Early this month, Meta was mega.
November started with the #MetaCreatorDay in Gurgaon, New Delhi which was its last-city-stop in the nationwide creator celebration - an annual event by Meta.
In addition to all the fanfare, the team at Meta also released a commissioned report titled The Rise of the Creator Economy authored independently by Richard Florida - the new age economist, popularizing the idea of a creative class. With hyper-focus on the creators, Meta is pretty clear on its agenda - Let’s get to the next phase of this passion driven economy.
From rooting for creating a middle-class in the creator economy to making an attempt to predict what the future beholds, here are some of the key insights from the release:
1. The financial disparity has hit the creator economy as well
The numbers are an interesting read while assessing the economics of the industry. Take for example the economic value of the Creator Economy which the Report provides is estimated to be around $104 billion in 2021.
But if you look a little more, there are some thoughts worth pondering. An economic graph too similar to the real world, the virtual world indicates concentration of money.
The Report has some hard-hitting numbers. Take YouTube - a platform which has alone contributed >$25 billion in economic output but in terms of individual earnings, this number translates to a small figure of 4,25,000 full-time jobs.
The Report finds these numbers across the spectrum:
- Two-thirds of the total creators earn less than $25,000 annually
- More than a quarter earn less than $1,000
Creator economy has often been regarded as an offshoot of a need for artist independence. With Richard’s report, we see an irony that has developed where what once started as a way to reduce entry barriers and increase pay parity now seems riddled with the issues it started to resolve.
So while passion projects continue and many successes emerge on the internet, the statistics make you question if you can truly (and realistically) follow your passion?
2. Who all are investing in the creators?
With 300 million creators around the world, the industry is valued at $104 billion globally. Out of which India with 92 million creators has one of the highest number of them all globally. And yet a concentration of two-thirds of all global VC investment in Creator Economy Startups is in three US states - San Francisco Bay Area, Los Angeles, and New York.
Despite the comfort of the growth in the Indian homeland, Indian VCs seem reluctant. It makes us wonder the reasons for it? Do we not see potential in our creators or are we testing waters and waiting for the right opportunity?
Would you want-to-invest in the next “Born on Instagram” Creator?
3. What’s the next phase: Creating a “creator-middle class”
When one says “creator economy”, the follow up is, “Oh so, how exactly are you monetizing this passion of yours?”. But with the numbers, it’s unlikely that every second creator is going to become a millionaire on the internet. Does that mean we are going to see the bubble-burst soon?
Richard shows concerns of a stagnation, if not a complete burst. But more importantly, he raises an immediate need to mend some ways in which this virtual economy is functioning, to ensure its survival: by turning back to the traditional economic forces.
Reduce concentration of power (and money), bring in the government to support the creator and most-importantly move towards creating a self-sustaining creator middle-class - the one that survives between the extreme success on Instagram and the disappointments of TikToks.
The true test of the creator economy is a system that's more democratic and makes attempts in distribution of money on the internet. Richard Florida feels the only way to do this is by creating the creator a middle-class.
What do you think?
