Small creators are big business

You’ve likely heard of the “creator economy” already — it’s no longer a new concept, although some people are more acquainted with what it entails than others. But the creator economy needs creators. It says so right there on the label.

Essentially, what we call the creator economy encompasses two groups. The first is a large, decentralized and amorphous group of predominantly independent creatives connected to the digital sphere in one way or another. This includes musicians, visual artists, filmmakers, graphic designers, bloggers and influencers. The second is the companies and platforms that provide the tools that enable this creation, and, by extension, distribution and monetization.

Unsurprisingly, the creator economy’s business side is fundamentally digital, and thus the domain of the tech industry. This has made it easier than ever for independent creators to make a living through their work.

It has also, rather remarkably, kick-started the long overdue unraveling of the superstar model — the old-school way of doing entertainment business in which a small cohort of famous stars made content for everyone, and that was it. That’s not to say subcultures haven’t flourished for decades — they have — but they’ve never made the bulk of the cash.

The creator economy and creator tech sprung up relatively organically. The shift was initially enabled by virality and audience access through newfangled social media channels, but creator tech is now a world unto itself. As such, its very survival depends on the continuation of this slide away from the superstar model.

Kicking holes into the superstar model

In a July 16 letter to shareholders, Netflix acknowledged TikTok as a real competitor, going so far as to note its “astounding” growth. One could even argue that Netflix’s initial begrudging acknowledgment of TikTok’s competitive edge happened last year when the platform launched Fast Laughs, a copycat video feed with short clips culled from its comedy catalog.

Regardless, Netflix has long hitched its wagon to superstars: Zac Efron travels the globe, Paris Hilton cooks, every household-name comedian has at least one special, and original movies and series net the likes of Timothée Chalamet, Jane Fonda, Sandra Oh and Anthony Hopkins, to name but a few. It’s the old guard.

Meanwhile, the biggest stars on TikTok are not “stars” at all, but regular people who happened to be funny or clever or incisive and garnered an audience based on the luck of the algorithm and their creativity alone. They’re not names everyone knows, but many creators have found their niche and a dedicated following. They’re the new guard, and they’re siphoning off precious attention and viewership.

There are no “tentpoles” in the creator economy, a term used to describe a given studio’s big-budget blockbuster that does so well it secures the financial health of the studio itself. This also applies to major labels: Most albums hardly recoup the costs required to make them, but then Adele comes along, drops a record, and pays for all those records that didn’t recoup and then some.

Not so in the creator economy. Yes, TikTok has minted its own type of stars like Khaby Lame, whose hilarious exasperation at overcomplicated life hacks catapulted him to global fame — he’s now shilling for Meta.

But people who follow Khaby Lame don’t open the app, watch his latest video, then close it. (The algorithm is specifically designed so you don’t do this, but that’s a different story.) They also follow any number of smaller creators in addition to those stars, and the majority of the videos they watch are just statistically bound to be made by creators who are not internationally famous.

Smaller creators finding niche success and devoted audiences are changing everything, and creator tech is rising to meet their needs in real time. This is where creator welfare comes in — and why sustaining it must be paramount.

Good ethics = good business

It’s easy to frame the creator payment question as a purely ethical one. But that’s a well-trod argument. Obviously, artists should be paid well for their work. So let’s look at it a different way.

For creator economy tech platforms, fair compensation for smaller creators must be the heart of our business models. Doing so is crucial to our sustainability as platforms and companies. It shores up demand for our platforms by drawing creators to our platforms and retaining them.

It’s also realistic. It’s not the ’90s, and there are no tentpoles in this game. Creator tech needs creator numbers. Large numbers of small creators form the very demand that creator tech relies on.

Creator tech must go all-in on supporting smaller creators. Without supporting small creators and fair payouts, and without continually improving platforms that connect creators to sponsorship and patronage opportunities, all the progress made against the superstar model will be for naught. Creator tech will shoot itself in the foot.

Business plans in which shareholders reap returns that dwarf those of the creators themselves are neither admirable nor sustainable, particularly in a climate with so much audience demand and willingness to pay. Algorithms that punish content creators for taking a day off are ridiculous and need to go. It’s high time for an overhaul of these models and the companies that use them.

Creator tech should continue to embrace and innovate on modern patronage. Creator tech is already fostering a competitive market of patron platforms that cater to specific creators’ needs and, in certain cases, connect brands with creators for profitable partnerships.

Substack is changing the game for freelance writers. Patreon bills itself as ideal for creators of all types, but it’s the unofficial go-to for podcasters. The platforms offering the most — the most money, the most visibility, the most opportunities, the most accessibility — will win.

Continued innovation in terms of licensing, distribution and blockchain certification is as good for artist welfare as it will be for the companies that enable these innovations. How can art auction platforms migrate beyond the legacy galleries and toward the people? Digital music, footage and image licensing is only accelerating and represents an important link within the creator economy among, for instance, video content creators, photographers and songwriters.

In colder terms, there’s money to be made, and no one has to be exploited in the process.

Investing in smaller creators is good for the economic gander

In the age of the individual creator, creator tech’s responsibility to the creators themselves is as much an ethical position as it is one of self-preservation. (No creator tech without a full thriving ecosystem of smaller creators, to err on the side of the obvious.) The superstar economy is ceding ground to independent creators with dedicated followings scattered across platforms and mediums.

If the creator economy is to thrive, the creators must thrive first. Patrons must come from unexpected places and the bottom up. Audiences must be easier to access. Creator tech can’t take the lion’s share and leave pennies for the creators. In other words, creator tech’s success is inextricable from creator success.

Tech has a bad habit of thinking its fate isn’t tied up with that of its users. From a purely business standpoint, creator tech shouldn’t make this mistake. From an ethical one, it will be glad it didn’t.