As you will probably know if you run into this post: Patreon has decided to change its business model and charge a Creator's Patrons the fees that said Creator was paying before. There's a massive uproar on Twitter, the Patreon Facebook page I'm on has gone strangely silent, and there are people who have lost their entire livelihoods in a couple of days.
A little about me for context's sake: I'm Belgian. I had to legally register as a company to even get to use Patreon; thankfully, Belgian laws are such that I paid nothing, and am paying nothing because my business is artistic and I'm not earning enough through it. As a Belgian, I pay 21% VAT; so a pledge of $1 made to someone else comes down to $1.21 for me. My four Patrons were friends and family based in Europe, so all had VAT (three of them at 21%), plus conversion fees - better for them, worse for me. But I had hopes and plans. And I still do.
If you haven't read the articles/essays/Twitter/Patreon blogs, here are the highlights - as I understand them, of course.
1. Creators will now take a whopping 95% earnings home, and fees they were previously charged are shifted onto Patrons. 2.9% + 0.35 cents will be applied.
It may not seem like much, until you get to the point where this will be applied per pledge; so if you're pledging to several Creators at once, you will be charged these fees for every single transaction.
A simple example: the one $1 pledge I had would now come to at least $1.60, while the Creator takes home 0.95 cents. Needless to say, I'll be supporting this artist through other means.
2. It has been said major research and experimenting has been done with Patrons and Creators to figure out this new business model, in their own blog. Fact: there are big players who openly said they never heard about any of this before it hit everyone - now, less than two weeks before changes will take effect (18 Dec). There are people whose livelihoods were destroyed, as people refuse to pay the extra fees. With the $1.60 I was facing for a $1 pledge, I can understand how they feel. And I had only one pledge to another Creator.
Now, the logic behind this change has been extensively debated wherever I've looked. On the one hand, people see it as a cash grab; on the other hand, it is logically explained through a change Patreon has been trying to implement for quite some time now: charge up front.
Charge up front is a beta option allowing you to, as the name suggests, charge new Patrons up front - a change requested by Creators due to what I'll call 'pledge ninjas': they come in, select a pledge level, download everything they want, and delete their pledge - effectively obtaining all content without paying a dime. the artist I was pledging to had it happen to him despite his work being early access, meaning it becomes available anyway to the public after a short while. So charge up front was the response, but it created another issue: people pledging at the end of the month, and being charged again at the beginning of the month, with the Creator feeling required to give a refund.
To fix this issue, they are now planning to have Patrons pay on the anniversary date of their subscription - meaning de-aggregated pledges, and thus more fees as every transaction becomes its own transaction, and no longer a bundled transaction as it is now. I have read so many Tweets of Creators wanting to keep this system that I truly do wonder who, exactly, their test subjects were for this change.
Which does give more credit to the thought Patreon changes its policy to gain more money. With its CEO having been contacted by phone by some Creators, I'll give him the benefit of the doubt for now. As someone rightly said: you can hate a company, and still respect an individual - be they the head of the company. One Creator quoted the CEO as saying, 'we fucked up the roll-out'.
3. 'We fucked up the roll-out'. I, as many others, understand this as meaning they don't regret the changes they've implemented, despite the uproar, despite people losing their livelihoods. So, one can logically come to think it means the changes are necessary for the platform to keep existing, as I've seen some people say. Honestly, I don't know what marketing idiot would think it a great idea to roll out such a major change while warning people two weeks in advance, and during one of the busiest months of the year. I'm not marketing savvy and even I know this, in itself, is a major fuck-up. Which gives more credibility to Patreon not being there for profit, but being people who had an idea and tried their best to implement it and realize, sometime down the road, that it's not working well. With their reputation broken and people losing faith in them, I'm not sure how they'll be able to 'un-fuck' the roll-out.
But this is a painful reminder that nothing in this world is acquired. We are all at the mercy of changes such as these, and it is such a classic economic fail I've seen my own government do it. Need money => create more taxes => people buy less, so less profit! Perhaps the Patrons who stay will make up for those who leave.
My take on it is: let's wait until January 18th and every Patron finally knows how much extra they'll be paying. I predict more losses. I hope to be proven wrong.
4. There will 'likely' be changes as to how Creators can pay other Creators, namely in becoming unable to use their earnings to pay them - resulting in yet more fees. This is taken directly from the Patreon Community forums.
The last lines are self-explanatory. I have no idea what they mean by 'edge cases' or 'complexity to the payment system'; all I know is: extra Paypal fees.
5. 'We'd rather have our GMV (=gross merchandise volume) be made up of fewer, but truly life-changed creators rather than a lot of creators making a few dollars.'
Which basically means: small-time Creators are unwelcome in our new business model. The entire essay can be read here. I'll admit, I didn't understand all of it. So my attention rather went to the explanations of the Patreon staffer Raviv, who this statement belongs to.
The debate I've seen going on Twitter is: what does 'truly life-changed' mean? According to the article,
Patreon's understanding of 'life-changed' is a specific, undisclosed number. To Creators whose life changed thanks to Patreon, this number relates to the fact whether they can buy groceries, pay bills, and even the rent if they're lucky. My life would already be changed with 400 to 500 € a month. I don't need a thousand or more: just enough to get food on the table and feel like I succeeded at the only job I'm able to do, and that is writing. Job opportunities are scarce here for 'unqualified' people (=people without a bachelor degree or experience in the branch they're applying for). With being trilingual, gifted with words (less so when I don't edit myself), capable to draw, to think, with a high desire to help others and fierce loyalty when I'm given a chance, all I get to hope for is working in retail because that's where my experience lies. And the cruel reality is: I hate retail; I love numbers, but I hate statistics, targets, forcing people to buy stuff they don't need and sometimes don't want. I hate retail. I broke my health working my last retail job at a supermarket. And I still have a bruise on my leg after two years. Every day, I am visibly reminded of how much I hate retail. So earning even €400 would be life-changing, because that'd mean not having to go back down that road.
But clearly this is not the sort of life-changing we are talking about. No one knows exactly what they mean. I'd love to know their definition of it.
Even if it makes sense from a business point of view; well, hey, those current 'life-changed' Creators started out small, themselves. They got there through their own dedication, their own hard work - Patreon is but an intermediary between fans and Creators. Patreon did not make them big - those people did it on their own.
6. Which leads me to their beloved Twitter catch-phrase 'We're getting artists paid'. I believe 'certain artists' would be more fair. Patreon has showcased itself as the place to be as Creator to earn a living; it's true that the big Creators on there somehow made it look easy - I, too, joined in the hopes of reaching these heights, and was sorely disappointed when I realized Patreon isn't the place to grow a following, that this had to be done off-site. So, I put the work in - perhaps not as much as I could've/should've, but I tried. Regular free updates, monthly story bundles, extra stories, Twitter, Facebook, I did what I could. And still would have, until I discovered I'm not the market they're catering to - anymore.
Here's the reality: with a push and a shove from higher up, people can get chances they'd never have gotten otherwise. Instead of breaking the little Creators, Patreon could and SHOULD have set in place a system that showcases the 'upcoming' Creators - small people like me who put in the work, do regular updates, try their hardest to get noticed. When you do regular updates for 8 months (beginning to end), chances are you're here to stay and trudge through the desert to reach that oasis.
And this could have resulted in more 'big' Creators, more fitting into that GMV. In the end, they were eitehr a beautiful dream, or charming hypocrites. Or a little bit of both.
And that's all I wanted to say. In the meantime I've moved over to a donations site instead, Liberapay, and set up a Ko-Fi. I've asked my four Patrons to delete their pledges, I will be deleting my one pledge soon, and my page as well. I don't know what the future will hold. What I do know is that I won't have to watch my precious Patrons be hit with extra charges just to show their support.
And at the same time, I realized how little of my heart's goal I got done through Patreon and, let's face it, its paywall. I was so focused every month on getting things done for my Patrons that I failed on my goal to be read and enjoyed. Hence why I moved to a donations site. Plus, I like how they're set up, so we'll see what comes of it.
Now it's time to pull up them sleeves and make work again of everything I set out to do. 2018 will be good. But my heart goes out to everyone whose future is now uncertain because of Patreon's 'fuck-up'.
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