From the outside, the creator economy looks flush. CAA launched a $250 million venture to buy creator-led businesses. Live Nation started Creator Nation to acquire management firms. OnlyFans sold a 16 percent stake to Architect Capital for $535 million at a $3.15 billion valuation. Capital is clearly interested in creators.
For individual creators, it’s another story. A recent industry analysis explains that most creators are building brand capital without financial capital. It’s not that they aren’t running real businesses. They are. Just without traditional access to funding. Instead, they are using their voice, visibility, and community trust as their only leverage. The Interactive Advertising Bureau projects that U.S. creator ad spending will reach $44 billion this year, and 48 percent of creator ad buyers now call creators a “must buy.” Yet the people producing that value often front the costs before anything is paid.
Sprout Social got a glimpse of that at this year’s Cannes Lions. The company received about 300 submissions from creators attending the festival, many of whom had paid their own way and wanted help turning the trip into income. Plenty described it as a bet on themselves. Curtis Midkiff, Sprout’s director of social media marketing, said creators are asking for “more tangible long-term relationships.” Creators, in other words, are doing the work of small-business owners without the funding that usually comes with it.
Amanda Estiverne of the National Alliance for Financial Inclusion explained it in even more detail. Creators, she says, manage multiple revenue streams, invoice brands, sell products, take cross-border payments, and hire teams, all without a regular paycheck. And traditional lenders do not like this kind of set-up. That’s why so many creators rely on themselves: they can’t get traditional funding. Fintech companies are beginning to notice. Stripe powers creator payments and platform payouts, Mercury offers banking for digital-first businesses, and Karat is trying to underwrite creators by looking beyond credit scores. There are even startups like CloutScore that are building tools aimed squarely at creator-led companies.
It’s one reason that so many creators have a day job, or at least a second source of income. A CreatorIQ survey of more than 5,000 creators found that creating wasn’t the primary income for 62% of respondents. Brands say they value fit, but follower count still correlates most closely with income. Lenders, like advertisers, tend to reward whatever is easiest to measure. For most creators, that means the capital that’s flooding the creator economy isn’t reaching them. It’s reaching the buyers, the platforms, and the few at the top.
That’s where the conversation about ownership becomes a conversation about capital. When CAA’s Compound or Live Nation’s Creator Nation buys a creator business, the creator gets funding in exchange for equity. Megan Fox’s new Subs.com page comes with a co-ownership stake in the platform. Sydney Sweeney took an equity stake in the betting company she advertised. Money is available to creators who are willing to trade ownership for it. The open question is whether they can borrow instead, like a bank customer, without giving up ownership.
OnlyFans is an interesting example of the capital problem. Architect Capital said when it bought its stake that it would help the platform expand financial services for creators, citing their limited access to traditional banking products as a driver of the investment. That’s a pretty direct admission from an investor. But it’s true: the creators who built OnlyFans have faced financial barriers for years. There are so many stories of OnlyFans creators being debanked that it was originally cited in a federal report, though the most recent one curiously omitted the industry it previously was going to help.
It seems the new creator capital is arriving in three forms: acquirers who want equity, financiers who want content as collateral, and fintech firms that want the payments business. Sure, it is progress. But none of these really help the creators themselves, because they still can’t get a loan when they need it.