How Web3 Creators Platforms Evolve

The New Creative Economy: How the Web3 Creator . Platforms Are Evolving

Image credit: (c) SpeedInvest.

Web3 and the technology behind it will redefine all areas of the economy. Already deployed in the backend of many software applications, blockchain as part of Web3 has the potential to impact the way we interact with the Internet more than mobile devices and the cloud ever did. From an economic perspective, this is especially true of the way we create and transmit value online.

Creator Economy: Dominated by Traditional Platforms

The creator economy is made up of people who, like most of us, have a passion or hobby that can be marketed online. Platforms like YouTube, TikTok or Spotify play a central role, and it aims to enable creators to earn an income from what they love. However, actual revenue opportunities through merchandise, subscriptions, ad revenue, or “tips” are often limited and only relevant to about one percent of creators. To make matters worse, the platforms have a very large share of the income generated by their creators. For example, musicians receive only about ten percent of the profits of a streaming platform, and the rest goes to the record company. Platform algorithms also do not provide any means to discover creators and few provide direct ownership so that all stakeholders can benefit from their contributions.

Investors are paying attention

But the explosive growth of the creator economy is also fueled by record amounts of funding pouring into the marketplace from prominent investors — $1.3 billion in 2021 alone. Online content distributors such as YouTube, Facebook, and TikTok also have their own money created for creatives that enable them to jump right into the sector and help them attract creatives to their platforms. Of course, this business strategy makes sense when you consider that the quality of the content on the platform determines the value of the platform and is directly responsible for attracting and retaining millions of users.

But despite these advances, most creatives face the same problems they’ve had for years: they still don’t get enough compensation for their work, which makes it difficult for them to get a steady income.

The New Creative Economy: A Community Owned Ecosystem

In association with Antler, Speedinvest has published a detailed report on the Creator Economy on Web3. In it, we examined 144 startups and 100 investors around the world working to disrupt the creators’ economy. Platforms are increasingly community driven, making it easier for both creators and their audience to benefit from their content.

Today, the definition of the term “creator” has changed with the advent of Web3 as the power dynamic shifts from platforms to content creators and their followers. The creator economy is no longer just about adding value to platforms. It is about new forms of direct relationships between authors and consumers. Increasingly, creators are empowered to do more for their fans (including monetary rewards), giving themselves and their communities more participation in the collective value of the new platforms. In their ability to create self-sustaining networks and more equitable ecosystems where people serve each other and society at large, we see the greatest potential of the new creator platforms on the Web3.

The United States gave the green light

Looking at our data, it turns out that the creative economy in North America is by far the largest. Of the 144 companies, only 18 are in Europe. However, given the differences between the two consumer markets, this is not a surprise. North Americans, particularly in the United States, are generally considered to be more risk averse than Europeans. The “American Dream” promotes the idea that the United States is a “land of opportunity” and that an attitude of risk with high odds is a virtue. While one could argue about the accuracy of this view, it has always helped drive innovation, as the country is at the center of many technology booms and hosts a relatively high percentage of early adopters.

Europe is catching up

But there are now more and more European developments, such as French fantasy football game Sorare, which recently raised $680 million led by Softbank to build the next European entertainment giant. Ledger, also a French company, is making digital assets more secure with its crypto hardware wallet. Axie Infinity from Norway/Vietnam NFT also relies on Web3 to develop its gaming platform. Also in the Speedinvest portfolio is Admix, a startup that enables developers to create, manage, and sell AR/VR inventory in minutes. Admix provides a plug-in for Unity and Unreal Engine that can be used to display regular ads in VR/AR or game content. With our automated platform, you can filter out hundreds of advertisers and start earning in minutes. Companies like this are now springing up in leaps and bounds across Europe. Not only is it growing at a fast pace, but it is also attracting great interest from European and North American investors.

About the author
Paola Vivoli works in Speedinvest’s London office and is a member of Speedinvest’s Marketplaces & Consumer team. Prior to joining Speedinvest, Paola worked at Rothschild & Co on the consumer, retail, and entertainment M&A team that fueled her passion for consumer-facing products and markets.

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