Patreon for Artists

Beforehand a small tip: when there is any kind of tool proposed to you for free, try to hack it your way and do not simply follow the suggestions.

For example, we are not using Patreon just for support but for organizing monthly art business coaching sessions.  Nobody is doing that and it allows us to be transparent on the income and to do a monthly follow up with the artist, no matter what!

Patreon for artists? What is Patreon?

The original concept

Solving an artist problem

The start-up was founded in 2013 by musician Jack Conte. He had a large fanbase but could not fully monetize his influence online. He felt if he was being underpaid for the value he brought to his community. To solve this problem, he teamed up with his college roommate and invented later what was known as Patreon.

Combination

It all started at the right time. It combined the qualities of 3 different trends and put them into one: crowdfunding, sharing economy and subscription business model. If you combine the following three things, you will get Patreon.  

What to know before starting Patreon

Funding from a Large Number

Launched in 2009, New-York based Kickstarter became trending among creators and made all sorts of creative and social projects possible. It changed the way startup projects to get funding.

Crowdfunding for creatives

Wikipedia has described crowdfunding very well: it is the practice of funding a project or venture by raising small amounts of money from a large number of people. It’s a form of alternative finance that complements traditional finance, e.g. taking a loan from financial institutions.

Donation system

When it comes to financing a venture with the help of the general public, you might think: ‘hey it’s like an IPO!’ But no. Legally speaking, crowdfunding is not (and should not be) a form of acquiring capital investment from individual investors. The money that goes into your account is considered donations for a good cause, instead of loans or equities.

Patrons, not investors

On Patreon, you can ask people for any amount of pledge from 1 USD to thousands of dollars. However, typically people don’t contribute a lot, just like crowdfunding. The idea is you need to get a lot of patrons who pledge 5-10 dollars, so you can have enough to cover your expenses. Imagine if you need $50,000 a year to run this project. How to get this money? Typically in the startup world, you get this money from one angel investor. However, with crowdfunding, you need tens of thousands of social media followings to reach your goal.

-Joaquin Phoenix

Your Art as a Share

Equity and artworks

What is Equity?

Equity can have several meanings in different context. In the startup world, equity refers to the shares that a co-founder or investor is entitled to. It is usually represented as a percentage of ownership in a company. Equity can also mean stocks or shares. Perhaps you have heard stocks more often, like the stock exchange. Stocks, shares or equity are interchangeable in this scenario. they all represent the ownership in a company.

Your way

Now you might say: Alright, I got it. I have 3 founders in my art business. I invest the most so I get 50%, the other two co-founders get 25% each. Sure, no problem! You can split the shares however you want, depending on the money, work, and IPR you invest in. You are the founders, so you can rationalise it your way.

Artwork as a Share

Now I challenge you to think about this: your artwork is a share of your art business, and your collectors are your shareholders. They spend their money investing in a piece of your art because they believe in your potential growth as a brand. What you have to do, is to maximize your shareholder value.

Shareholder value

I know it can sound very brutal and shocking. When I was in my first accounting class, my professor asked us: what is the goal of doing accounting. What is the goal of running your business? I was like: ‘Make a better world?’ She told us one version of the answer: ‘Maximizing shareholder value’. Of course, this is a free market way to understand business. It could give a bad connotation: you might be overlooking the social value you bring to society.

Issuing a share to a collector

Personally I don’t agree with this statement in business, however, I think it works in art. You are an artist, you spend time making this product that is limited and high in potential growth. It’s like if you are issuing a ‘share’ to a collector. You have the right to issue it to whoever you wish, at what price you think it’s right. By owning this piece of art, your collectors now have a stake in your business. You need to represent their interest, as well as the interest of your shareholders big or small.

Sharing economy risks

Monetization principle

An important characteristic of the sharing economy is that it enables individuals to monetize assets that are not being fully utilized. On Patreon, many artists are sharing their underutilized assets. A digital artist who creates customized brushes, templates can share them with his or her fans. Patreon made it very easy to share files, videos and other exclusive content with fans in certain tiers.

Your risks

It sounds easy because you don’t need to spend too much money or effort, however, it takes some tolerance to share your very private assets with other people. Additionally, if they abuse your assets, you are on your own. In the sharing economy, the risks are externalised.

Patreon for Artists to Get Paid Monthly

Consistency

Your fans give you little money over a long period of time. You are never secure because your supporters can cancel their subscriptions at any time. You do need to keep them happy and entertained as much as possible. Today customers are harder and harder to retain in the digital age. They can find more artists like you faster and easier than ever before. You are competing against similar artists on Patreon and outside of Patreon all the time.

Demanding

To conclude, Patreon is not for everyone. It can be right for you if you have the right qualities, skills and personalities. You need to attract a large number of audience with your art. You need to be willing to share a lot of your private assets or private life and trust your community. You need to be constantly available and entertaining your fans. If you like to be off the grid for several months, perhaps you won’t be able to retain your fans.