NAB
The Renaissance was the zenith of human creative output. Are
we really entering a second Renaissance where innovations are once again
profoundly reshaping society and culture?
That’s what VC firm Index Ventures thinks, at least in its
marketing for the “Index Creator Summit,” a day-long conference to which it has
invited a number of entrepreneurs from start-ups that Index has invested in.
To be fair, the list is pretty extraordinary and includes
the CEOs of Discord, Patreon, Figma and OpenSea.
So, let’s hear the Index argument that we are now in a
digital Renaissance. In essence, software is making it easy for anyone to
create; internet platforms are opening the floodgates of distribution; and
cultural and generational shifts are reworking the economic relationship
between creator and patron.
“What’s striking about the creator phenomenon is that it
isn’t a vertical trend; rather, it’s a through-line that cuts across social,
gaming, crypto, media, commerce,” blogs Rex Woodbury, a principal at the
VC firm.
“It is both the future of work, with creators forming a new
class of digitally-native entrepreneurs, and the future of leisure. And while
the creator phenomenon is often thought of as a consumer trend, it encompasses
both enterprise and consumer.”
He explains that Index we think of the creator economy in
three parts: creation tools; distribution; and monetization. In other words:
how creators make stuff, how creators reach an audience, and how creators get
paid.
“The first piece of the puzzle is democratizing creation
itself,” he says. “The best tools broaden the scope of who can be a creator…
unlock new levels of self-expression.”
Examples include: Figma and Canva for design; Kapwing and
Veed for video; Descript and Splice for audio; and Unity and Unreal Engine for
gaming. Elegant, design-first tools
The internet unlocks distribution. “Traditionally,
gatekeepers dictated who had influence: record labels, newspaper editors,
studio executives. Now anyone can build an online community. On the internet,
nothing is too niche; there are communities for everything and everyone.”
The final and most recent piece of the creator economy
identified by Woodbury is monetization. It’s not easy being a creator. One
study found that reaching the top 3.5% of YouTube channels — which means about
1 million views each month — only nets you $12,000 to $16,000 a year, around
the federal poverty line.
Woodbury, however, points to creators who have innovated a
way around this situation. A headline speaker at the Summit is Jack Conte,
one-time musician and founder of Patreon, an online site billed as making it
easier for creators to get paid (though it still charges a commission of five
to 12 percent of creators’ monthly income, in addition to payment processing
fees).
The rise of crypto means that a creator can sell digital
goods on OpenSea, or display them on Showtime, Woodbury thinks. Innovations
like non-fungible tokens, social tokens, and decentralized autonomous
organizations (DAOs) will further push forward the monetization layer of this
new economy.
“The creator economy is accelerating, propelled by both the
shock of the COVID-19 pandemic and the coming-of-age of Gen Z. Being a creator
is about flexibility, self-expression, and financial upside. It’s about
side-stepping the gatekeepers who have historically captured value and moved
culture. It’s a new form of entrepreneurship, one built for the digital species
we are becoming.”
Whether what it creates and what it influences is on the
scale of that of Da Vinci and Michelangelo 15th and 16th century perhaps only
time will tell.
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