5 creator economy VCs see startup opportunities in monetization, discovery and much more

'Clubhouse has almost replaced podcasts for me, at least temporarily'

Everyone knows YouTubers and other creators are popular with internet users of all ages. But today, these influencers also have real businesses powered by a range of software tools and service providers who help weave videos, pictures, clips, memes and other types of content into sustainable success.

The pandemic added fuel to existing trends pushing growth in this category. Today, the platforms are bigger and more diverse than ever and many creators have years of experience growing audiences and monetizing online. Parallel to this industry, the rapid overall growth of enterprise technologies allow for many new types of creator-focused products to be built. Top investors in the space are seeing new opportunities for startups to build tools that help creators monetize and grow or solve needs that are specific to creator subverticals like gaming or coaching/education. 

For this particular investor survey, we dug through notes from the following:

The blank spaces in the creator economy

As with many industries that fall under the broad banner of tech, digital creators saw an acceleration from COVID-19, investors said. The simple fact that millions of us are inside and on our phones a lot has helped creators expand their audiences. (More on this in our digital media investor survey from the other week.)

More people also became creators. Jin noted that the pandemic has led to “people experimenting with creative hobbies and passions,” which smells like rising creator TAM from our perspective.

A broader definition of what constitutes a creator means more potential customers for startups looking to serve them, and perhaps a greater total revenue in the market could be an impact of COVID.

There are ample places for building in the creator economy, including discovery, which O’Malley cited as a key issue. “The best content doesn’t always rise to the top,” he said, adding that “incentives remain to create content that will be viral and get eyeballs” and to nab the content of others over creating net-new material.


Benjamin Grubbs, founder, Next10 Ventures

What are the new opportunities for creators and startups who are serving creators, within the larger landscape of the big freelance platforms today?

Creators are scaling their social graph faster than before, and as a result are becoming a small business faster than before. Startups recognizing the small business segment of the creator economy are helping people grow from an individual to a SMB to a small enterprise. Each top creator is in effect employing people on a full time or contract basis, driving job growth in the overall economy. Individuals and contractors/freelancers filling production, business development, sales, marketing, finance, legal, etc are needed more than ever before.

For years YouTube had been the sole or major platform fueling the creator economy. Today, multiple platforms reaching 1 billion or more monthly active users is creating a diversified opportunity for creators to grow their social graph and find success as an entrepreneur. Furthermore, the enterprise layer of the creator economy is diversifying from the early days of MCNs focused primarily on YouTube, to companies plugging into multiple platforms and ecosystems.

What has changed since the start of the pandemic? How much of this growth is from the pandemic, versus overall trends that were happening already?

COVID accelerated a lot of change in consumer and corporate behaviors. Livestreaming has been active on the internet since the mid-1990s. When I worked at Yahoo leading their video business in Asia, SARS impacted a company’s ability to conduct in-person conferences and seminars. We saw this play out again in 2020. A big difference is the wide adoption in the last 17 years of mobile internet and viewing video on your smartphone, the broadband access at home, and a host of new startups building for this current user base. As Hollywood soundstages closed, music venues and arenas closed, a wide number of entertainers and musicians pivoted to live video to engage their fan base or commercialize their live experience. Retailers and product manufacturers saw a surge in e-commerce, and a growing interest in bringing live video e-commerce ($130 billion in China in 2020) to North America in a widely adopted manner.

A lot of people previously employed by a traditional media company or dependent on traditional distribution channels adopted online video platforms like TikTok and YouTube, or newsletter platforms like Substack, and built a social graph and a direct line to their fan base. They won’t give up that direct line and the ways in which they now control distribution and pricing after this pandemic subsides.

What types of tools for payments, marketing, and other business needs are catching on with creators now, as they branch out across platforms and become more sophisticated?

Representation across platforms has become more critical than ever.

Platforms like YouTube building tools may only be as good as the creator conducting most of their business on its platform. As creators today have diversified their reach, community and monetization across multiple platforms, tools for payments (e.g., split payment or early payment) may be better designed and operated by startups that are platform agnostic.

What areas have matured and are less interesting to you today versus a year ago?

Consumer-facing short-form video platforms. TikTok, Reels (FB) and Shorts (YT) are all targeting this user experience, and each has shown success or an ability to finance distribution to 1 billion+ MAUs. We are less interested in a startup trying to tackle these companies head on, and instead would look at startups that can feed off of their growth and investment.

What key problems remain to be solved for creator economies to truly succeed?

Monetization, payments, education — not just in North America but in regions like Asia Pacific, Latin America, Africa, Middle East.


Li Jin, founder, Atelier Ventures

What are the new opportunities for creators and startups who are serving creators, within the larger landscape of the big freelance platforms today?

I’m excited about products that enable and make accessible new forms of creativity that may not even exist today. What are future forms of creativity that many more people can participate in?

What has changed since the start of the pandemic? How much of this growth is from the pandemic, versus overall trends that were happening already?

COVID accelerated a shift that was already occurring, transforming our relationship with traditional employment and catalyzing solopreneurship and creative work.

The specific factors that led to this are a combination of: People experimenting with creative hobbies and passions; an erosion of trust in institutions and a consequent push toward individualism; the normalization of virtual relationships and communities; and a need, among many, to generate income virtually.

What types of tools for payments, marketing, and other business needs are catching on with creators now, as they branch out across platforms and become more sophisticated?

Creators are in need of tools across all aspects of their businesses: audience engagement and analytics; new ways to monetize; ways to grow their audiences and move audiences from one platform to another; and tools to operationalize the business admin and ops aspects of being a creator.

What areas have matured and are less interesting to you today versus a year ago?

Overall, I think it’s still a very nascent time in the creator space, but some opportunity areas have become a lot more crowded with a large number of companies (e.g., virtual events, virtual class platforms, etc).

What key problems remain to be solved for creator economies to truly succeed?

Building the middle class of creators: Last December, I wrote about the need for a middle class of creators. Platforms win when a large base of creators believe they can grow and succeed. Solutions include giving emerging creators opportunities for exposure and investment in creator education and wellness.


Brian O’Malley, general partner, Forerunner Ventures

What are the new opportunities for creators and startups who are serving creators, within the larger landscape of the big freelance platforms today?

There are two main opportunities today around the creator ecosystem.

The first is further fragmenting creators into vertical categories. The right tools that drive the right engagement per content type will ultimately drive the best monetization. For travel, TravelJoy can help influencers build actual travel businesses versus just get free stays. For gaming, pro gamers can make more money through coaching and education platforms like Metafy versus YouTube content alone. We expect to see this fragmentation continue just as Craigslist broke into specific companies like AirBnB or Tinder.

The second is around payments and financial services. Creators earn money in a nontraditional way. Banks are not set up to value this revenue stream, even though it can be highly predictable. Contracts and payment infrastructure are not set up to facilitate the organic nature of how creators work together in real time. There is an opportunity for both new plumbing and new brands to emerge in creator financial services.

What has changed since the start of the pandemic? How much of this growth is from the pandemic, versus overall trends that were happening already?

Like many other trends, this movement has accelerated during this time. It was certainly well under way pre-pandemic as evidenced by content and engagement growth across established platforms, while new platforms and mediums were also being introduced and embraced. In a year when daily routines, habits and outlets were upended, people sought new connections and creative outlets online further fielding this trend. [So as] this trend is broadening and reaching scale, opportunities/demand for resources, tools and services have emerged.

What types of tools for payments, marketing and other business needs are catching on with creators now, as they branch out across platforms and become more sophisticated?

We’re seeing services that enable creators to use one platform to create, push content across multiple platforms at once and provide OTT monetization. While the large platforms all have their own creation tools, creators need to be nimble because the benefit to being early to the next platform is massive.

What key problems remain to be solved for creator economies to truly succeed?

Discovery continues to be a real challenge for creators. The best content doesn’t always rise to the top. The incentives remain to create content that will be viral and get eyeballs. It is easier to steal someone else’s joke than to come up with your own. Creators need to be experts at both creation and distribution. There exists an opportunity to bring content together and bundle it in rational ways that make users think less, while also enabling the best material to find an audience. Some people can be focused more on distribution while others are more focused on creation.


Eze Vidra, managing partner, Remagine Ventures

What are the new opportunities for creators and startups who are serving creators, within the larger landscape of the big freelance platforms today?

The main difference is the motivation. Professional freelancers look for gigs on the freelance platforms, and creators focus on building an audience and engagement. The gig economy, where freelancers go today to find projects is slightly different than the “creator economy” or “passion economy,” while there’s some overlap for sure.

For creators the opportunity is to make a living from their passion by reaching an engaged audience. There’s an element of social mobility. I’ve recently heard that a Starbucks barista was able to quit her job to do vocal training (her passion) full time. Jumping early onto new platforms like Clubhouse or Substack can create opportunities for them to grow with the platform. Jumping early onto new platforms like Clubhouse or Twitter’s new newsletter product can create opportunities for them to grow with the platform. The creators can be anything: writers, makers, film makers, gamers, performing artists, coaches, experts and so on.

Tech startups can play a big role by creating tools and platforms to facilitate the various parts of the creator economy value chain: From content creation, distribution and monetization tools to ad hoc marketplaces for niche audiences. This is one of our areas of interest at Remagine Ventures.

What has changed since the start of the pandemic? How much of this growth is from the pandemic, versus overall trends that were happening already?

The pandemic changed a few things. First, Zoom and Remote Work became household words. Suddenly, consumers were homebound and the home became the office, the gym, the restaurant, the social hangout. Creators jumped at the opportunity. Media consumption grew across the board. With over three billion smartphones globally, a creator could reach a bigger audience than ever before, but it’s hard to cut through the noise. Take Twitch for example. To be on the top 8% of streamers, you only need to have five concurrent viewers.

The pandemic accelerated trends that were already in motion. Some sectors benefited more than others, like gaming, which experienced explosive growth during the pandemic, which combined with no sports on TV gave a huge boost to esports and Twitch streamers.

What types of tools for payments, marketing, and other business needs are catching on with creators now, as they branch out across platforms and become more sophisticated?

In general, the tools that get adopted are those that remove friction in creating, building an audience and helping the creator monetize. Low-code/no-code startups (like Webflow or Voiceflow) have an advantage if they’re intuitive to use. It’s a fragmented market with a lot of new tools being launched, but there’s still a huge opportunity in this space.

A lot of the tools tend to be vertically integrated within the platforms. i.e., a creator on Substack or OnlyFans most likely relies on the payment capabilities of the platform. Several tools are rising in popularity: Community management tools like Circle or Pico, website or page builders like Wix, Universe or Linktree or selling/merch platforms like Gumroad or Pop Shop.

The content creation tools I’ve tried leave a lot to be desired. Anecdotally, today I tested the Google Webstories plugin for a post I wrote on VC Cafe, and the process was slow and clunky.

What areas have matured and are less interesting to you today versus a year ago?

As a consumer, I am in awe of the creativity and talent of emerging creators. While social shopping seems to be a strong trend in 2021, I’m less interested in influencer platforms. I love podcasting as a user, but Clubhouse has almost replaced podcasts for me, at least temporarily.

What key problems remain to be solved for creator economies to truly succeed?

The key problems that remain to be solved:

Content discovery for the creation economy is still poor: Word-of-mouth remains the best discovery source, which is why you see a lot of people on social media asking for recommendations on podcasts or newsletters.

Copyright, or the lack thereof: It’s hard for creators to prevent illegal distribution of their IP. Anyone can download a TikTok video or copy it, forward a newsletter or share “exclusive” images with friends on WhatsApp.

Attention spans are getting shorter: Not every person that starts a newsletter is Ben Thompson, and not every Twitch streamer is Ninja. Few people have been able to build full “hustle economy” careers. The quality bar to cut through the noise is constantly rising.

Subscription fatigue and bundling wars: Creators, especially those in the “media” space, are competing on the consumer dollars with aggregators (like Spotify or Apple). For example, Apple fit adds new content every week and is bundling their subscription with music and storage for a low monthly fee. [This likely hurts] the individual trainer trying to go direct to the consumer.

Content moderation: Remains a challenge on open platforms like Clubhouse or Twitch. Female streamers often complain about having to deal with trolls and lack of moderation. An automated tool to help platforms clean up their content and remove abusive users could be a great help.


Josh Constine, principal, SignalFire

What are the new opportunities for creators and startups who are serving creators, within the larger landscape of the big freelance platforms today?

The big opportunity for creators and the startups that serve them is in moving fan bases off of mainstream social media platforms and onto monetization-focused properties. As we detailed in SignalFire’s Creator Economy Market Map, phase 1 was about building fan bases on major platforms like YouTube and Instagram, and phase 2 was about monetizing generic, brand-safe content through ad revenue shares and influencer marketing on those big platforms. Now phase 3 of the creator economy is about stars moving their biggest fans to subscription patronage, content sales, merchandise, meet-and-greet, and educational course platforms where they can entertain them with more niche or personalized content that earns them dollars per user rather than fractions of a cent.

What has changed since the start of the pandemic? How much of this growth is from the pandemic, versus overall trends that were happening already?

The pandemic forced creators to switch from spontaneous lifelogging with Instagram Stories to making storyboarded, “high content density” micro-entertainment with TikTok, Reels, and Snapchat Spotlight. Their lives got boring but they had plenty of time to obsessively script, reshoot, and edit videos. Audiences have lost many activities they spent their time and money on, creating a shift in attention and payments to the creator economy. New social platforms focused on concurrent, synchronous usage like Clubhouse gotten a jump start from what I call the “quarantine user loan”, and have snowballed large enough to remain vibrant and sustainable when they pay back that loan as quarantines subside.

What types of tools for payments, marketing, and other business needs are catching on with creators now, as they branch out across platforms and become more sophisticated?

Artists must become founders to win in the creator economy, our research discovered. They need to build teams of data scientists, community managers, video editors, and ecommerce experts who will become the creator economy’s middle class, and then equip them with purpose-built software from a new wave of startups like Commsor’s community management dashboard and Tradeswell’s ecommerce operating system.

Creator fintech is an especially exciting new market SignalFire is investing in to ensure artists have the working capital to produce the best content. We funded Karat, a credit card for creators that bases spending limits on follower counts and engagement metrics so they can afford video production until their revenue shares, sponsored content payments, and fan patronage earnings arrive.

What areas have matured and are less interesting to you today versus a year ago?

The concert streaming space has struggled to capitalize on the lack of IRL live music. Artists didn’t reimagine their performances, labels and managers didn’t wholeheartedly support the transition online, and platforms didn’t recreate the rowdy social atmosphere necessary to make streamed concerts addictive. But I believe there’s room for apps like Looped to pair broadcasted performances with private meet-and-greets to let musicians continue sharing their art while connecting on an intimate level with their biggest fans.