Creator Businesses Are a Risky

How to build with de-risking in mind

Photo by Pat Whelen on Unsplash

One of the biggest blind spots in creator economy discussions is about just how risky creator businesses really are. This is for quite a few reasons, but predominantly:

- Creator mental health / burnout: it’s hard to keep up with the joneses.
- Hype cycles: time on top has an expiration date.
- Poor decision making: one bad decision and a creator’s career is over.
- Platforms and algorithms: at the will of platform changes, decisions, and distribution.
- Revenue inconsistent and not diversified: a lot of creators have over 50% of their revenue coming from one source.

The MCN model was to de-risk through volume in exchange for 10% of ad rev. This hasn’t played out because it heavily favored MCNs.

So, I think the better question to ask is: how do boutique management agencies or small creators de-risk? And then, further, how do companies entering the space build with de-risking at the core? Here are some ideas:

Make creator collectives.