Jack Conte wasn’t some starving artist eking out a living when he landed on the idea for Patreon. He and his wife’s indie band called Pomplamoose was pulling in about $400K a year at its height. But after spending three months and maxing out his credit cards producing an intricate music video for the song Pedals, Jack found himself burned out, sitting alone, literally crying from exhaustion. He felt there had to be a better way for creators to get paid for their work. Today, Jack and his co-founder Sam Yam are weighing the cost-benefit of taking Patreon public.CNBC Make It
What is Patreon ?
Patreon is a membership platform that provides business tools for content creators to run a subscription service. It helps creators and artists earn a monthly income by providing rewards and perks to their subscribers. Patreon charges a commission of 9 to 12 percent of creators’ monthly income, in addition to payment processing fees.
Who Uses Patreon ?
Patreon is used by YouTube videographers, webcomic artists, writers, podcasters, musicians, adult content creators, and other categories of creators who post regularly online. It allows artists to receive funding directly from their fans, or patrons, on a recurring basis or per work of art. The company is based in San Francisco.
Who Founded Patreon ?
Patreon was co-founded in May 2013 by developer Sam Yam and musician Jack Conte, who was looking for a way to make a living from his YouTube videos.They developed a platform that allowed ‘patrons’ to pay a set amount of money every time an artist created a work of art.
Patreon Funding Rounds & Acquisition
- The company raised $2.1 million in August 2013 from a group of venture capitalists and angel investors.
- In June 2014, Patreon raised a further $15 million in a series A round led by Danny Rimer of Index Ventures.
- In January 2016, the company closed on a fresh round of $30 million in a series B round, led by Thrive Capital, which put the total raised for Patreon at $47.1 million. They signed up more than 125,000 “patrons” in their first 18 months.
- In March 2015, Patreon acquired Subbable, a similar voluntary subscription service created by the Green brothers, John and Hank Green, and brought over Subbable creators and contents, including CGP Grey, Destin Sandlin’s Smarter Every Day, and the Green brothers’ own CrashCourse and SciShow channels.
- The merger was consequent to an expected migration of payment systems with Amazon Payments that Subbable used.
- In August 2018, Patreon announced the acquisition of Memberful, a membership services company.
The Ultimate Story of Patreon Founder
Patreon has become a $4 billion company in just eight years. The crowdfunding website provides an ongoing extra source of income for hundreds of thousands of creators, some even earning over $200,000 a year.
But the story of Patreon has come a long way since a launch that cost only a few hundred dollars, created by a pair of roommates. One a physics student turned starving artist struggling to get by on YouTube ad revenue, the other a computer sciences student working as a delivery driver.Hook
Cyber Attack on Patreon
In October 2015, the site was the target of a large cyber-attack, with almost 15 gigabytes of password data, donation records, and source code taken and published. The breach exposed more than 2.3 million unique e-mail addresses and millions of private messages.Following the attack, some patrons received extortion emails demanding Bitcoin payments in exchange for the protection of their personal information.
Patreon Subscriber Growth
In January 2017, Patreon announced that it had sent over $100,000,000 to creators since its inception. In May 2017, Patreon announced that it had over 50,000 active creators and 1 million monthly patrons, and was on track to send over $150 million to creators in 2017.