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Patreon -Company Research Report

About Company

Patreon is a US-based affiliation platform offering commercial widgets that content generators can utilize for operating a subscription service. Patreon assists performers and innovators to make an earning every month through extending perquisites and awards to the subscribers.  

The company asks for a charge of 5%-12% of the innovator’s earnings every month, over and above disbursement processing costs.

The company enables performers to obtain sponsorship straightaway from their followers or supporters repetitively or on each objet d’art. Patreon, founded on 2nd May 2013 by software developer Sam Yam and instrumentalist Jack Conte, is headquartered in San Francisco, California.

How it all began for Patreon

In 2013, Jack Conte, a YouTuber and instrumentalist, was in search of a solution for his dilemma: countless viewers admired his video content but just a minuscule amount was being credited to his account. This was not making sense. Therefore, he chalked out a strategy regarding a website that would enable his supporters to make direct subscriptions to him for the worth he was providing to them. 

He fetched that scribble to Sam Yam, his roomie in college (presently the co-founder of the company) who switched that scribble into wholly operational service in just one and half months.  

Since then, eight years have passed, and Patreon has turned into a one-stop solution for this similar issue for more than 200,000 originators backed by over six million sponsors, and originators have grossed more than $2 billion.

Current Scenario

Patreon boosts affiliation trades for originators by providing them the widgets they require for obtaining, handling, and motivating their subscribing sponsors. With a contribution-pattern disbursal prototype, supporters extend their preferred originators a monthly sum of their discretion in return for free accessibility, additional content, or a more intimate glance into their innovative voyage.

This prototype creates a win-win situation; originators maintain innovative liberty at the time of receiving the wage they justify, and supporters have the chance of relaxing, understanding that their subscription moves straight in the direction of generating further of what they prefer.

Business prototype of Patreon

The subscribers of Patreon are categorized according to the kind of content like the podcast, movies/videos, cartoons, humor, academics, and gaming.

These content generators make a page on the official site of Patreon, where supporters can opt to give a certain sum to an originator every month.

Instead, content generators can arrange their pages to ensure that sponsors make a payment whenever the creative person brings out a fresh work of art. An originator usually exhibits a target that the continuing income will move in the direction of, and has the liberty to fix the highest cap of the amount he can obtain each month. The sponsors can revoke their disbursal whenever they wish. Originators essentially offer membership paybacks (usually as free content or under-the-table job) for their supporters, contingent upon the sum paid by each sponsor.

The sponsors have the option to unlock financial layers that grow the content variety they visualize from the subscriber. Various content generators on Patreon are YouTubers as well. They have the skillset to generate content on various platforms. Though the videos on YouTube might be accessible to the common people, the sponsors get special content created particularly for them in place of supporting the Patreon subscriber’s target. Patreon charges a 5% fee on subscriptions. As of 2017 May, the mean subscription per sponsor was approximately $12, and a fresh sponsor subscribed to an originator per 5.5 seconds.

As of 2014 February, around half of the artists on Patreon generate YouTube videos, though the majority of the remaining are authors, webcomics performers, podcasters, and instrumentalists. As of 2016 December, the Community Roadmaps of the organization permit nakedness and indicative images provided that they are distinctly labeled, but ban content that might be considered adult or as extolling erotic vehemence.

Different from a plethora of other online platforms like Facebook and YouTube that utilize conditioned algorithms for recognizing possibly unsuitable content, the loyalty and security group of Patreon tracks subscribers and probes grievances of Terms of Service infringements.

Who are the beneficiaries of Patreon?

The beneficiaries of Patreon are the following:

  • Video Makers 
  • Podcasters
  • Visual Artists
  • Instrumentalists 
  • Communities
  • Authors & Reporters 
  • Non-profit organizations
  • Gaming Originators 
  • Regional Businesses
  • Academics and Lectures
  • Creators-of-all-types 

Modifications in content rules and terms of service

In 2017 December, Patreon declared about a service charge commencing on 18 December 2017, where certain charges would be payable by the sponsors instead of overall charges being borne by the originator. This resulted in a repercussion from various originators, comprising a few who witnessed affiliates of their supporter base pull out modest subscriptions as a reaction. According to the new disbursal framework, a 1 dollar subscription would have incurred a sponsor $1.38, and a five-dollar subscription would have incurred $5.50, symbolizing a 38% and 10% hike correspondingly. Because of this criticism and the departure of multiple subscriptions for originators, Patreon publicized that it wouldn’t be introducing these modifications, and said sorry to their subscribers.

In 2018, there were allegations against Patreon of suppressing autonomous sensory meridian response or ASMR videos.

On 24th October 2020, Patreon proclaimed that it would prohibit every account that promotes propaganda encouraging the QAnon collusion scheme.

Concerning porn content

In March 2014, Patreon announced through an email that originators of erotic content on its platform would not be permitted to utilize PayPal facilities via Patreon anymore to realize subscription disbursals. In 2016 July, Patreon sent another email to the content originators declaring that disbursements via PayPal would commence for porn-based originators. Those who functioned inside the “Not Safe For Work” groups on Patreon were permitted to acknowledge disbursements via PayPal through Braintree, the subordinate company of PayPal. Nonetheless, in 2017 October, the company retroverted its stand on Not Safe For Work content, rolling out fresh curbs. They brought out an elaborate edition of the community regulations with a wider explanation of adult content, setting off a repercussion from a few sexual content generators. 

A plea in objection to the modifications collected one thousand eight hundred signs, which attracted a reply from co-founder Jack Conte.

In 2018 June, Patreon commenced prohibiting certain originators who created pornographic content.

Who are the users of Patreon?

Given below are the people who use Patreon frequently: 

  • Webcomic performers 
  • YouTube videographers 
  • Podcasters 
  • Authors 
  • Adult content originators
  • Instrumentalists 
  • And other types of originators who make regular online posts.

Who are the founders of Patreon? 

Patreon was established by Sam Yam and Jack Conte, a US-based composer-vocalist, multi-musician, and businessperson.

How many users are there?

Patreon features around six million active subscribers every month.

How many creators are there on Patreon?

Currently, there are more than 200,000 content creators on this user-friendly platform.

How much have the content creators earned from Patreon?

To date, the content creators have earned more than 2 billion US dollars from Patreon. 

Products of Patreon  

Patreon offers the following products to the consumers:

1) Pro

This product features all-inclusive tools to develop and expand a flourishing affiliation trade.

2) Lite 

Basic tools to establish recurring endorsement from your supporters.

3) Premium

For well-known originators and innovative commercial enterprises.

The Viewpoint

Patreon takes pride and encouragement that content creators depend on it for a regular source of income. Furthermore, they enjoy their liberty of innovation on this platform. Patreon sincerely ensures that its responsibility is met and takes every possible step to achieve the goals collectively. 

Disclaimer: This article is an educational purpose submission for benefiting students and corporate sector employees. It is highly recommended that you don’t take it as a piece of investment advice. It is always logical to discuss with your investment advisor when it comes to making any form of investment.

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Kiara Dawson
Kiara Dawson comes from an Engineering background, with a specialization in Information Technology. She has a keen interest and expertise in Web Development, Data Analytics, and Research. She trusts in the process of growth through knowledge and hard work.

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