TechStuff Classic: Patronage Makes a Comeback

through things like ad revenue. But it becomes more of a sort of a direct subscriber kind of approach. So let's sit back and listen to this classic episode. I've covered topics like e commerce before web advertising, We've covered multiple times on this show. We've even covered crowdfunding stuff like Kickstarter in Indiego Go. But I really wanted to look at patronage because it's interesting to see it come back so strong. That's not to say that patronage is new,

even new on the Internet. It's not. It just seems to be rising in prominence right now. The idea of patronage dates back to the Renaissance, and I gotta be honest with you guys. I debated briefly but I did debate on describing Renaissance patronage in the style of the character I used to play back when I was an employee of the Georgia Renaissance Festival. But then I figured you guys would probably unsubscribed so fast that you'd actually hear the whishing sound of the wind filling in the

vacuum of missing listeners. So I'm going to spare you the corny Renaissance festival character for now. But if you really want to hear me, cut loose as a Renaissance festival idiot, stick a round to the very end, and then you'll get a treat, or maybe you'll think of it as something other than a treat, but at any rate, it will be at the end, so that way you

can not listen to it if it bugs you. So getting back to Renaissance and the era of patronage, when you look at the Middle Ages in Europe, the period preceding the Renaissance, the primary social system in place was feudalism. And in case you're not familiar with feudalism, what the concept is or how that worked. This was where you would have a centralized power figure of some sort to whom everyone in the region would swear fealty, and this

was a two way relationship. It wasn't just someone lording over a lot of peasants, although that could happen. The person in charge was supposed to make big decisions on behalf of the entire region, and in the best case scenarios, uh, they would actually take great pains to protect the people

they ruled over. In fact, if you look at stuff like the old epic poem Beowulf, you hear about the the job of the king is to hand out rings, which is essentially the symbol of wealth two loyal subjects who have have contributed in some meaningful way to the area's success. That was the basis of society for centuries in Europe. But once you start getting toward the end

of the Middle Ages, things start to change. Now, during the Middle Ages, you know the peasants really their job was to essentially make enough food for everyone to stay alive, including the person in charge. But at the end of the Middle Ages, the system of feudalism began to fall apart, and it also marked the first time people really begin gan to move in great numbers from the pastoral countryside

and farms in to cities. This was the era of cities having an enormous population booms, so places like Paris and London had their numbers swell, and out of that change grew something brand new, the middle class, or the bourgeois in other words. And as professions became lucrative, as people began to find ways to create things, to make goods or provide services that were valued within the cities, people began to make money. The middle class began to

make serious money. Sometimes the people in the middle class were far wealthier than anyone in the nobility class. There are plenty of examples of nobles who were arranging marriages with wealthy middle class families because the middle class families lacked a title, but they had money, whereas the nobility had titles but no money. So it became this weird relationship,

particularly in places like England. Now, some of the people in the middle class wanted to use the money they made to do various things, including supporting artists of various types. Maybe they found it rewarding to support an artist's work, or maybe they got some other sense of value from it. At any rate, they became what we call patrons of the arts. And there are lots of examples of various

patrons who were really famous at the time. The Medici family is probably the best known patrons from the era of the Italian Renaissance, particularly Cosimo de Medici and his grandson Lorenzo de Medici. These two Medici's were famous for their patronage of various artists. Uh. Together they supported some really famous ones like uh. Well, names that would seem familiar to anyone who watched teenage mutant Ninja turtles because they boarded artists like Donna Tello, Leonardo da Vinci, and

michel Angelo and Uh. The patronage actually gave these wealthy people a certain social status. It allowed them to associate themselves with the most talented, brightest people of the age, and it also created opportunities for the artists to make amazing works of art, ranging from paintings to sculpture and

other stuff. Often the artists were working on a commission by the nobility, so they didn't really have a whole lot of choice in what they were able to make, but the money they made from that allowed them to fund other things. Famously, Da Vinci came up with lots of different stuff. Meanwhile, theater companies also had patrons. William Shakespeare belonged to the Lord Chamberlain's Men during Queen Elizabeth

the First's reign uh. The initial patron of that theatrical company was a man named Henry Carey, who was the first Baron Hunston uh, the Lord Chamberlain to the Queen. Now, eventually that company would become the King's Men because Elizabeth passed away and James the First rose to the throne and became the new patron of this theatrical company. So they provided the budget that the artists needed in order for them to do their work, and then they would

also reward the artists themselves. Um and this approach allowed ours to protect practice their craft without worrying about selling the finished product to buyers, though that could also happen depending upon the artist. So generally speaking, it was a work for higher sort of thing. It wasn't an idea, you know, create a product and then go to the market and try and sell the product. Today we still have patrons of the arts. A lot of wealthy people

will end up funding arts in some way. There are a lot of foundations that also provide funding and others who donate to museums or to theaters. But when it comes to supporting individual artists, patronage had largely faded away until relatively recently. But now we're in a new era of patronage. And it also makes sense because honestly, the era of advertising is starting to come to an end. We've become tired of ads, so making money through ads

has become increasingly difficult. It's a challenge. It's still very important, but it's harder to do, largely because the audience itself has become cynical or tired of ads. Uh, you can try to sell stuff in an online store instead, and that might work great for certain types of artists, like people who do graphic design work and maybe they do sketches or paintings or comics or things of that nature. They can sell different prints or posters. That sort of stuff.

Also makes sense for musicians who might sell things like albums or individual songs that kind of thing. But there's some types of creative work that do not lend themselves to merchandise easily. So for example, maybe you do a series videos like you have a web video series, and you might have some merchandise options, but generally speaking, those are probably not going to bring in enough money to support your work, So what do you do? Well, that's

where patronage comes into play. Now. The best known service right now is Patreon, and that service allows creators to build a profile for their work. Fans can contribute money on an ongoing basis. Creators can set up a Patreon account so that the pledges are collected monthly or every time there's a new piece of content for an audience to enjoy. So, in other words, if I'm a creator and I want to create a Patreon page, I could do it. Let's say I'm doing a web video series.

I can do it where I say pledge x amount per month, and you might say a dollar or five dollars or whatever that might be. Or I could choose to say pledge x amount per video, so every time an episode comes out, you would end up contributing however much you had pledged, whether it was a dollar or five dollars or whatever amount. Those are the different options. Uh, it's kind of like a subscription service, only you aren't

necessarily buying something. You're supporting the work of someone who's stuff you like, so you're not necessarily getting something that no one else can get although that can play apart two and I'll talk about that in a second. But really what it's all about is saying I like the stuff you do. I want you to continue to be able to do the stuff you do, and I'm willing to pay money so that this happens. And it's interesting

because at least for some people it works. Now, in the interest of full disclosure, I wanted to let you guys know I support to Patreon campaigns right now, and I'm not asking anyone else to go out and support them. I just want to be able to talk about my experience as a patron as opposed to a creator. I don't have a patriot On campaign for anything that I do. I just support other Patreon campaigns. So the two campaigns I support, one of them is for Tom Merritt's daily

tech news show, and Tom's a friend of mine. He does great work. He covers tech stories each weekday and brings on interesting guests and sometimes people like me to be on his show to discuss the stories and give them context. So I am one of many patrons of tom Merritt's and I want him to continue to be able to do this work, which I think is valuable. It's entertaining and it's informative. So that's why I have contributed.

The other Patreon campaign I support is for a group called Red Letter Media, and that's an entertainment company and they create online videos and plus they create films. They're they're essentially a film studio that also does online video. Now, they're mostly known for their film criticism. I have several shows that focus on the sizing films in various ways. There's one called half in the Bag, there's one called Best of the Worst, and then there are the infamous

Mr Plinkett reviews. So if you've ever come across one of those reviews of either Star Wars or Star Trek where the persona doing the review is a crazy, sociopathic old guy, that's Red Letter Media. Now there are hundreds of projects listed on Patreon, and some of them may even be for stuff you already enjoy. So how does the service work? I mean, how can it actually work

in a in a in a background sense. I mean, clearly it's not as simple as just a sorting house for audience contributions, right, I mean, how would Patreon even make its own money? So that it could remain in operation. Well, to answer that, we need to look at the history of Patreon and then at how the service makes money, and it all starts with a pretty successful YouTube channel. Now.

That channel belongs to Jack Conti, and he's a filmmaker and songwriter living in California, and he's also one half of the group Pomplo Moose, which if you are not familiar with Pomplo Mouse, you should probably go and check that out. They're pretty awesome. They do fun musical mashups and really creative music videos as well some very experimental film stuff that's kind of interesting, So check that out. We'll be back with more about patronage in the online

age after this quick break. In two thousand thirteen, Conti had a YouTube channel that had more than a hundred thousand subscribers and his videos were racking up more than a hundred thousand views per video, but he was faced with a real problem. He says he was only making about fifty dollars a month off his channel from advertising, so it's a big issue he was He was doing well, he had a he had a sizable audience, but he wasn't really realizing any true revenue from it, and there

are a lot of factors that figure into this. If you allow advertising on your videos on YouTube, you only get a percentage of the money earned through ads on your channel. The rest goes to Google to YouTube itself. Now, on top of that, you have to choose whether your channel will serve up ads that people can skip after a few seconds or ads that play all the way through and there's no skippable option, and subscribers tend to prefer skippable ads obviously, they don't want to be forced

to watch a commercial if they don't have to. But if they get a skippable ad and they skip out too early, in other words, before thirty seconds have passed, no revenue is generated from the ad impression, so that's an issue. And YouTube also has algorithms that determine how frequently ads are shown in the first place, so not every view of a monetized video may result in an ad display. So there are a lot of factors here that actually limit the amount of money you're going to make.

You on paper, it looks like you should be making a lot because you've got so many views of your video, But if everyone is skipping the the ads, or there are not a lot of ads being served up on that video. In particular, you might be making very little in the long run. Now, the bottom line was that Conti was putting time and effort into creating videos but

seeing very little return on his investments. So he began to think about ways that artists could create a direct link to audiences, something that would allow audiences to support the artist rather than having to depend upon this third party advertising structure. So in May two thousand thirteen, Contie paired with partnered with Sam Yam to create Patreon, and the idea was pretty simple. Artists would create a Patreon account, they would offer reward to people who contribute money to

their efforts. Uh So those rewards could be anything, really, but ideally there would be things that you could easily deliver reliably so that people who are supporting you actually

feel like they're getting value for their contribution. So, for example, if I were doing that web video series, I might offer up an access to bonus videos or blooper reels and other content to people who contribute at a certain level, and anyone who is either not contributing or contributing at a lower level, they don't get access to that, but they can still see the regular web video series. The important thing here is I'm not forcing people to subscribe

to something. I'm saying, if you want to support me, here's a way to do it, and in return, you get this bonus material. But if you don't feel like you can support me for whatever reason, maybe you don't enjoy the content that much, or maybe your money is very limited and so you can't really afford to support me, that's fine. Enjoy the regular series with everybody else. You're

still going to have access to it. It's only if you want to and are able to, and you want this bonus material in the first place, that you should contribute. That tends to be the general approach most creators take when they're using Patreon. It's the idea of added value and also for people to express their appreciation for the work that you do. And it's amazing because it actually

seems to work. As for the rewards, there are a lot like you would see on stuff like Kickstarter or Indiego Go, and higher levels of contribution typically correspond to more prestigious awards, such as being acknowledged as a producer, for example, and to give a specific incident, Tom Merritt and producer Jenny Josephson of Daily Tech News Show once read out the names of every contributor to the Daily Tech News Show Patreon when they hit ten thousand dollars

per month ten thousand dollars of contributions per month. So it took them just under four hours to go through all the names, and they even threw in lots of puns and other silly things for almost every single name on that list. And if you want to search, the video is up on YouTube. You can find it three hours and fifty nine minutes. If you want to hear when my name comes up, because I was a patron at that time too, it's at the one hour twelve

minute mark. He's actually really nice. He gave a shout out to how stuff works, which was lovely, so fun time there, it was interesting, and that was just something that he decided to do, and actually I think it was Jenny's suggestion. They decided just to do that spontaneously to thank the people who had been supporting them. It wasn't part directly part of the Patreon support. So that was really really fun and and showed a lot of dedication to sit there for four hours and thank every

single person by name. Now, this might sound similar to something that's been around for several years, that being the PayPal tip jar approach, So you've probably seen this around. Lots of creators have included a tip jar on sites to allow fans the chance to contribute directly to their favorite artists or writers or whatever. So this would be on various sites where you see the little PayPal button

you can click and then contribute a certain amount. You can even make it a recurring contribution if you wanted to. So that's very similar to what Patreon offers, and that's been around for a while. But it's one of those things that I think, you know, I'm sure people have collected money from it, but not large amounts. It's not terribly visible, and so it's it's not like it's not like Patreon has replaced this button, but certainly augmented it.

And Patreon also has built in tools that allow creators to communicate directly where their supporters, which was something that the PayPal button didn't supply at all. The PayPal button was really just a way for people to contribute directly

to a person. Patreon is more of a community building tool because you can actually send a message out to all of your Patreon supporters and give them updates, give them links to special content, give them alerts to things that you have planned that haven't been officially announced yet. All of this kind of stuff. The idea of including people into an artistic endeavor is built into Patreon Now.

Patreon charges the pledges at the end of each month, so if you end up supporting a Patreon campaign, you're not going to get charged until the end of the month, and that might mean for some pat patrons are really long wait if you join at the very beginning of the month and pledge, because you won't be charged till the end of the month, and you might not actually have access to the Patreon level rewards until your money

has been processed. So if I start off on on September one and I pledge at a certain level because I want to have access to this special stuff, it may not be until the following month until October when I'm able to actually access that. So that's one downside to Patreon. There are some others too. Obviously, if you do not like PayPal, that's another issue, because that's the main way to contribute money. Through Patreon, and if you object to PayPal, then that could be a real, real problem.

One thing that's nice about Patreon is that it's not necessarily a means to get a project off the ground, So in other words, the work itself is probably already done. In most cases, you're you're not risking anything. You're not contributing money to a campaign that might ultimately fail, which can completely happen with Kickstarter and indie go go. Now, of course, in Kickstarter campaigns, if the campaign doesn't fund,

you aren't charged. With indie goog, you are charged because even if a campaign doesn't mean it's campaign goal, some of that money will end up going to the creator. In both cases, if the campaign funds but nothing ever comes out of it, you are left in the lurch. And this has happened to me three times. I have supported three different campaigns through crowdfunding that never ever went anywhere. These are the infamous smart watches I have backed, and

all three have languished and never got to me. So learned from my lesson. Also, I think it's important to remember anytime you see any kind of crowdfunding thing, if it's for a physical product, way that with the idea that this may never happen even if the project funds, because physical products are hard to produce, uh, they can often cost more money and have more problems than someone

would would have they're wise predicted. So that's always valuable to go into a crowdfunding situation knowing that ahead of time. And if you're okay with that risk and you believe in what the people are doing, that's fine. But if you're thinking of the kickstarter as a way to start a pre order on something, you could end up for with a rude awakening further down the line at any rate.

Patreon is not like that. With Patreon, most of the time, the creators are doing something they love and they're going to be doing anyway. This is just a means for them to be compensated for some of that work. So, for example, it might be a web comics artist who is going to continue drawing web comics no matter what, but this is a way for you to express appreciation and help support the web comics artist in his or

her efforts to bring that art to you. So it's it's very different in that it's not it's not like you have to wait for a certain threshold to be met and then you get whatever it is you're supporting, You're getting it already, So I think that's pretty exciting. And also, you can end your support at any time. You can go into Patreon and say I'm done supporting this particular campaign. I either you know, I'm no longer interested in it, or I can't afford it, or whatever

the reason. Maybe it doesn't matter. You don't have to provide a reason. You can just stop your support. You've got a bit more to say about Patreon and similar services after this quick commercial break. As for Patreon itself making money, well, it got started with venture capital investments. You know, this is the way we see a lot of startups start. You know, how they're able to stay afloat early on is that they get investments from outside

to get things moving. But beyond that you have to create a different model or else you're business will ultimately fail. So what Patreon does is it takes five percent of all the pledges that are gathered for all the different Patreon campaigns, and so as more people create Patreon campaigns and more people support Patreon campaigns, more money rolls in and eventually those different five percent uh pieces start to

really add up. In October two thousand and fourteen, Uh, that was the first time we started seeing creators on Patreon collectively making more than one million dollars per month. So adding up all the different Patreon accounts, they're about a million dollars a month going through Patreon. But even then, if you look at that five percent, that's just fifty tho dollars a month, which that's a lot of money, don't get me wrong, but fifty a month for a

company is a relatively small amount. So Patreon has to stay pretty small and nimble in order to uh continue to provide this service. Oh and one other thing. That five percent is just part of what gets taken out of the final pledge total. It's not like creators are getting of the money because of PayPal. PayPal also takes a cut. So ultimately about nine to of the money that is supposed to go to a campaign gets taken

out for fees of various types. So that means you're going to end up with around nine percent of all the money that has been contributed to your campaign if you are a creator on Patreon. But then keep in mind that if you are trying to use advertising for example, to support your work, you get to keep way less

than nine percent of that money. So if you have a YouTube video series and you're monetizing your videos on YouTube, YouTube is taking a much larger chunk than ten percent, you are not going to be able to keep of the money that your videos earned. So that's something to

keep in mind. Although, again, if this is an opt in situation where people come and then they dedicate their money to your work, you're going to see a much smaller percentage of your overall audience willing to actually pay a monthly or or per item fee to get the stuff they could get for free. Uh, there will be some, but it will be a percentage, a small percentage of the overall audience. So if you're a creative person, all this is kind of sounding pretty attractive. You could have

a platform to reach an audience. You could cultivate a following and really gain support from the people who love your work. But it's not that easy. For one thing, making people aware of the option to support is already a challenge. Discovery can be a difficult thing on Patreon. Most people don't go to Patreon to just do searches to find out what kind of stuff they love and how to support it. If they hear about it, they

hear about it from the creator. So it means that you have to use lots of different channels of communication to tell followers how they can support the work they love. It might be through Twitter and Facebook and Tumbler, and it might if you have a podcast or a video series, it could involve announcing that every episode so that people are aware of it, because otherwise, if they're not aware of it, you're never going to get any support anyway.

Some people, some creators, make it a point to regularly thank their supporters in every episode. So instead of saying, hey, go to Patreon and put money to support my work, they might say, I want to take this time to thank all of our supporters on Patreon, without whom this show is not possible. And that's a really nice way of saying thank you. It also reminds people, hey, if you want to support this, you can go to Patreon

and be part of that group. But it really, ultimately is more about being genuine with your audience and saying you guys are awesome for loving what I do, and I will keep doing this and keep making the stuff you love for as long as you love it. And I think that that is a really powerful message, and it's actually true for most creators. I don't think most creators are out there trying to get rich quick. They're

doing what they do because they love doing it. And if they're successful, that's awesome, that is that's the dream. But if they're not, they're still doing what they love. But obviously all of this works best for people who already have a large following, people who have already established themselves and have an audience and can speak to that audience and say, hey, by the way, here's this place

where you can support me. So if you're not fortunate enough to be one of those people, Patreon might not bring in enough to help sustain your work. But if you're planning on doing the work anyway, whether you get that support or not, and you just want to do it for the love of the work itself, it might be worth your while to go ahead and make a Patreon page. You might not have hundreds of Patrons supporters, but if you're going to be doing the work anyway,

it doesn't hurt to also have the Patreon option. So lots of Patreon creators offer up access to their work in different ways, including ways that are free. So for them, the Patreon link is about giving fans the opportunities to support the work they like. But others actually have just specific stuff that only Patreon supporters of access to, so that creates an incentive for people to join Patreon so they can get at the stuff they otherwise wouldn't see.

And usually there's a balance between the two. Like I said, it's not normally the case that someone says, all right, here's a special web comic, but you only get to see it if you join Patreon, Otherwise you'll never see it. That's rare. It's more likely to say, I'm glad you like this web comic. If you enjoy it, consider supporting me on Patreon, and then in return you will get all this bonus material. That's kind of That's that's the more common way this this rolls out. And personally it's

probably clear. I love the idea of Patreon. I mean, I do support people, but I don't think I could actually use it for myself. Like I don't think I would create a Patreon campaign because I doubt I have enough of a following to bring in enough money to support the stuff I want to do outside of work. But for artists who are in a different situation, I

think it's a great tool. It gives people an alternative to advertising or to trying to do direct sales, and it gives fans a chance to be part of something that they love. So I think that's a win win for everybody. And again, as long as it's opped in, I'm cool with it. It's when it's when you require it that I start to say, well, that's less cool.

Now it's about time for me to sign off. But I believe I made a promise, or maybe the better word is a threat to treat you, guys to a little bit of my Renaissance Festival character in honor of the theme patronage, which in fact does have its origins in the Renaissance. So this is your opportunity to spare yourself the pain of hearing me be corny while speaking in a terribly inaccurate accent. If that's going to bother you, you might want to quit while you're ahead, because the

show is essentially over at this point. But for the rest of you, you have been warned. Lords send ladies, thou art most fortunate to this day, for thou dost find thyself in the enviable position of being within the presence of one Lord Admiral Edmund ving Lory, the third Commander of His Majesty's Navy Royal and member of the

Privy Council. And though it not me known by many, I be a distinguished patron of the arts, the man behind the purse, behind the theater, behind the pub, behind the times run by none other than the Lord Admiral's men. There thou mayest have had the glorious experience of seeing such unforgettable plays as Anything You Want to Love's labor

one and cats veterally. It doth please me to the ends of the earth to bring to the amusements and entertainments of such quality that audiences cannot help but to cry out in happiness when the doors be unbarred and people are allowed to go home. When next thou dost have need of a distraction from the plague, or a need a place to visit, because thy house is a fire, consider a voyage to the playhouse. I thank THEE and shall see thee. Ah No. That wraps up this classic

episode of text. Patreon again and other services like it that's one that I need to I can't do an update for a lot of these are you know, they've changed a lot in the past few years. And uh, some of that's due to changes in policy which have affected numerous creators. Some of it just has to do

with different trends in the marketplace. And um, yeah, it's it's been long enough where I think I could come back and revisit this this topic and talk about what has worked and what has not worked so well over time. If you would like to suggest a topic for me to cover in future episodes of tech Stuff, there are a couple of ways you can reach out to me. One is to download the I Heart Radio app, which

is free to download, free to use. You can navigate over to the tech Stuff page and push that little microphone icon that will let you leave a voice message up to thirty seconds in length, and you can let me know what you would like me to cover there, Or you can pop on over to Twitter. The handle we use for the show is tech Stuff HSW and you can leave me your suggestion there and I'll talk to you in again really soon. Yeah. Text Stuff is

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