Patreon: $60 Million Series D Funding And Over $1 Billion To Be Paid Out To Creators By EOY

By Amit Chowdhry ● Jul 19, 2019
  • Crowdfunding membership platform Patreon announced it has raised $60 million and it is planning to have paid out over $1 billion by the end of the year.

Patreon — a crowdfunding membership platform that offers business tools for creators to run subscription content services — announced several milestones this week. The company announced it raised $60 million in Series D funding led by Glade Brook Capital. Patreon CEO Jack Conte unveiled that the company is on track to pay out over $1 billion to creators by the end of the year. And Patreon was also added as a new inductee on Forbes 2019 Next Billion Dollar Startup List.

Existing investors Thrive Capital, Initialized, Index Ventures, DFJ, Freestyle Capital, Charles River Ventures, and Otherwise also participated in this round. Comedian Hannibal Burress and musician Serj Tankian also made personal investments in the company. Including this round, Patreon has raised $166 million total.

This round of funding will be used for growing internationally and supporting currencies besides U.S. dollars and translating the platform to other languages. And the funding will also be used for integrating with more platforms via the Patreon API, adding more premium features, more page customization features, and the expansion of the fulfillment of merchandise for creators.

“Memberships works,” said Conte in a blog post. “By the end of this year, we’ll have the true honor to say we’ve paid out over $1 billion to creators worldwide, and we’re ready to step it up even more with this series D.”

Patreon hit 3 million patrons as of January who are supporting more than 100,000 creators with recurring payments, according to Variety.

“When (Sam Yam) and I launched Patreon, it was in response to a broken system where creative work on the internet was being used to funnel massive profits to big companies without valuing or rewarding the creators. This core problem has only intensified despite others launching Patreon-like membership features. Yet the fundamental system remains broken; other companies still continue to prioritize advertising dollars over creators,” added Conte in the blog post. “Meanwhile, creators have many options when it comes to sharing their work and cultivating a following on the internet, but few opportunities to obtain and enjoy consistent income. Patreon fulfills a unique need for creators, leveraging the deep, personal connections they’ve fostered with their fans to get them paid for the value of their work. This is not a new concept; this is membership by Patreon. And it’s working.”

Patreon earned $35 million in 2018 revenue. And while Patreon did not reveal its most recent valuation, the company was valued at $450 million as of September 2017 (Pitchbook)

As a former musician, Conte was inspired to launch Patreon after having a hard time reconciling the amount of effort he put into his work. “I was working on a music video for over three months. I maxed out two credit cards producing it. I went all out and only made $150 bucks on ad revenue from YouTube for it,” said Conte via Forbes. “I couldn’t stomach that millions of people viewed that video and that was all my paycheck was.”

Conte told Forbes that within two months of launching Patreon, he started making $6,000 per month for his work with the support of the “patrons.’

The creators of Patreon essentially select one of the platform’s three tiers: Lite, Pro, or Premium. And patrons can opt into the customized options for receiving certain perks. Patreon generates revenue by taking between 5%-12% of the monthly payments paid to creators depending on the tier that was selected.