
Patreon CEO says the company's generous business model is not sustainable - PretzelFisch
https://www.cnbc.com/2019/01/23/crowd-funding-platform-patreon-announces-it-will-pay-out-half-a-billion-dollars-to-content-creators-in-2019.html
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sbr464
I’m curious what isn’t sustainable, since it doesn’t go into detail in the
article.

If using stripe (or similar), all payment backend/scalability is included in
the processing fees. And that portion is covered by the additional 5% fee
Patreon charges directly.

5% of 500 million = $25 million USD.

\+ 10 million USD extra since the actual processing fees are typically 3% or
less in cost.

That leaves ~$35 million USD to cover:

\- support staff \- ethics staff (mentioned was important) \- ops/accounting
staff \- developers \- designers \- legal/insurance \- office space/expenses
\- marketing \- hosting, transactional email expenses \- r&d

Most videos/content are using YouTube still from what I’ve seen, that would
help avoid a large bandwidth bill.

It’s not a large company for sure, but do content providers really want a
large, for-profit entity with ever increasing revenue needs in between them
and their subscribers?

I’m curious what the unsustainable bit is when the above is considered.

~~~
bartwe
Not making enough for the level of investment taken ?

