The History of The Creator Economy: How To Build A Business Around What You Make
The Creator Economy is the new economic model that affords everyone the chance at a creative career. But what is it, and where did it come from?
Amongst the buzziest of buzzwords you'll hear around the internet, right up there with cryptofascism and FUCKING WORDLE, is 'The Creator Economy.' But what is it? Well, since we're building a whole podcast/YouTube empire/website around it, we thought it might be an idea to wrangle together some kind of idiot's guide to the whole thing. To avoid doubt, we're the idiots. I was going to call it a 'brief history of the creator economy' but then I wrote 3000 words on it, so that felt like a bit of a con. Strap in!
So, what is the creator economy? Well, loosely speaking, it's the new economic model that encourages the production of goods and services by independent creators, who no longer need to rely on traditional delivery methods and infrastructures to do so. Put simply, it's making stuff and selling it yourself, a bit like when you used to go to your local village fete and buy a pottery donkey that looked more like a distressed thumb, except now you're buying it online, and because you actually want to, not because the old lady who smells of patchouli and regret makes you feel sad.
It's a world in which artists have the power to determine the course of their own careers and businesses can be founded based on creativity alone. The model is based on the belief that creators are best able to create things they find interesting and fulfilling, rather than filtering that creativity through gatekeepers and traditional power structures. The same model says that we as consumers no longer need for the grand institutions of old to tell us what we might like, and that word of mouth (and weird algorithms dreamed up by strange android people) can point us to find the work of the creators who'll fit our tastes.
In 1997, Paul Saffo coined the term "creator economy" to describe a new era of commerce where creators could make money from their work using digital tools and the internet. At the time, this was only possible through niche websites or by uploading content to early online communities, but for me, the roots of the creator economy go back far further than that, to a little band I like to call Buzzcocks. I call them that because that's their name.
The creator economy starts with a Spiral Scratch
Back before punk was even a thing, a young band from Bolton in the north of England was trying to get a break. Like for every creative since the dawn of time, this was a frustrating experience. Despite their growing audience and clear talent, the record labels were having none of it. So they borrowed £500 from their friends and families to pay for the record's production and manufacture and released an EP called Spiral Scratch in January 1977, calling their 'label' New Hormones.
This made Buzzcocks the first English punk group to establish an independent record label. The disc quickly sold out its initial run of 1000 copies and went on to sell 15,000 more, initially by mail order, but also with the help of the Manchester branch of the music chain store Virgin, whose manager took some copies and persuaded other regional branch managers to follow suit. Well done, that man. And so was born the DIY ethos, which some would argue is the true essence of punk rock.
The DIY punk scene, spearheaded by the likes of Fugazi and Black Flag in the 1980s, picked up on that ethos and ran with it. They helped pave the way for the creator economy by instilling creatives with the freedom to do away with gatekeepers. Who needs a record executive with shoulder pads and a propensity for cocaine abuse when you can screen print your own t-shirts, fund your own small run of vinyl, and get a photocopy of contacts from friendly venues across the country from someone else in another band?
But while being in a band offered a range of ways to keep your creativity going, with live touring, merchandise, and self-funded distribution, it was a lot harder for other creatives to follow this step, with attempts to go DIY within the publishing industry, for instance, roundly derided under terms like ‘vanity publishing.’ That all changed with the introduction of the Kindle.
Ebooks, a digital publishing revolution
The first ebook was published in 1997, and since then the format has grown in popularity. By 2009, there were over one million ebooks available for sale on Amazon.com, and in 2022, that number is nearer fifty million. The ebook market continues to explode, with new publishers and authors creating books in this format, driven by a new movement of self-published, or indie, authors.
When Amazon first launched the Kindle, they wanted to make sure there was plenty of content for their new flagship product, but given their at-best dicey relationship with the big publishing companies, they opted to have their own in-house author ecosystem, KDP (Kindle Direct Publishing), which launched in 2007. Now any author could take the book that had been languishing, unloved, in their rejection pile, slap a cover on it, and get it out into the world. Over the course of fifteen years, this new 'indie' publishing world has pushed into global markets, across multiple stores, with indie authors selling millions of books per year.
There are hundreds of success stories across the indie author market, but none so stark as The Martian, an indie published ebook that went all the way to Hollywood. Incidentally, if anyone from Hollywood is reading this, my Blood on the Motorway series would make an excellent film or tv series. Ahem.
The Four Hour Work Week
In 2009, Tim Ferriss wrote The 4-Hour Work Week, which further popularised the idea of the creator economy and put the term into the mainstream. The book posits anyone can create their own success by working fewer hours than they traditionally would. Ferriss' book outlined a method for achieving this goal, which involved using technology and automation to reduce work hours. By doing so, individuals could free up time to focus on their passions and goals outside of work.
Since its publication, the creator economy has continued to grow in popularity, with businesses and individuals alike recognising its potential to change the way we live and work. Ferriss's ideas have continued to be popular over the years. Today, many people are working less and living better because of it, and The Four Hour Work Week is one of the most popular books on personal finance ever written. Personally, I work every single hour I can, because writing words is hard, and sometimes in four hours it feels like I've indulged in some Sisyphean triumph, and it turns out I've only written 200 words of pure bilge.
How crowdfunding is changing the way we create
From Etsy to Kickstarter, crowdfunding is changing the way we create. Back in 2009, Etsy was one of the first platforms to allow people to sell handmade goods online. Today, it’s one of the most popular platforms for crafting enthusiasts around the world, allowing the creation of non-digital products to be distributed with the same ease as digital ones in the online marketplace, and with an aesthetic that actively drives customers to creatives. Or it was, until they decided to shoot themselves in the face by raising their fees by 30%.
Kickstarter has become a popular way for people to raise money for their creative projects. Launched in 2009 by two friends who wanted to create a platform where artsy people could share their projects with the world, Kickstarter has helped bring thousands of creative products to life. From art books and films to fashion lines and technology innovations, Kickstarter has been a major player in helping creators get their ideas off the ground.
The most extreme success on Kickstarter came this year when Brandon Sanderson essentially broke the entire publishing industry in half like he'd cleaved it with a magical sword. The fantasy and sci-fi author's project to publish four secret novels raised $20.3 million in just three days, more than the Pebble Time smartwatch raised in 2015. After 30 days, Sanderson's campaign ended on an eye-watering $41,754,153.
Sanderson plans to release all four books in 2023, at which point he will make even more money. Three of the books are set in his Cosmere universe, making them essential to his many rabid fans. His backers will receive them as e-books, audiobooks or physical editions based on their level of backing, while the campaign rewards include eight boxes of swag that backers will receive throughout the year.
To celebrate his success, Sanderson and his team backed all the literary projects on Kickstarter that weren't deemed too unsafe for work and don't break the platform's terms of service. And if you're think I'm not bitter about not having a book project on Kickstarter when he did that, then you think on. I'm very, very, very bitter about it. Ahem. As noted by The Mary Sue, Sanderson donated to over 300 projects altogether and highlighted some of them in a video so as to direct some more backers their way. Like I say, I'm definitely not bitter about that.
As well as Kickstarter, Patreon offers a way to monetise your audience, no matter what the creative outlet. Podcasters, bloggers, YouTubers, streaming gamers, and basically creatives of all stripes can now offer a way to support them in exchange for exclusive extras, although comedy legend Alexei Sayle probably has the best idea, offering nothing for any tier of support beyond the show itself:
"If you chip in all this can continue (though it’ll probably continue anyway). However if we get more in than our costs I promise I’ll donate the excess to some doomed extreme far left cause. To aid fundraising I’ve created three categories of giving: Silver Membership - £2 a month. If you give £2 a month you will get absolutely nothing. Executive Gold Membership - £5 a month. If you become one of our Executive Gold Members this will entitle you to absolutely nothing at all. Super Platinum Gold Membership - £10 a month. If you join the Super Platinum Gold Membership scheme you will not gain entry to special lounges at airports and railway stations and you won’t get a special gift every month."
https://www.patreon.com/AlexeiSaylePodcast
A more sustainable way to create
The move to a more digital economy has a profound environmental impact, and this is as true about the creator economy as elsewhere. In fact, the creator economy may have even greater implications for the environment because it allows for more efficient production and distribution of goods and services. Digital content is now produced using computers powered by electricity rather than CD's and books produced using energy-intensive processes and larger amounts of resources. This shift not only reduces pollution emissions but also cuts costs associated with maintaining old infrastructure. For example, millions of print books are produced, distributed to bookstores, recalled, and pulped every single year, while not a single ebook has ever been pulped. I dunno, maybe it has, but I've been sitting here for about five minutes trying to work out if that's feasible, and now my head hurts.
Another way in which the creator economy impacts the environment is through its ability to create new jobs. These jobs are in sectors that require minimal or no impact on the environment, and are largely done at home, cutting out the commute. The creator economy has also had a positive impact on public opinion. More people now see entrepreneurship as a viable option, and this has led to an increase in the number of businesses founded on creative ideas. In addition, many people now see themselves as producers rather than just consumers, which has led to a shift in attitudes towards consumption.
A new model: YouTube monetisation and streaming income.
In 2007, YouTube introduced its first monetisation scheme: viewers could donate money to content creators in exchange for ad-free viewing. In 2008 YouTube turned its focus on creating advertising formats that helped their growing creator community make money from their content on the site, leading to the first YouTube millionaires, who took the fractional money made off each view and scaled it up with the huge user base that YouTube had developed.
In 2013, Spotify began allowing artists and labels to earn revenue from listeners who streamed their music offline as well as online leading to Spotify millionaires, where bands who got a million listens on the site could make enough money to buy a single coffee, so long as they didn't all mind sipping from the same cup, and if they bought it from Ange's caff down Islington high street, where the coffee beans come out of a weird-looking tub and smell like Bisto gravy granules.
In 2017, podcasting became the latest popular form of streaming content with large audiences, but the opportunity to monetise these through targeted audio advertising meant that whatever the subject, you could sell someone a Squarespace subscription or Casper mattress. With audio equipment and editing software cheaper than ever, every person on the planet is now estimated to have at least seventeen podcasts in development. In fact, here at All Creatives Now we can't believe it's taken us this long.
These models have inherent flaws. For example, it's difficult to make a living on YouTube if your video isn't popular. And even if your video is popular, you may not generate enough income to support yourself. If you're a musician, then I hope you like touring, because you're not getting any money out of Spotify, though you will need to show your popularity on the platform to book a show anywhere, so it's not like you can pull your music from there unless you're Neil Young, because Uncle Neil can do whatever the fuck he likes, apparently.
The only good part of the pandemic: The great resignation and the rise of the creator economy
In November 2021, 4.5 million workers in the United States quit their jobs. This is according to a monthly Job Openings and Labor Turnover survey released by the U.S. Bureau of Labor Statistics. The record number of workers quitting continues a nationwide trend of voluntary resignations, and it's not just in the US. In the UK, a survey of 1,000 UK workers revealed that almost a third (29%) of UK workers are considering moving to a new job in 2022.
A Texas A&M University professor predicted the mass volunteer exodus last May with a theory he coined as “the Great Resignation.” Anthony Klotz, an associate professor of management at A&M’s Mays Business School, described the term in an interview with Bloomberg that predicted an unprecedented rise in voluntary resignations as the United States exited the pandemic. Klotz later explained the theory in more detail in an op-ed with NBC News.
“At Texas A&M, I study employee resignations,” Klotz said. “Not only why people quit their jobs, but how people quit their jobs, so I think about resignations a lot. I talk to my students about resignations. It’s what I study, so I picked up on these trends a little bit early and I said in that Bloomberg interview the Great Resignation is coming and that’s the article that went viral and sort of changed what I do on a daily basis.”
Klotz predicted that the Great Resignation would occur because of the pandemic's uncertainty, high level of burnout among workers, companies restructuring their work schedules, and what he called "pandemic epiphanies". The latter, where people took the enforced isolation of the pandemic to re-evaluate their relationship to their jobs, their careers, their meaning, led to a vast swathe of the population quitting their jobs in order to start their own creative businesses. This is a trend that is gaining momentum, and there are plenty of reasons why this might be the case.
Foremost, there are simply more opportunities for self-employment within the creative business than ever before. Technology has made it easier than ever to start and run your own creative business, and there are now countless platforms available on which you can make money, from Patreon to Amazon to OnlyFans. Additionally, the global economy actually remained in a sound position in the immediate wake of the pandemic, which meant that there seemed to be lots of opportunities out there for entrepreneurs who seize them, though that trend is changing in recent months.
There are plenty of other reasons people are starting their own creative businesses in record numbers. For some, it’s a way of expressing their creativity and individuality, while others see it as an opportunity to earn a decent income without having to take on any kind of full-time job. Since the pandemic, there has been a growing movement to create a more sustainable and fair way of living through independent creation. The creator economy has been criticised for its lack of transparency and its reliance on the sharing economy, but proponents believe the model has the potential to create something akin to a utopian future that’s a bit like what they have on Star Trek. As usual, the truth lies somewhere in the middle, just like that Jimmy Eat World song.
So what does it all mean?
The creator economy has arrived on the backs of the rise of technology, like suckerfish riding the backs of Skynet all the way to the coming apocalypse. Previously, it was difficult for artists to control their own careers and businesses. However, with modern technology, they can now do so. This has allowed them to create content that is more relevant to their audience and make a living from it. The rise of crowdfunding platforms has given creators even more opportunities to raise funds and grow their businesses. Here at All Creatives Now we're going to be looking at this area through conversations with creatives across the gamut of creative fields, and bringing you useful news, reviews, and interviews. The creator economy is still in its early stages. There is a lot of room for growth, and it is likely to continue to do so in the future. Stick with All Creatives Now, and we'll help you find your place in it.