcome for culture in general but free content isn’t sustainable either, people need to pay for rent, food, and other expenses. Im still waiting for the micropayments system to spring into existence..
I cannot think of a more trivial reason to fundamentally restructure the economy.
To allow people to focus on meaningful pursuits rather than work largely superfluous jobs to survive?
Yeah, sounds really trivial.
Yeah, sounds really trivial.
That's an argument, but not the one you made above.
> The idea of basic income seems like a better path forward, in terms of preserving artistic integrity (i.e. not "make money" or "please your fans" as the motive for making things). Everyone will get enough money to survive, no matter how much your ideas go against the zeitgeist.
As in, the Patreon model isn't the best for artists, a better model is a complete rework of the economy, which would remove the need for artists to please their fans.
Extraordinarily trivial.
> The idea of basic income seems like a better path forward, in terms of preserving artistic integrity (i.e. not "make money" or "please your fans" as the motive for making things). Everyone will get enough money to survive, no matter how much your ideas go against the zeitgeist.
As in, the Patreon model isn't the best for artists, a better model is a complete rework of the economy, which would remove the need for artists to please their fans.
Extraordinarily trivial.
Again, I think redesigning the economy to allow people to explore the human experience and create all forms of art without the need to make a living or be a crowd-pleaser is an extraordinarily noble goal.
Are we talking about a Star-Trek era future, once we've achieved something akin to full automation? Or do you think that this is something that is worth pursuing in the short term? Specifically, I'm curious as to who keeps the lights on in this new economy, and why they are working when work is unnecessary.
Eh, I don't think we need full automation. There are plenty of superfluous jobs today and the number of people to "keep the lights" on is probably 5% of the population or less.
Currently ~60% of the adult population is employed. How do you knock that down to 5%, while taxing that 5% enough to support the other 95%, without taxing so much that working isn't worth the effort?
It sounds like you're advocating for a planned economy with 5% participation, which seems odd given that planned economies haven't worked in the past with 10X the workforce.
I think there's a bit of confusion here in the way the author frames these 100 people. At this level they are not fans. They're not supporting you out of some sort of emotional attachment. They are giving you $1000 a year because they believe that the service or product you provide is worth that much. They're customers and that's all.
The "whale" archetype is just a modern version of what has always existed with MLM and self-help gurus where they pray on rich and emotionally vulnerable people. It's an absolutely tiny group of people that will never translate to a widespread economy.
Conflating the 1000 true fans concept with this is a mistake in my opinion.
The "whale" archetype is just a modern version of what has always existed with MLM and self-help gurus where they pray on rich and emotionally vulnerable people. It's an absolutely tiny group of people that will never translate to a widespread economy.
Conflating the 1000 true fans concept with this is a mistake in my opinion.
> On Patreon, the average initial pledge amount has increased 22 percent over the past two years.
22% is not the same as 10,000%. Nowhere near it.
> Since 2017, the share of new patrons paying more than $100 per month—or $1,200 per year—has grown 21 percent.
Is this a statistics fail? My bet is that this is either $100 over all subscriptions (I pay about $30/mo for 7 or 8 creators on patreon, most in the $1 to $5 range), or the increase is from a number previously so small as to be almost inconsequential, meaning it's still almost inconsequential.
Twitch, on the other hand, I can believe. There's a much more immediate feedback loop there, and creators responding to your pledges directly.
22% is not the same as 10,000%. Nowhere near it.
> Since 2017, the share of new patrons paying more than $100 per month—or $1,200 per year—has grown 21 percent.
Is this a statistics fail? My bet is that this is either $100 over all subscriptions (I pay about $30/mo for 7 or 8 creators on patreon, most in the $1 to $5 range), or the increase is from a number previously so small as to be almost inconsequential, meaning it's still almost inconsequential.
Twitch, on the other hand, I can believe. There's a much more immediate feedback loop there, and creators responding to your pledges directly.
The 1000 fans concept is mostly about gratitude - 'thanks, keep doing what you're doing'.
The 100 fans idea seems to be mostly about expectation - 'I gave you money, now deliver this'.
The article describes customers not fans. The VC'ing of 1000 true fans.
Nevertheless it's great to see an Internet where growing numbers of people are willing to pay individuals for value and have the means to do so.
The 100 fans idea seems to be mostly about expectation - 'I gave you money, now deliver this'.
The article describes customers not fans. The VC'ing of 1000 true fans.
Nevertheless it's great to see an Internet where growing numbers of people are willing to pay individuals for value and have the means to do so.
The fewer
"fans" you have and the more they pay the more power they will have over you and the more demanding they will become. In other words: Your fans turn into patrons and will have a major influence on your work.
Also their demand might drive you in a corner you may not be able to easily escape. As with everything, focus is good but too much focus can be a risk as well.
Also their demand might drive you in a corner you may not be able to easily escape. As with everything, focus is good but too much focus can be a risk as well.
> As the Passion Economy grows, more people are monetizing what they love.
As a sentence this just fills me with dread. And it's hard to say why because I know, for example, that a writer making a living from selling their books could be said to be "monetizing what they love" OR engaging in the "Passion Economy".
But if I was to try and get to the heart of it it's simply that I don't want to monetize what I love. I want it to be the one part of my existence not dominated by money. And I don't want an actual passion (awful word really) to form part of an economy.
As a sentence this just fills me with dread. And it's hard to say why because I know, for example, that a writer making a living from selling their books could be said to be "monetizing what they love" OR engaging in the "Passion Economy".
But if I was to try and get to the heart of it it's simply that I don't want to monetize what I love. I want it to be the one part of my existence not dominated by money. And I don't want an actual passion (awful word really) to form part of an economy.
I agree, and I also think that the sentiment that turning a passion into a job is somehow beneficial because "you will never work a day in your life" is untrue. As soon as your livelihood depends on something, you will at some point either have to make sacrifices and trade-offs, or you will starve. Creative passion can only blossom when you can do everything exactly the way you want without compromise, which is unlikely to happen as soon as someone else's expectations come into the mix.
You can have a better, more rewarding and fulfilling career, sure. But never expect it not to feel like a chore a lot of the time.
You can have a better, more rewarding and fulfilling career, sure. But never expect it not to feel like a chore a lot of the time.
I used to agree this, but this leads to what I think is a pernicious belief stated differently: that you can only make "true art" if you're giving it away for free.
This comes up a lot when making indie games. That your work is somehow less pure or you had to compromise on your creative vision because you had to monetize it. As a creator you have to make a ton of tradeoffs all the time anyway, since you have a finite amount of time and resources. What if monetizing it actually allows you to achieve the vision you had in mind? Or it helped you understand what your audience cares about and make something more relatable or moving (or go the other direction, disturbing or meant to role them up etc) Why isn't monetizing just another trade-off? What's so special about it?
The answer to me: culturally monetizing/greed in art has been seen as making art impure and it's a stigma we need to get over.
This comes up a lot when making indie games. That your work is somehow less pure or you had to compromise on your creative vision because you had to monetize it. As a creator you have to make a ton of tradeoffs all the time anyway, since you have a finite amount of time and resources. What if monetizing it actually allows you to achieve the vision you had in mind? Or it helped you understand what your audience cares about and make something more relatable or moving (or go the other direction, disturbing or meant to role them up etc) Why isn't monetizing just another trade-off? What's so special about it?
The answer to me: culturally monetizing/greed in art has been seen as making art impure and it's a stigma we need to get over.
Nah.
I work a bit as a musician, and I would say I often, but not always, create "true art" when I'm hired for a concert.
But it's not the same art I would have made if I got to call all the shots. That doesn't necessarily make it any less good, and it doesn't make it less "true", but it _does_ make it less _mine_. I'm OK with that tradeoff.
I work a bit as a musician, and I would say I often, but not always, create "true art" when I'm hired for a concert.
But it's not the same art I would have made if I got to call all the shots. That doesn't necessarily make it any less good, and it doesn't make it less "true", but it _does_ make it less _mine_. I'm OK with that tradeoff.
I think the discussion about what constitutes "true art" is separate from this. I'm saying that in the long run, it is unlikely that you can keep passionate about something you depend on for food and shelter. I, too, can think of examples where either monetizing up front or simply happening to create something that made you rich has been combined with true passion.
But, if you're going to spend the rest of your life creating something and expect to keep earning money from it, there will be less passion and more tedium.
> Or it helped you understand what your audience cares about and make something more relatable or moving
I'd say that's not about your passion or vision, then, but rather about creating something others will feel passionate about. It's a big difference.
But, if you're going to spend the rest of your life creating something and expect to keep earning money from it, there will be less passion and more tedium.
> Or it helped you understand what your audience cares about and make something more relatable or moving
I'd say that's not about your passion or vision, then, but rather about creating something others will feel passionate about. It's a big difference.
I share your sentiment. In some way I think eventually you make some compromise between income and passions.
If the thing you truly love can make a lot of money then I would say one should do that but reflect on how not to start hating it. Even hobbies require discipline, but you don't see them as forced on you.
Career choices to me are more a process of elimination than choosing, especially if you have many things that you are interested in.
If the thing you truly love can make a lot of money then I would say one should do that but reflect on how not to start hating it. Even hobbies require discipline, but you don't see them as forced on you.
Career choices to me are more a process of elimination than choosing, especially if you have many things that you are interested in.
>Career choices to me are more a process of elimination than choosing, especially if you have many things that you are interested in.
I didn't see it this way until now, but when I rewind this is exactly how I came to study CS. Thanks for the insight.
I didn't see it this way until now, but when I rewind this is exactly how I came to study CS. Thanks for the insight.
An economy is just a group of people all making resource allocation decisions. I have no idea why you’d want to exclude passion from the decision making process of the worlds billions of economic actors.
That is the definition of an economy in abstract - it is ignorant of the historical factors which have created this particular global economy, and it is ignorant of the large and small scale social dynamics influencing the economy and influenced by it. It is ignorant of the necessary rights, as they are formed today, to sustain the economy. It is ignorant of commodity fetishism and alienation, and the fact that an economy must reproduce itself daily, hourly.
There are many criticisms of this economy that we currently have, and the creeping monetization of the last vestige of private life in which we don't need to currently sell, those hours after work and before sleep.
"Why exclude this?", as you ask, simply shows you think that there is no space to resist the totality (I would sometimes go as far as to say tolatitarianism) of "the economy". No space is free, because we have given up resisting it.
There are many criticisms of this economy that we currently have, and the creeping monetization of the last vestige of private life in which we don't need to currently sell, those hours after work and before sleep.
"Why exclude this?", as you ask, simply shows you think that there is no space to resist the totality (I would sometimes go as far as to say tolatitarianism) of "the economy". No space is free, because we have given up resisting it.
Then don’t monetize. No one is coercing anyone to do anything they themselves don’t wish to. Those creators that don’t want to monetize their own labor...can still choose to not monetize. There is no coercion here.
You're correct, but that's not a reason against trying to change the system. There were many economic phenomena through history people have consented to, and not all of them good for society as a whole - sometimes with disastrous consequences.
All economies are made exclusively of economic actors (which include every single living person) making resource allocation decisions. This is the basis of every conceivable economic system, including no system at all (which would just be the ultimate free market), and socialism (which is just a system where resource allocation decision making is taken away from individuals, and placed in the hands of a central authority). These resource allocation decisions include decisions that have no relation to money, and decision to allocate a finite resource is an economic decision, including decisions to devote time, effort or attention to something. Wanting topic of passion to be excluded from this system defies the laws of nature itself. However, I’ll assume that you’re taking the (ironically ignorant) position that economics is only about money. Even then the idea that “I wouldn’t want to derive value from things that I’m passionate about” or that “I wouldn’t want to provide value to those who produce things I’m passionate about” just completely defies any sense of reason.
>All economies are made exclusively of economic actors (which include every single living person) making resource allocation decisions
All economies are made of people, some of whom do not make resource allocation decisions (because they are unable to or prohibited). I see no reason to start talking in terms of the population of an economy rather than other factors first. Marx, for instance, used property and classes, because he noticed that individuals are born into pre-existing situations, as defined by the class and property structures of the day, and they do not shape the world freely as they see fit. It takes effort to individuate.
> including no system at all (which would just be the ultimate free market)
The "ultimate free market" very clearly has a "system" - it has private property rights, separation of the labourer from the product she makes during the production process, the majority of labour being waged labour, and the general economic goal of capital accumulation. If the free market really meant "no system", but still a reality, then we would have observed it in the most basic societies. Anthropologists have found no evidence of that claim.
>which is just a system where resource allocation decision making is taken away from individuals, and placed in the hands of a central authority
No political philosopher uses this definition; most forms of socialism (theoretically, anyway) are democratic, in which allocation decision making is given to the people, to a higher degree than it is in a capitalist society. Finally, in such a system, individuals have the greatest degree of control over capital, not just labour allocation (through which capital is influenced only directly).
>and decision to allocate a finite resource is an economic decision, including decisions to devote time, effort or attention to something
It is not purely an economic decision, it is also a moral and practical one. Only the economist, strangely, conceives any and all time as a pure "resource" to be allocated around. The view that activity is equal to allocation of finite resources ignores the reasons why people actually perform various activities. Sure, you could subsume every motivation into allocation of finite resources, but the physicist could go further and subsume every interaction into the interactions between atoms. Why should I (or anyone) prefer your level of abstraction rather than saying it is too restricted (e.g. as the physicist would say) or saying it is too wide (e.g. as the sociologist would say)?
>Wanting topic of passion to be excluded from this system defies the laws of nature itself.
Marx noted in the 19th century that economists, like the priests, have a preference for speaking of their ideological view as "natural law", that previous systems were "unnatural", that future possible systems are "unnatural". He realized that this tactic ensures that nobody can question the foundation of the concepts (atomistic individualism, Hobbesian warfare, resource allocation, the origin of money, capital, power, property) since that would be to question "nature" itself.
>just completely defies any sense of reason.
It defies purely economic reason. Today we see many people and hobbyists taking such an "unreasonable" stance, from charity and open source workers to musicians. People, as it turns out, are not rational economic actors (the "resaon" you speak of is a prescriptivism from neoclassical economics), nor do they judge their time as a resource ("time is money" is a mantra that only seems to apply during the business day). There is no evidence that counting time primarity as an economic resource was prevalent in previous societies.
On that note, unless you're monetizing the time you spend posting on HN, you are completely defying any sense of reason. Either that, or you can tell me about your spreadsheet of resource allocation for your day down to the hour by the time you next make a comment, and the calculated opportunity costs associated with each hour.
All economies are made of people, some of whom do not make resource allocation decisions (because they are unable to or prohibited). I see no reason to start talking in terms of the population of an economy rather than other factors first. Marx, for instance, used property and classes, because he noticed that individuals are born into pre-existing situations, as defined by the class and property structures of the day, and they do not shape the world freely as they see fit. It takes effort to individuate.
> including no system at all (which would just be the ultimate free market)
The "ultimate free market" very clearly has a "system" - it has private property rights, separation of the labourer from the product she makes during the production process, the majority of labour being waged labour, and the general economic goal of capital accumulation. If the free market really meant "no system", but still a reality, then we would have observed it in the most basic societies. Anthropologists have found no evidence of that claim.
>which is just a system where resource allocation decision making is taken away from individuals, and placed in the hands of a central authority
No political philosopher uses this definition; most forms of socialism (theoretically, anyway) are democratic, in which allocation decision making is given to the people, to a higher degree than it is in a capitalist society. Finally, in such a system, individuals have the greatest degree of control over capital, not just labour allocation (through which capital is influenced only directly).
>and decision to allocate a finite resource is an economic decision, including decisions to devote time, effort or attention to something
It is not purely an economic decision, it is also a moral and practical one. Only the economist, strangely, conceives any and all time as a pure "resource" to be allocated around. The view that activity is equal to allocation of finite resources ignores the reasons why people actually perform various activities. Sure, you could subsume every motivation into allocation of finite resources, but the physicist could go further and subsume every interaction into the interactions between atoms. Why should I (or anyone) prefer your level of abstraction rather than saying it is too restricted (e.g. as the physicist would say) or saying it is too wide (e.g. as the sociologist would say)?
>Wanting topic of passion to be excluded from this system defies the laws of nature itself.
Marx noted in the 19th century that economists, like the priests, have a preference for speaking of their ideological view as "natural law", that previous systems were "unnatural", that future possible systems are "unnatural". He realized that this tactic ensures that nobody can question the foundation of the concepts (atomistic individualism, Hobbesian warfare, resource allocation, the origin of money, capital, power, property) since that would be to question "nature" itself.
>just completely defies any sense of reason.
It defies purely economic reason. Today we see many people and hobbyists taking such an "unreasonable" stance, from charity and open source workers to musicians. People, as it turns out, are not rational economic actors (the "resaon" you speak of is a prescriptivism from neoclassical economics), nor do they judge their time as a resource ("time is money" is a mantra that only seems to apply during the business day). There is no evidence that counting time primarity as an economic resource was prevalent in previous societies.
On that note, unless you're monetizing the time you spend posting on HN, you are completely defying any sense of reason. Either that, or you can tell me about your spreadsheet of resource allocation for your day down to the hour by the time you next make a comment, and the calculated opportunity costs associated with each hour.
> All economies are made of people
Economies are made of economic actors, which includes ALL people as well as other entities like public institutions, companies, charities...
> some of whom do not make resource allocation decisions (because they are unable to or prohibited)
Every single person in the world is an economic actor. Every single person in the world has the ability to make resource allocation decisions, even if they are only using the labor of their own mind. The incarcerated are economic actors, even literal slaves would still be economic actors.
> most forms of socialism (theoretically, anyway) are democratic, in which allocation decision making is given to the people
A theoretical “democratic socialist” country (theoretical because people have voted socialism in, but never in history have they been allowed the privilege of voting it out) would be a country where the people surrender their natural rights to make their own resource allocation decisions (or at least a significant portion of those rights) to the government.
> The "ultimate free market" very clearly has a "system"
It doesn’t at all. It’s just the way humans (and really all animals) behave in absence of governance that prevents them from doing so. Ancient people most certainly had private property, even if it was shared within the tribe or family or whatever other format of social organisation. It would also pay for you to remember that Marx thought familiar or tribal affiliation was a source of evil, as families tend to care for each other, which he considered to be terribly unfair to anybody who didn’t have a family to care for them.
I would very highly recommend that you at least learn some basic economic concepts (what an economy actually is would be a good starting point) before you go around promoting the abolition of private property.
Economies are made of economic actors, which includes ALL people as well as other entities like public institutions, companies, charities...
> some of whom do not make resource allocation decisions (because they are unable to or prohibited)
Every single person in the world is an economic actor. Every single person in the world has the ability to make resource allocation decisions, even if they are only using the labor of their own mind. The incarcerated are economic actors, even literal slaves would still be economic actors.
> most forms of socialism (theoretically, anyway) are democratic, in which allocation decision making is given to the people
A theoretical “democratic socialist” country (theoretical because people have voted socialism in, but never in history have they been allowed the privilege of voting it out) would be a country where the people surrender their natural rights to make their own resource allocation decisions (or at least a significant portion of those rights) to the government.
> The "ultimate free market" very clearly has a "system"
It doesn’t at all. It’s just the way humans (and really all animals) behave in absence of governance that prevents them from doing so. Ancient people most certainly had private property, even if it was shared within the tribe or family or whatever other format of social organisation. It would also pay for you to remember that Marx thought familiar or tribal affiliation was a source of evil, as families tend to care for each other, which he considered to be terribly unfair to anybody who didn’t have a family to care for them.
I would very highly recommend that you at least learn some basic economic concepts (what an economy actually is would be a good starting point) before you go around promoting the abolition of private property.
>Economies are made of economic actors, which includes ALL people as well as other entities like public institutions, companies, charities...
But if we're applying hyper-reductionism, as in the case when the economists talk about individual actions and choices, all of those things can be further divided into individual actors. Why stop at the level of "economic actors"? Is there any basis for considering society as "economic actors" rather than individuals? But let's say that we can talk in terms of "economic actors" - how is it any less valid to talk about "class"? After all, the company and the property-owning class are both composed of individuals.
>Every single person in the world has the ability to make resource allocation decisions
Many disabled people (mentally, or maybe even otherwise) do not, and many prisoners are forced to operate in more or less a closed system. If "economic actor" really just means "person", why not say that?
>but never in history have they been allowed the privilege of voting it out
The irony here of course is that socialism is not merely a change in leader, but a qualitative change in the structure of society and the economy. It makes no sense to say that socialism is voted in (or out), since if it is voted out, it follows that there is a system of class and property structure in place. The mistake is to think that socilaism is a set of laws or policies, but nobody informed on socialsim would say that.
>where the people surrender their natural rights to make their own resource allocation decisions to the government.
I am skeptical of the "natural rights" hypothesis, and surrendering to the government (or some other authority) has taken place in every society, from property rights to taxes, even to speech (note the many restrictions on speech in the US, for instance). Why, if I have the natural right to withdraw my labour, do companies and governments engage in union busting, for example? And whose resources are allocated? The prisoner, for instance, has involuntarily surrendered some portion of their resource allocation rights, but not all of them. Laws against hiring a hitman or bribery mean that I have surrendered some of my resource allocation rights. And what use is a right when one cannot take advantage of it? Many people employed today do have resource allocation rights, but they cannot take full advantage of that: they could starve. When I am employed, I do not have full allocation rights of my labour product (instead, they are appropriated at the end of the production cycle to be sold).
I haven't received your plan to monetize HN comments, or your resource allocation timetable for today. You're beginning to make me think you haven't calculated the opportunity costs of posting on HN without pay.
But if we're applying hyper-reductionism, as in the case when the economists talk about individual actions and choices, all of those things can be further divided into individual actors. Why stop at the level of "economic actors"? Is there any basis for considering society as "economic actors" rather than individuals? But let's say that we can talk in terms of "economic actors" - how is it any less valid to talk about "class"? After all, the company and the property-owning class are both composed of individuals.
>Every single person in the world has the ability to make resource allocation decisions
Many disabled people (mentally, or maybe even otherwise) do not, and many prisoners are forced to operate in more or less a closed system. If "economic actor" really just means "person", why not say that?
>but never in history have they been allowed the privilege of voting it out
The irony here of course is that socialism is not merely a change in leader, but a qualitative change in the structure of society and the economy. It makes no sense to say that socialism is voted in (or out), since if it is voted out, it follows that there is a system of class and property structure in place. The mistake is to think that socilaism is a set of laws or policies, but nobody informed on socialsim would say that.
>where the people surrender their natural rights to make their own resource allocation decisions to the government.
I am skeptical of the "natural rights" hypothesis, and surrendering to the government (or some other authority) has taken place in every society, from property rights to taxes, even to speech (note the many restrictions on speech in the US, for instance). Why, if I have the natural right to withdraw my labour, do companies and governments engage in union busting, for example? And whose resources are allocated? The prisoner, for instance, has involuntarily surrendered some portion of their resource allocation rights, but not all of them. Laws against hiring a hitman or bribery mean that I have surrendered some of my resource allocation rights. And what use is a right when one cannot take advantage of it? Many people employed today do have resource allocation rights, but they cannot take full advantage of that: they could starve. When I am employed, I do not have full allocation rights of my labour product (instead, they are appropriated at the end of the production cycle to be sold).
I haven't received your plan to monetize HN comments, or your resource allocation timetable for today. You're beginning to make me think you haven't calculated the opportunity costs of posting on HN without pay.
Hi Claudia, I saw a comment of yours that had to do with on-line sexuality. I would really love to quote you on it for a manual for a tarot deck I'm creating. If you can could you reply here for find @outsidertarot on instagram and shoot me a message? Thanks!
Sure, go for it.
Isn't an economy specifically about optimising resource allocation. The more general term being a financial system.
I assume you're being purposefully terse, but just in case ... can you see how one might want to do an activity without considering 'could I charge people [more] to enjoy this with me, could I end this activity with less opportunity cost lost' and instead just be generous with something one loves and free with ones use of time when having fun?
I assume you're being purposefully terse, but just in case ... can you see how one might want to do an activity without considering 'could I charge people [more] to enjoy this with me, could I end this activity with less opportunity cost lost' and instead just be generous with something one loves and free with ones use of time when having fun?
An economy is any system that involves the production, consumption and trade of goods. It’s simply a way of describing and analysing natural human behaviour. An economy doesn’t have to aspire towards any form of efficiency, it doesn’t have to involve money, or any form of payment. It doesn’t need to be governed, or subject to any form of authority. It is simply what happens when you have people consuming or utilizing anything that was produced by another person. The only way you could exercise a passion without any economic interactions is if you did so entirely by yourself, without the use of any goods or services produced by another person, and without sharing any of the value you may potentially be creating with any other person.
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The "passion economy" is flooding the Internet with low SNR material and making it harder and harder to get to high quality information.
Creators create not to meet some sort of quota or "monetize" but because they need to create. It's the same for artists. True art exists because it has to come out no matter what. Monetization doesn't come into it at all. This is an important point that the passion economy vultures don't seem to grasp. What we see today is monetization becoming THE purpose and overriding everything else.
Creators create not to meet some sort of quota or "monetize" but because they need to create. It's the same for artists. True art exists because it has to come out no matter what. Monetization doesn't come into it at all. This is an important point that the passion economy vultures don't seem to grasp. What we see today is monetization becoming THE purpose and overriding everything else.
Monetisation is a cult in its own right.
The idea that everything has to be about the hustle is toxic and entirely insane.
The idea that everything has to be about the hustle is toxic and entirely insane.
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I call bullshit on this 'passion economy' thing. Masses of people never in history could make a living from what they love, and unfortunatelly there is no sign that it will happen now. Musicans, writers, indie-game creators: most of them do their passion besides a day-job.
Long-tail never made much money and with globalisation it is worse than ever. The unfortunate truth is the opposite: not only long tail does not really work, but as Peter Thiel said: money is in monopolies. Non-monopolies 'compete-away' the profit.
As a developer, you are better off to go work for a monopoly: they pay well. (Google, Facebook, etc).
(This does not mean I do not have a passion project ('indie game'), I just know that the chance that it can replace my day-job is quite low.)
As a developer, you are better off to go work for a monopoly: they pay well. (Google, Facebook, etc).
(This does not mean I do not have a passion project ('indie game'), I just know that the chance that it can replace my day-job is quite low.)
RE: the appeal to history
Things are different now. People consume much more media, which is much more diverse than ever before. Thank population growth and the iPhone. Today, there are YouTube channels that only write video essays about The Simpsons, webcomics about engineering, blogs about crystal healing, and cartoon porn; you name it, there's probably a significant audience for it these days. The number of audiences and their sizes only get bigger with population growth, whereas an artist only needs a certain number of sponsors to sustain them, whether it's 100 or 1000.
The real obstacle is monetization, which primarily comes down to the business skills of the artist/producer, as well as competition between fungible alternatives (why pay $20 to watch a video when I can watch it on YouTube for free) and other external factors.
Things are different now. People consume much more media, which is much more diverse than ever before. Thank population growth and the iPhone. Today, there are YouTube channels that only write video essays about The Simpsons, webcomics about engineering, blogs about crystal healing, and cartoon porn; you name it, there's probably a significant audience for it these days. The number of audiences and their sizes only get bigger with population growth, whereas an artist only needs a certain number of sponsors to sustain them, whether it's 100 or 1000.
The real obstacle is monetization, which primarily comes down to the business skills of the artist/producer, as well as competition between fungible alternatives (why pay $20 to watch a video when I can watch it on YouTube for free) and other external factors.
The 1000 True Fans essay is specifically targeting the small transition region in the long tail graph where the tall head becomes a long tail. The thesis is that most creators aren't going to end up in the tall head (statistically) so they should target that transition region because it offers a good living doing some artistic endeavor.
At the high end of the transition region people can make a good living, at the low end they can significantly augment their day job.
At the high end of the transition region people can make a good living, at the low end they can significantly augment their day job.
Sure, I totally agree, I think the realistic outcome is that we see a trend in more fields towards the 'rockstars' and 'pro players' but instead of having them behind gatekeepers (teams, agents, etc.) they're on platforms
Maybe the passion project can make an impact within the monopoly? E.g. use indie game dev knowledge to improve costumer engagement with the product?
Is that a good thing? "Engagement" is usually toxic Skinner boxing.
Most things can be used for good or ill. A well defined and engaging UI can certainly be a good thing, if designed appropriately. Most business software is a boring slog to use. Why not design it so the user feels uplifted during the workday? Work could potentially benefit the person as well as the company bottom line, and become a virtuous whole.
If you want irrational amounts of money, you need a monopoly.
But I don't see any problem with 6 figure Engineers working competitively.
Is that not enough money?
But I don't see any problem with 6 figure Engineers working competitively.
Is that not enough money?
While this is well written, I would urge people to NOT to follow this advice. Subscriber churn is a real thing and losing $1000/yr subscriber hurts way more than losing $100/yr subscriber. Additionally, it takes an order of magnitude more effort for conversion and your product has to almost match the utility of a smartphone produced by $1T company to even demand that kind of automated recurring payments. The vast majority of fun creative content won't qualify for this anyway.
However, my bigger beef is with the subscriber model itself which somehow every person wants to impose for their next product. The fact is that it is much easier to convince me to pay $10 to get a new release instead of forcing on me $10/yr subscription. The subscription should be optional merely provided as a convenience to the customers who find themselves paying you again and again, not as requirement to use your product. This is a true customer-obsessed point of view. If you have something good to sell, make at least part of it free so people know the value to expect. Rest make it one-time fee and create your upgrades/releases appealing enough so people buy them recurringly!
However, my bigger beef is with the subscriber model itself which somehow every person wants to impose for their next product. The fact is that it is much easier to convince me to pay $10 to get a new release instead of forcing on me $10/yr subscription. The subscription should be optional merely provided as a convenience to the customers who find themselves paying you again and again, not as requirement to use your product. This is a true customer-obsessed point of view. If you have something good to sell, make at least part of it free so people know the value to expect. Rest make it one-time fee and create your upgrades/releases appealing enough so people buy them recurringly!
>The fact is that it is much easier to convince me to pay $10 to get a new release instead of forcing on me $10/yr subscription.
For the average person this is not the case assuming you as a creator are trying to extract similar value. That means you're pushing out a new release every year. That either means the new release invalidates the old one or is so enticing every time that people keep buying it without skipping releases as they think about it or are reminded unlike a subscription which can be automated.
For the average person this is not the case assuming you as a creator are trying to extract similar value. That means you're pushing out a new release every year. That either means the new release invalidates the old one or is so enticing every time that people keep buying it without skipping releases as they think about it or are reminded unlike a subscription which can be automated.
Do both instead. Do something where you can offer tiers. Group lessons (100/yr subscribers) vs Individualized (1000/yr).
I'd suggest not doing tiers. Segmentation is repulsive. Why do I ever want to be a bronze-level customer in your product world? It perhaps makes sense for products that have monopolized or established firmly or where costs are truely substantial as feature/utilization is increased. However, most likely is often the side effect of throwing in the MBA part of your brain to squeeze in that last bit of revenue juice without you having to improve the tech. In essence, just luring in customers with "low starting from..." prices and then telling them they are fools to expect those prices. I tend to distrust products that rely on segmentation to inflate revenues and I think they are often ripe for disruption. At least, for creative/educational products please don't tell your customers that they are 3rd class citizens in your world unless they allow you to completely squeeze them out.
Different price tiers are a completely normal thing. Put another way, why would I have to buy the premium package when all I want is much more simple?
Trying to make all your customers fit just one single pricing model is bad for business.
Trying to make all your customers fit just one single pricing model is bad for business.
"Segmentation is repulsive" -- this makes no sense as a blanket statement without product context.
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Tiers have worked out amazingly on Patreon. It's monumental.
I didn't read the article as advice, rather as pointing up/sharpening the differences between two variants of online subscription model.
It's of course easy to prove if you define the nebulous 'true fans' as 'fan enough so that $X from each of them support me financially'.
I'm not against the idea but I know some creatives who operate in spaces where asking $1k a year is a tough sell. I don't think many people are paying that for knitting or gardening lessons even from the best but hey, maybe I'm wrong.
It makes sense for skills that can be monetised into a career. A cake decorator I know said the risk is that you're training your replacements (but she also said you might as well, or someone else will).
I'm not against the idea but I know some creatives who operate in spaces where asking $1k a year is a tough sell. I don't think many people are paying that for knitting or gardening lessons even from the best but hey, maybe I'm wrong.
It makes sense for skills that can be monetised into a career. A cake decorator I know said the risk is that you're training your replacements (but she also said you might as well, or someone else will).
The logical conclusion of this trend has already been reached: Adam Neumann only needed 1 true fan.
But finding those 100 people who care enough to pay for whatever it is you're producing must have a cost.
There are more ways to reach people now but considering the amount of noise out there it's like finding a needle in a haystack or perhaps worse as it's more likely, at least for an artistic project that they would need to find you.
That's without considering the fragility of a business that depends on 100 people. I just find something hokey and fake about this idea of having 100 or 1000 true fans to support you. It's especially grating coming from a VC firm whose basis for existence is growth, growth and more growth and then capitalising on that growth in the most ruthless and efficient way possible.
There are more ways to reach people now but considering the amount of noise out there it's like finding a needle in a haystack or perhaps worse as it's more likely, at least for an artistic project that they would need to find you.
That's without considering the fragility of a business that depends on 100 people. I just find something hokey and fake about this idea of having 100 or 1000 true fans to support you. It's especially grating coming from a VC firm whose basis for existence is growth, growth and more growth and then capitalising on that growth in the most ruthless and efficient way possible.
the cost is immense. Look at how much money Jeb Bush spent in 2015 to get fans. Like finding a needle in a silo. Some people can do it much easier, but it's random. there is no rule or strategy to reliably get fans quickly.
Apart from the practicality of the business process, I would say if your content is in any way "edgy" or skirts close to the edge of the Overton Window [1] I would try and self-host as much as possible. It would be all too easy for a twitter-storm to get you kicked off social media, twitch, patreon, cloudflare, stripe, paypal etc and then your business disappears overnight.
[1] https://en.wikipedia.org/wiki/Overton_window
[1] https://en.wikipedia.org/wiki/Overton_window
What I got from this post:
Network economy matches userland economy.
We should henceforth refer to billionaires as "whales".
Network economy matches userland economy.
We should henceforth refer to billionaires as "whales".
Is this what trickle down to economy looks like?
I'd like to see what a ring based economy would look like
Next up: 1 true fan.
Also called: your employer
The No Agenda podcast from Adam Curry and John C Dvorak have seemingly successfully worked this model. No adverts, but donation only. Of course many listen to free, but creating producers out of those who donate and giving them credits and shout outs has built an interesting community.
What doesn’t work is to cut your prime value out just to those who pay. Then you can’t build momentum and the large fan base.
What doesn’t work is to cut your prime value out just to those who pay. Then you can’t build momentum and the large fan base.
Is it just me or Passion Economy is a totally empty marketing BS term that doesn't really mean anything?
> Here’s how it works: A creator can cultivate a large, free audience on horizontal social platforms or through an email list. He or she can then convert some of those users to patrons and subscribers. The creator can then leverage some of those buyers to higher-value purchases, such as extra content, exclusive access, or direct interaction with the creator.
having a couple blogs/influencer pages with 20k+ followers are actually most useful (IMO) when starting new brands on new platforms and slowly monetizing (ala gary v's Jab, Jab, Jab, Right Hook as corny as he is it works)
> As the Passion Economy grows, more people are monetizing what they love
it's simply fun growing a brand/discovering new communities/creating one/watching the engagement and metrics
having a couple blogs/influencer pages with 20k+ followers are actually most useful (IMO) when starting new brands on new platforms and slowly monetizing (ala gary v's Jab, Jab, Jab, Right Hook as corny as he is it works)
> As the Passion Economy grows, more people are monetizing what they love
it's simply fun growing a brand/discovering new communities/creating one/watching the engagement and metrics
Maybe for a kid paying for school or saving it could be OK, but 100-fans-income is quite volatile. And the end of the day these people are living out from tips, pity and the grace of 1st world country donors (I am saying this while trying not to be controversial).
Most fans may be kids (under 25?) and thus volatile, in the way that the creator is off for 1 day and they'll replace him/her with whatever else is out there, and that's 1 percent per lost fan. Or PayPal can decide that your niche is not convenient to them and cut you out, or a fan loses interest, or... countless reasons.
Very risky for making a living, IMO.
Most fans may be kids (under 25?) and thus volatile, in the way that the creator is off for 1 day and they'll replace him/her with whatever else is out there, and that's 1 percent per lost fan. Or PayPal can decide that your niche is not convenient to them and cut you out, or a fan loses interest, or... countless reasons.
Very risky for making a living, IMO.
We actually see a similar pattern on https://www.anim8.io
A couple animators on our platform have extremely dedicated fans making up the majority of the donation revenue.
A couple animators on our platform have extremely dedicated fans making up the majority of the donation revenue.
It looks to me what a16z has just discovered is a service business. A plumber or an SAT tutor or an upholstery shop or whatever basically just needs 100 customers a year paying around $1000.
Call me cynical, but to me the entire post just reads like an advertisment for the companies in the $1000 column that they've invested in...
s/fan/customer
I feel like the comments here cover the main issues with this article. I kept flip-flopping between appreciating the article and disagreeing with it. The two main issues I have with it are:
1. $1000/year to provide value is a business, not a "passion" in the true sense. 2. Highlighting the outliers of a given platform discredits the concept as something that many people can achieve.
"These fans expect to derive meaningful value and purpose from the product." - yes, that would be a business transaction.
This article could be rewritten to say that if you want to create a life-style business, make sure to generate enough value for someone (or a business) that they would be willing to pay $1000/year for your product. This will make profitability/success much easier.
Yes, the original author of 1,000 True Fans retracted his original views after hearing from musicians, but the general concept/framework doesn't seem to be broken even if the numbers have to be adjusted. The main idea is that you don't need millions of people paying you $1 to have success.
I feel like the comments here cover the main issues with this article. I kept flip-flopping between appreciating the article and disagreeing with it. The two main issues I have with it are:
1. $1000/year to provide value is a business, not a "passion" in the true sense. 2. Highlighting the outliers of a given platform discredits the concept as something that many people can achieve.
"These fans expect to derive meaningful value and purpose from the product." - yes, that would be a business transaction.
This article could be rewritten to say that if you want to create a life-style business, make sure to generate enough value for someone (or a business) that they would be willing to pay $1000/year for your product. This will make profitability/success much easier.
Yes, the original author of 1,000 True Fans retracted his original views after hearing from musicians, but the general concept/framework doesn't seem to be broken even if the numbers have to be adjusted. The main idea is that you don't need millions of people paying you $1 to have success.
I understand what you're getting at but I think the relationship with a 'creator' or artist feels much more personal than that of a business. There's more to this than a simple repeating customer/business transaction.
> This strategy is closely related to the concept of “whales” in gaming, in which 1 to 2 percent of users drive 80 percent of gaming companies’ revenue
Last time I heard of that term - `whale` - it was a reference to a mom whose child was making in-app purchase without her mother's consent and/or knowing. Unethical behavior cursor to the max.
Last time I heard of that term - `whale` - it was a reference to a mom whose child was making in-app purchase without her mother's consent and/or knowing. Unethical behavior cursor to the max.
Everybody should think deeply about ethics and act morally. Exploiting human beings is not okay.
But the idea of "whales" is nearly universal in all lines of business, and there's nothing unethical about it unless your business is already operating in some kind of ethical gray area.
If you are lucky enough to have customers at all, you will have some that spend 10x or 100x as others.
The most obvious example would be a neighborhood restaurant or food truck. Most people in your town might visit once or twice per year, if at all. But then you have your regular customers that you see a few times per week. Somebody who stops by twice a week is spending 100x as somebody who visits once a year.
Same with a department store. Most people buy nothing, some just want a pair of socks, and some will drop $2,000 on a new business wardrobe.
Something worth considering: if your business is one that inspires passionate fans, do you have any options for these folks to spend more? If not, are you kinda leaving a bunch of money on the table and hamstringing your fledgling business? Probably. Of course, this is something that takes ethical consideration and good judgement.
But the idea of "whales" is nearly universal in all lines of business, and there's nothing unethical about it unless your business is already operating in some kind of ethical gray area.
If you are lucky enough to have customers at all, you will have some that spend 10x or 100x as others.
The most obvious example would be a neighborhood restaurant or food truck. Most people in your town might visit once or twice per year, if at all. But then you have your regular customers that you see a few times per week. Somebody who stops by twice a week is spending 100x as somebody who visits once a year.
Same with a department store. Most people buy nothing, some just want a pair of socks, and some will drop $2,000 on a new business wardrobe.
Something worth considering: if your business is one that inspires passionate fans, do you have any options for these folks to spend more? If not, are you kinda leaving a bunch of money on the table and hamstringing your fledgling business? Probably. Of course, this is something that takes ethical consideration and good judgement.
Your examples aren't really of whales, because there's an upper limit on how much food/clothes you can get.
The whale term was invented by casinos wasn't it? Where there's no upper limit to how much you can lose.
The whale term was invented by casinos wasn't it? Where there's no upper limit to how much you can lose.
There's an upper limit to the amount that you can consume.
There is no upper limit on the amount you can pay.
There is no upper limit on the amount you can pay.
Sure there is, unless you consider incurring infinite debt a positive thing.
The real business that A16Z wants is aggregating millions of passion projects. Must have been pitched by something like that
I feel like these numbers are skewed by the sex workers on Patreon offering subscription pornography. It'd be interesting to see if there's a difference between the numbers adult content creators see vs. everyone else.
I don't think people who create adult content should be excluded. It's a valid job which — like streaming, painting, or any other online content creation — just isn't for everyone.
Yeah I agree. I wasn’t suggesting that it is or should be illegal and banned. I’m just saying that the economics for that business are so different than every other creative and performing art that it really distorts what non-adult content creators can expect to make from their patrons.
This talk from MicroConf discusses a similar idea and the origins of the 1000 true fans allegory: https://youtu.be/otbnC2zE2rw?t=273
I would like to see some stats from youtube and other platforms actually auditing those sub counts. I really have a hard time believing some youtube channels actually have 10,000 subs, let alone a million. While I agree with the article and the tier system, patreon is basically an e-begging platform. I understand that probably isn't popular to say but that is how I see it.
>patreon is basically an e-begging platform
This is more true for some people than others. A decent number of YouTubers I know have their patreons set up to only charge customers after they put out a video, so if several months go by without any new content they aren't just pulling a salary from patrons. This model is only really relevant to YouTubers who put effort into fewer videos released farther apart, rather than those with weekly or even daily releases of vlog content, but still it feels like a fair way of doing things where they are essentially being paid for releasing something and not like begging.
Contrast this with some people I see on twitter who have a patreon... just for tweeting? Occasionally there is a spin put on it about being a minority or disabled and taking donations, but this definitely feels much more like e-begging, even though I guess you could try and make the argument that tweets are just as valid "content" as youtube videos.
This is more true for some people than others. A decent number of YouTubers I know have their patreons set up to only charge customers after they put out a video, so if several months go by without any new content they aren't just pulling a salary from patrons. This model is only really relevant to YouTubers who put effort into fewer videos released farther apart, rather than those with weekly or even daily releases of vlog content, but still it feels like a fair way of doing things where they are essentially being paid for releasing something and not like begging.
Contrast this with some people I see on twitter who have a patreon... just for tweeting? Occasionally there is a spin put on it about being a minority or disabled and taking donations, but this definitely feels much more like e-begging, even though I guess you could try and make the argument that tweets are just as valid "content" as youtube videos.
I do now think 1K/year is something that will sustain in time. Passion wears out.
Just watched a MicroConf talk mentioned "1000 fan" theory.
This talk covers the origin & debunks the premise of 1000 fans: https://youtu.be/otbnC2zE2rw?t=273
This thesis seems like 1000 True Fans hired patio11.
I was wondering if it was written by patio11. It’s just like his writing style.
What? Not at all imho. He writes very different. He likes to construct more complex sentences. This reads like your average journalist, which is okay, but not particular distinguishable.
Yea I don't think the writing style is patio11 at all. The thesis of, effectively, "charge more", however, is.
I've seen this work before.
Tl;dr: "Sell your customers what they want, make them pay what you say, be sure they're rich enough."
Best paradigm busting advice in business after "If you can secure just 0.1% of the chinese market, you'll have 5 milion customers" and "Always remember: profit is revenue minus expense".
Best paradigm busting advice in business after "If you can secure just 0.1% of the chinese market, you'll have 5 milion customers" and "Always remember: profit is revenue minus expense".
$ whois a1.6z.com
Taking this to extreme :)
100 True Fans ? try 1
Internet has enabled visibility so you need to only find one true fan who is willing to sponsor you 100,000 per year.
Aka your employer.
Funny, but this is not wrong either. It turns out anyone who has a good job is already building something one entity really wants -- themselves. The only difference is that they pay with their time.
Rofl
Actually that's how art has worked for a looong time. Most pre 19th century artists that we remember now had a rich patron who put food on their table (and possibly influenced what they did).
Also called "a job"
In my mind the article reduces to: Paywalls are cool, we need moar of them.
Brilliant!
TLDR: Sell what your customers want to buy.
But let's call the customers fans and rebrand the whole thing not as Capitalism but as "Passion Economy", which sounds a lot more noble than "overcharging random strangers on the internet".
I'm also surprised that "whales" went from a mean joke to mock those with more money than friends into an actual description that they use as a positive term here.
But let's call the customers fans and rebrand the whole thing not as Capitalism but as "Passion Economy", which sounds a lot more noble than "overcharging random strangers on the internet".
I'm also surprised that "whales" went from a mean joke to mock those with more money than friends into an actual description that they use as a positive term here.
TL;DR (1000 * 100) == (100 * 1000)
The _Future_ of the Internet, a post-scarce good, is not going to be a Profit Model Powered by The Extraction Economy.
It needs a fundamentally different economic model, that measures the gain in value added to the network, not the transaction (rebalance, distribution, etc.) of it: http://free.eco .
It needs a fundamentally different economic model, that measures the gain in value added to the network, not the transaction (rebalance, distribution, etc.) of it: http://free.eco .
> a post-scarce good
There is no such thing.
There is no such thing.
God these guys live in a bubble
"Please don't post shallow dismissals, especially of other people's work. A good critical comment teaches us something."
"Don't be snarky."
https://news.ycombinator.com/newsguidelines.html
"Don't be snarky."
https://news.ycombinator.com/newsguidelines.html
i can see my response may have needed a few extra words, however I think referring to my comment in such a fashion is slightly misleading.
I’d hate to think that in this forum, just because a comment is short and succinct - what I thought to be a daily clear response, meaning “the authors live in a bubble of experience and expectations” - it is somehow lesser value that a comment that is long winded and without a clear opinion.
TLDR. I hope HN doesn’t confuse clear and succinct with snarky and sarcastic.
I’d hate to think that in this forum, just because a comment is short and succinct - what I thought to be a daily clear response, meaning “the authors live in a bubble of experience and expectations” - it is somehow lesser value that a comment that is long winded and without a clear opinion.
TLDR. I hope HN doesn’t confuse clear and succinct with snarky and sarcastic.
If it doesn't seem to you like "God these guys live in a bubble" would come across as snarky and sarcastic, it would be good to recalibrate. From my perspective—and I'm pretty sure many other readers' also—it's an internet swipe of precisely the kind we don't want here.
Totally agree that long-winded, empty comments are not the recommended alternative. What we want is curious conversation: thoughtful, substantive comments that contain information. Drive-by putdowns kill that; hence the moderation replies.
Totally agree that long-winded, empty comments are not the recommended alternative. What we want is curious conversation: thoughtful, substantive comments that contain information. Drive-by putdowns kill that; hence the moderation replies.
Well it is a good critical comment but the HN readers are part of the same bubble and don't realize it :)
It is not, it's far too short for that. The way it is now it isn't even a decent invitation to discuss.
dav43 could probably expand it into one easily though. What kind of bubble? Who's in it? Why do they think so? What are the consequences and what could be done about it? etc.
dav43 could probably expand it into one easily though. What kind of bubble? Who's in it? Why do they think so? What are the consequences and what could be done about it? etc.
Well let me expand it again (i have another comment saying the same thing):
HN readers are for the most part highly paid tech workers. Even in the US, tell someone who makes 30k/year that you spend 1K/year on someone's Patreon and he'll think you're crazy... or spit in your face.
HN readers are for the most part highly paid tech workers. Even in the US, tell someone who makes 30k/year that you spend 1K/year on someone's Patreon and he'll think you're crazy... or spit in your face.
> HN readers are for the most part highly paid tech workers
That's a false assumption. HN is much larger than you think, with people all over the US and all over the world. It has highly paid workers, lowly paid workers, people who don't need to work, and people who need to but can't find any.
We tend to make assumptions like "for the most part" based on the internal image when our pre-existing conditions meet a handful of striking data points—say the first 3 or so. And then we don't change it. But which data points happen to strike us are actually a function of our pre-existing conditions also. There are many other data points.
That's a false assumption. HN is much larger than you think, with people all over the US and all over the world. It has highly paid workers, lowly paid workers, people who don't need to work, and people who need to but can't find any.
We tend to make assumptions like "for the most part" based on the internal image when our pre-existing conditions meet a handful of striking data points—say the first 3 or so. And then we don't change it. But which data points happen to strike us are actually a function of our pre-existing conditions also. There are many other data points.
That use of "bubble" is a pejorative, so the comment contained zero information, which means it teaches us nothing.
My thoughts, exactly.
And then they present the idea of selling what your customers want to buy as new ^_^
And then they present the idea of selling what your customers want to buy as new ^_^
Here is a model for the author:
give money to things not to people, people should have enough to live. Food, safe place to stay etc.
i dont want to pay for people to become rich just necause he/she produced a thing I enjoyed.. I dont have to be responsible for artists, creaters being alive, safe etc. I am just a person expects same comfort as creater... creater might have a chance to accomplish his/her passion position in life but most of us should/must do the ugly things... that doesnt mean that people create something are always good at what they do... actually they are not most of the time...
prize tag is for goods not for people...
give money to things not to people, people should have enough to live. Food, safe place to stay etc.
i dont want to pay for people to become rich just necause he/she produced a thing I enjoyed.. I dont have to be responsible for artists, creaters being alive, safe etc. I am just a person expects same comfort as creater... creater might have a chance to accomplish his/her passion position in life but most of us should/must do the ugly things... that doesnt mean that people create something are always good at what they do... actually they are not most of the time...
prize tag is for goods not for people...
[0] Edit: In fact it is (convert). However in the next paragraph the concept is somehow replaced with "whaling", which means that a few paying customers help support a large group of free riders, or conversion in reverse. This is misleading. The large group needs to be there first.
2. At the $1000/year price point, it's not an artistic production anymore. Most examples are about "courses", about teaching something to a specific audience. Some of the topics are questionable and sound a little scammy (physiotherapy?), may be preying on people's vulnerabilities (private coding classes for kids?) or playing on vanity (having a celebrity streamer play along with you). This is Goop territory. Is this the future we want?