Whether through nirvana or crushing boredom, it seems nothing quite gets people’s creative juices flowing like being locked away in their homes for a few months. The creator economy, unlike the real one, has boomed during the pandemic, at a pace that would put even the most nimble startup to shame.
The creator economy is like startups on steroids
Three days ago, an investor in a ‘creator economy’ platform told us that everything that has happened in the startup world in the past 20 years will happen in the creator world in the next 10.
A founder, who is building a creator economy platform, said it’ll happen in the next three years itself.
So, we tried to unpack it all for you this morning.
But first, some context.
The creator economy has pretty much exploded amid the ongoing pandemic.
Every day, someone we knew or knew of either started a podcast or a newsletter or a good ol’ YouTube channel. More recently, it was a Clubhouse room.
But just like their predecessors in the ceWebrity world (it’s a legit
term), they too were quick to realise that for all the followers and hearts creators rake in, only the top 1-2% end up making enough money off their fandom to call it more than just a “side hustle”. (ETtech has written about this in two separate stories last year. They can be read
This time, though, the creator economy has the blessings of the tech community as entrepreneurs and investors in the West, and back home, look to develop and support businesses that solve the problem of monetisation for creators either by creating tools or strong community-led platforms for them.
Since the start of the year, for instance, Silicon Valley has shown extraordinary interest in building for the creator economy.
We see it in Twitter’s announcement of an upcoming feature, Super Follow, that will allow users to ask their followers to pay to access some of their tweets. And in
its acquisition of newsletter startup Revue.
Even as Twitter gears up to compete with Substack, a writer’s collective on Substack called ‘Everything Bundle’ spun out of the subscription newsletter platform to start their own content and newsletter software company,
Every, with $600,000 in seed funding.
Last month, Li Jin, a tech investor who coined the term “
passion economy” in 2019, announced Atelier Ventures, a $13 million fund to support said passion economy.
Jin, who was previously with Bay Area’s leading VC fund, a16z, is currently running a limited-entry, three-week ‘Creator Economy’ course that costs $1,250.
Meanwhile, a16z just invested an undisclosed amount in creator economy startup, Stir, which helps creators manage their income streams, at a valuation of $100 million.
ION: At least 40 popular Clubhouse members have come together to form the “
Audio Collective” with the aim to help brands, businesses, and creators optimise their impact on live-audio platforms like Clubhouse, Twitter Spaces, et al.
India Stack Coming Together
Techies back home have also been busy building for the creator economy and raising institutional funding for their respective early-stage startups.
However, their journey will be very different from that of their counterparts in the US.
As one founder building for this sector says, “We operate across two different worlds. One is on Twitter, where you see the likes of Li Jin talk about building a community of
100 true fans.”
“The other is offline (these days on Zoom calls), where the marketer we signed a deal with watches an obscure TV channel every day to track their ad placements!”
At present, the creator economy in India is fighting for respect from industry veterans.
Sick of marketing “veterans” who feel like treating younger people with respect is beneath them.Here’s a snapshot… https://t.co/ERcQYXtNTB
— Viraj Sheth (@viraj_sheth) 1614248534000
At the same time, it has the backing of some of the startup world’s biggest
Let’s move on to other big developments of the week, as there were plenty.
DEALS IN THE WORKS
1. All aboard the Tech IPO train!
Zomato, the food-delivery app poised to be the first among a growing tribe of Indian tech startups eyeing a listing this year,
is expected to raise $750 million to $1 billion through its initial public offering (IPO), said two people familiar with the development. But unlike traditional IPOs, no investor is likely to exit or take money off the table by selling their shares.
PolicyBazaar rejigs cap table ahead of IPO
2. RIL, Kalaari make it official
Reliance and Kalaari
have made their alliance official, by way of an email.
Reliance Industries Ltd. (RIL) has come on board as an anchor limited partner in Kalaari Capital’s fourth fund, the domestic venture capital firm’s founder and managing director Vani Kola told startup founders and investors in an email.
3. Before IPO, leadership changes at Flipkart
has appointed Unilever’s Hemant Badri as senior vice president for supply chain operations, and shuffled and expanded the roles of Amitesh Jha and Ranjith Boyanapalli, according to CEO Kalyan Krishnamurthy’s letter to employees on Monday.
The changes are effective immediately.
Flipkart weighs US listing via SPAC route
ETtech’s TOP 5 STORIES OF THE WEEK
What the Wipro-Capco deal means for Indian IT: The Wipro-Capco deal would also help Indian IT companies break into the big consulting league. They will now own the entire lifecycle—from consulting to building the technology architecture.
■ IT exodus from Gurugram? Haryana’s proposed move to reserve 75% of jobs for locals with salaries of up to Rs 50,000 a month could
lead to an IT exodus from Gurugram, according to top industry executives.
- ~70% of the IT workforce has less than five years of work experience.
- Nearly half of all employees earn less than Rs 50,000 per month.
■ The rise of the Indian influencer-investor: After collaborating with startups to create branded content for them in the last few years, top creators
are turning angel investors by putting anywhere between Rs 2 lakh and Rs 20 lakh in early-stage funding rounds of new economy businesses.
■ NUE World Order: Everything new attracts interest. Everything NUE does too.
The relentless interest in seeking a New Umbrella Entity (NUE) licence from RBI continued this week. But while Visa and Mastercard
are reassessing their plans, Flipkart and PayU
have partnered Tata Group in setting up a for-profit alternative to UPI. State Bank of India, which was blocked by the finance ministry from bidding,
isn’t giving up on the race.
■ No more Chinese money, no IPO for Dream11: Dream Sports, which is currently executing a secondary sale of shares that will value the online fantasy sports platform at $4 billion, won’t raise any fresh capital from Chinese investors in the future,
its founder and CEO Harsh Jain told ET.
The company, which operates the fantasy sports platform Dream11, has no plans for an IPO either, for it wants to diversify first into a sports tech company.