Patreon is introducing a new service fee designed to benefit creators, but many users worry it will make patrons more reluctant to pledge.
For those who aren’t familiar, Patreon is a subscription-based crowdfunding platform where “patrons” pay either per post or a monthly fee to artists, musicians, writers—anyone who falls under the term “creator.”
The site previously charged creators a flat 5 percent fee for every payment they received. The fee, on top of the charges from payment processors like Stripe or PayPal, meant artists would lose 7 to 15 percent of their earnings right off the bat. A new payment scheme hopes to reduce those losses, giving creators exactly 95 percent of each pledge they receive.
“Creators often take home a lower percentage of their Patreon income than patrons may realize,” the company wrote on its site. “Standardizing our fees across the board provides consistent expectations and more money for creators on Patreon.”
Starting Dec. 18, patrons will be charged 2.9 percent plus 35 cents per transaction, regardless of the amount. At first glance, that may not seem too bad. A single $20 pledge would cost a patron just $20.88.
The extra cost isn't tiny if you pledge small amounts to many creators. Pledging $100 to 1 creator will now cost $103.25 which is reasonable. Pledging $1 each to 100 creators will now cost $138 which is not reasonable.
— TPRJones (@TPRJones) December 7, 2017
But that seemingly innocuous charge could have a huge impact on those who pledge small amounts to many users. Consider a user who pays 30 creators a monthly $1.00 subscription. Now, that patron will be charged roughly 1.38 per charge per creator for a total of $41.40.
The new payment system is already being criticized by creators and patrons alike, who fear the higher returns will be offset by a substantial decrease in the number of patrons making pledges, particularly those who typically pledge a few dollars. Comic writer and Patreon creator Gibson Twist posted to Twitter to say the changes will likely result in him shutting down his account, “I’m not interested in gouging my audience in something I don’t believe benefits me or them at all,” he writes.
https://twitter.com/GibsonTwist/status/938506297690992641
https://twitter.com/GibsonTwist/status/938507168105619466?ref_src=twsrc%5Etfw&ref_url=https%3A%2F%2Ftechcrunch.com%2F2017%2F12%2F07%2Fpatreons-new-service-fee-spurs-concern-that-creators-will-lose-patrons%2F
https://twitter.com/GibsonTwist/status/938502198752874496?ref_src=twsrc%5Etfw&ref_url=https%3A%2F%2Ftechcrunch.com%2F2017%2F12%2F07%2Fpatreons-new-service-fee-spurs-concern-that-creators-will-lose-patrons%2F
Many creators say their shows rely on small payments to stay afloat. In fact, several creators wrote that they would prefer to take the charges on their end than have them applied to patrons.
Dear @Patreon, I will happily continue to eat the monthly costs of using your site; that's part of my responsibility as a creator. Why are you passing that burden on to my Patrons?
— Der-shing 德馨 Helmer 🍉 (@shingworks) December 6, 2017
https://twitter.com/TheBreeMae/status/938527161094258689
https://twitter.com/tthcomic/status/938485405116182528
Small shows like ours get support from listeners paying a few bucks a month from fans. Many creators believe this will shrink the number of shows people will be willing to support.
— Todd Faulkner (@ToddFaulkner) December 7, 2017
Both creators and patrons worry this will discourage people who only have a few dollars to spare from pledging altogether.
Hey .@Patreon, adding a service fee patrons have to pay with their pledge unfairly targets people doing their best to support creators with what they have. I’ll keep paying the service fees if that means more can afford to pledge. Don’t make this harder than it already is.
— Ayme 💖💜💙 (@Catcoconutart) December 6, 2017
Every person with a patreon: please pledge even just $1 it really helps!!@Patreon: we have decided to make it economically infeasible to pledge just $1
— badidea 🪐 (@0xabad1dea) December 6, 2017
I would LOVE that if it was an option! I wish they had told us earlier.. We could've given them feedback like this sooner. There is a reason why creators like myself have 1$ tiers, because like you said, that could be all some people can spare. @Patreon @PatreonSupport https://t.co/hmSuyD6fZW
— Sam (@sambeawesome) December 7, 2017
The changes to the service fee come at a risky time for Patreon. Last month, Kickstarter announced Drip, its subscription-based crowdfunding service and direct competitor to Patreon. The two services are similar, except Drip projects start with “Founding Members,” a 30-day period where creators offer their first subscribers rewards or offers. Many Patreon users are now threatening to move to the new platform.
https://twitter.com/TsundokuPuzzle/status/938774125295812608
Hey @drip – how does a show get in line to sign up for your service?#podcast@uncannycounty
— Todd Faulkner (@ToddFaulkner) December 7, 2017
We have reached out to Patreon and will update this article if we hear back.
This article has been updated for context and clarity.