It’s A Wrap
The Creator Economy is booming and NFTs are skyrocketing! – By Lynn Pearce
I wrote an article on NFTs for this magazine’s August edition – and in that article I questioned whether NFTs were a passing fad, or a future asset and here to stay. The jury was out on that one, as most of the predictions from several top publications believed NFTs would fade away, however, my conclusion was that they were just starting to make headway and that the market for NFTs would explode. It turns out I was right, as I am reading about NFTs daily now and have been almost overwhelmed with all the news and activities around this growing phenomenon, driven mostly by the Creator Economy (it’s a new revenue stream gold rush), social media influencers, bloggers, videographers, iGaming, and NFT startup businesses.In fact, some of the new platforms are making it so easy that anyone can mint their own NFTs and make money off it.
Being in the sports betting and gaming industry, it is interesting to see the surge of interest from global sports teams, with incredibly valuable intellectual property, tokenizing and distributing their collectibles in the form of digital trading cards.
In fact, one of the major benefits that I can see is how musicians, artists and the creative community are now an integral part of the process of selling their art form, and with the new digital assets business model conferring ownership, they are a part of the ongoing sale process and herein lies the key to the continuing popularity of NFTs, in my opinion this is one of the biggest drawcards for this emerging community-based business model.
This morning, I read in The Information newsletter that OpenSea, the most popular marketplace for NFTs, (which is about four years old,) is fielding new investment offers that could increase its valuation to $10 billion or even higher! Not a bad business to be in, and it is growing exponentially, as there are now well over 50 million people worldwide, according to investment firm SignalFire, who are working as content creators. The creator economy’s rise to the mainstream over the past year is in large part due to the lockdowns and working from home during the pandemic, including the rapid scaling of social media platforms and streaming services exploding during this time to support this industry.
According to Crunch base, the roughly $20 billion creator economy is thriving—with each creator operating more like a start-up than an individual. “Influencer marketing is poised to surpass the $3 billion mark by the end of 2021. Streaming platforms from Netflix to Disney+ and Amazon Prime continue to scale operations globally, diversify offerings beyond TV or movies, and sign top talent to long-term contracts.”
So who are these creators? The demographic is really interesting, as some of these creators have been around for more than 10 years already, which shows when you see that the content creator age group on YouTube is 54+ (22%), then 18 to 44 on Instagram (22%) and 18 to 24 on Tiktok (30%), with the main source of income being brand deals, as brands soon started to realise the return on investment of paying creators and influencers to scale their on-platform reach advertising their products and services.
Interestingly, there are already several Unicorns in the Creator Economy space, which are likely increasing the overall VC interest and belief that it’s possible to build large companies in the space, in particular the startup platforms that are seeing the opportunities of servicing the needs of
these creators, especially with financing, for example,Trading.TV built a new Twitch-style platform focused specifically on finance influencers in all industries. Investment firm SignalFire, recently invested in Karat, a custom charge card banking solution for creators and influencers on YouTube, Instagram and Tiktok. Karat gives creators the ability to aggregate all sources of income onto a single platform, offers income smoothing for creators on a week-to-week basis and provides instant loans based on predictable future income. Another great financing startup is Channel Meter, who created a payment app to give cash advances to YouTube stars.Stir takes the creator economy business a step further and is a payments network that helps creators track their finances and compensate employees and collaborators directly.
However, while the top creators may reap six to eight figures in annual turnover, the amount of money full-time content creators bring in is relative to their fans, niche, industry, and other factors, like engagement rates and location/platforms. The average creator is generally doing this as a side hustle while growing their target market and earning much less! On the plus side, earning money while doing something you love is certainly not a bad thing, while a number of these creators have already left their full-time jobs to join the creator economy full-time, as we have been seeing lately, with the “great resignation” still happening on a global scale!
The Creator Economy is definitely growing, and what truly fascinates me is the younger generation who have already embraced it, as they look to these content creators as their influencers.
They do not follow traditional movies and TV channels, they would much rather be entertained by someone like Ryan Kaji, a nine-year-old who shares videos on YouTube. He has over 31 million subscribers to his Ryan’s World YouTube channel and must be the envy of traditional television networks and I think is showing us all the way forward!
