Searching for the Soul of the Creator Economy

A meaningful, massive opportunity is staring us right in the face at a time when the creator economy is searching for its soul.

Happy Tuesday Friends,

Let’s be honest. Very few talent and creator-led companies are solving real, meaningful problems. The vast majority of them are not very interesting or inspiring. That being said, it’s not our job to sit here and pass judgment on the very few that are brave enough to go against the status quo and pave their own path. People should build things they care about - it doesn’t matter if we care about those things or not. But, if creators started to focus on solving meaningful problems, they can help drive system-level change in many parts of society due to their reach and cultural influence.

Where’s the Soul? 🔎 

The last several years of the creator economy has been defined by a somewhat soulless approach to selling stuff. It has given the term, “influencer” or “creator” a negative connotation in the marketplace and it’s largely rooted in truth. Take a quick look at the TikTok shop and nothing more needs to be said. It has become about selling more stuff – fizzy drinks, swimsuits, snacks, and lipstick.

Finding the Soul 🫀 

Creator equity is the first step in moving away from transactional relationships towards a longer-term incentive alignment between companies and talents. When a creator has equity in a company that: 1) solves a meaningful problem the creator cares deeply about; and 2) meaningfully enhances the creator’s platform along the way, interesting things can happen.

We are not saying it’s the creators’ responsibility to solve all of the world’s problems by creating companies or joining existing companies as equity partners. We are big fans of any creator-involved business using the power of direct distribution to challenge the status quo. If that means you want to sell a sports drink, candy, or chocolate, go for it. But, do it with a level of intentionality that moves society forward in a positive direction. This can include:

• Creating more trust and transparency in the supply chain ⛓️ 

• Making things that improve human health ❤️‍🩹 

• Respecting the planet 🌐 

• Ensuring suppliers are treated fairly and earn a living wage. 👨‍🌾 

As the creator economy continues to search for its soul, a meaningful, massive opportunity is staring us right in the face. It’s the opportunity to build a network of direct distribution in a bottoms up, distributed way that can bring down ivory towers and chip away at the monopolies that currently dominate the economy. But, new creator infrastructure is required to enable the new type of distribution layer.

Building New Creator Infrastructure ⚒️ 

The creator economy is currently sitting on top of infrastructure that was largely built for the traditional media, TV, and film industries. These legacy systems are set up for serving the top 1% of talent. As the creator economy matures and competition for attention intensifies, the long tail will just get longer. This will make it harder for creators to build a sizable audience from scratch.

The current systems of support in the creator economy are not set up to service the long-tail creator. If we are going to service these smaller creators and enable direct distribution at scale, it will require a much more holistic view and set of services that goes well beyond landing endorsement deals and per-post engagements. These may include:

• 1-on-1 talent representation (not realistic, but as close we can get to this)

• Wealth management

• Mental health support

• Advisory on equity opportunities

• Product development and supply chain support with physical products

• Strategic coordination among creators that operate in similar categories

If you combine the number of eyeballs and the amount of cultural influence the creator class has, it represents the largest distribution network that has ever existed. We just have to build the infrastructure to enable this.

Now on to a piece from the CEO of Patreon on the future of the creator economy as well as a quick synopsis on the growth of celebrity liquor brands.

Death of the follower & the future of creativity on the web ☠️ 🧑‍🎨 

The founder & CEO of Patreon explained on stage at SXSW how the current internet algorithms are killing the traditional "follower" for creators and threatening their creative freedom and livelihoods.

🍿 Synopsis: The internet started as a platform that democratized creative distribution. You could upload your work to platforms like YouTube and immediately have it accessible to millions of people. After that came the "subscribe" button, which enabled creators to go beyond reach. Now they could build a following and find their true fans that would support them to build a creative business. But with the rise of platform-focused algorithms (Facebook's ranking, TikTok's "for you" curation), it has become more difficult for creators to reach their following and true fans. This shift has had a negative impact on creators' creativity and ability to support themselves doing what they love. He advocates for new spaces on the internet (like Patreon) where creators create what they want, maintain a direc relationship with their communities, and control their own destinies.

📚 Conclusion: It has become harder than ever for creators to establish and maintain relationships with their fans. Creators are increasingly losing control over the distribution of their work. Many feel they must chase ever-changing platform algorithms rather than focusing on what truly inspires them. This not only makes it difficult to reach audiences and earn a living, but also compromises artists' creative freedom and integrity. This shows the need for new infrastructure to help creators establish, maintain, and deepen the direct relationship with their most dedicated supporters. The most successful creators going forward will be those who take a more holistic approach to engage and energize their most loyal fans.

👀 Learn More: check out the full keynote here:

Respectfully, we don’t need another celebrity-liquor brand 🥃 ❌ 

There were less than 40 celebrity liquor brands in 2018. Today there are over 500…

🍿 Synopsis: What do George Clooney, Jay-Z, and Conor McGregor all have in common? Widespread influence and fame of course. But, the real connection is that they have all generated their true wealth from selling alcohol. George Clooney sold his tequila brand Casamigos to Diageo for $1 billion only four years after launching. Jay-Z sold his stake in cognac brand D’ussé to Bacardi for a whopping $750 million. Conor McGregor sold his stake in the whiskey brand Proper No. Twelve to Proximo Spirits for $600 million only three years after founding it. And there are about 600 other celebrities currently looking to achieve similar success.

📚 Conclusion: While George Clooney, Jay-Z, and Conor McGregor all have some level of exceptional talent that propelled them to stardom, it was attaching their personal brands to liquor that made them generational wealth. And they won’t be the last to do so. Celebrities seek to align themselves with high-end products that represent quality, style, and sophistication. Premium spirits tick all of the boxes as fans will simply select celebrity brands over the competition. But, the real question is, do we need more celebrity liquor brands making sub-par products? The space has become so crowded we believe the outcomes related to celebrity spirits will start to dwindle. That’s not a bad thing. What if these celebrities choose to use their platforms to promote companies solving real, meaningful problems?

👀 Learn More: check out this article explaining the negative effects celebrity tequila brands pumping out subpar products are having on Mexican agave:

Have a great week and remember to Go Direct!

Build with love,

Jordan & Scott