Patreon is a subscription-based crowdfunding site where individuals can donate to their favorite content creators (artists, writers, videographers, musicians, and so many more) on a set schedule, encouraging and promoting their work. For many small-time creators this means they can be supported without resorting to online advertisements or shady deals with product manufacturers. For most, a $1 per month donation is a big deal – it means their efforts are appreciated, and that they should continue. Enough $1 donations makes for a lot of encouragement.
Nobody is getting rich off of Patreon – they disclosed statistics a few months ago and for the vast majority (>90% of creators), even breaking $5,000 per year in donations is a pipe dream. Realistically, it’s a supplemental income, something that provides much-needed breathing room and encouragement for those trying to find their voice, or even their audience.
Last week Patreon rolled out new terms for how creators would receive funding and how much patrons would be charged. This caught many people off-guard, including several members of their executive board, who had not been informed of the changes. With many crying foul, I wanted to break down the changes as simply as possible from both sides of the fence.
A patron supports 5 creators. On average they give $2 a month to each, but sometimes one creates a lot of content and so gets more.
Patreon would calculate how much was owed, based on current pledges, and withdraw that amount +$0.35 for credit card processing. Each individual creator’s contribution would be reduced by Patreon’s cut and a small credit card charge (~2%). This means the amount a creator would get could differ from month to month, and range from 80% to 95% of pledged donations.
This means our sample patron would be charged ~$10.35 each month, pretty close to the pledged $10.
Patreon wanted to make things smoother for the content creators, and so pledged that creators would get a flat 95% of all pledges. That’s great! Unfortunately, credit card charges and fees have to come from somewhere. If they’re not coming from the amount sent to the creators, they have to come from the patrons themselves.
They changed their terms to have each individual transaction charged the full credit card processing fee, before Patreon takes their 5%, even though the patron is just billed in a lump sum. What’s more, if a patron is contributing multiple times per month, each individual transaction is so charged, instead of the month-end lump sum as before.
Our sample Patron would now be charged ($2+$0.35+2%) x5 = at least $12 per month. This may not seem like a large increase, but it actively discourages people from contributing a little bit to many creators. I myself support almost a dozen different people, and this change increases my monthly charge by $5, even before we get to the credit card percentage or per-transaction fee.
For many, this is the difference between being able to support creators and not. It is largely a positive change for creators, who can budget and plan for a specific amount of supplementary income, but already many have seen patrons cancel support in droves, all citing this change (and in my mind, rightly so).
I spent a fair amount of time this weekend looking for and researching Patreon alternatives, many of whom are actively promoting their services in the wake of this week’s savage backlash. I still haven’t found one I’m completely comfortable with, but have high hopes for several of the invite-only services that will be leaving beta soon.
In addition there are one-time contribution services like PayPal (which has its own problems) and others which encourage people to buy their favorite creators a “cup of coffee” or similar with standardized $5 donations. As more information becomes available I’ll be looking at those as well.
I’m exceptionally fortunate in that my job affords me the ability to contribute to my favorite content creators without sweating a few extra dollars per month, but I know not everyone has that luxury, and that I may not always have it either.
This means that while I’m going to continue supporting the creators I can, via whichever means they prefer, the very likely future is that I’ll shut down my personal Patreon page and find a different way for supporters to do so.
Quoth the founder of Patreon this weekend on a conference call with the board, “we absolutely f—-d up that rollout.”
Yes Jack, you really did. I genuinely hope that Patreon, and other like services, will listen to the overwhelming user feedback and both correct this terrible change but also prove to be more transparent regarding fees, charged, and plans for the future.
Edit: there’s a great Twitter thread which starts here for those interested in a more nuanced take.