From my favorite newsletter the HUSTLE
Gold rushes are exciting — unless you’re the one with an empty pan at the end.Take it from startups built to serve creators, many of which are now coming up short on nuggets.But oh, what a rush it was Since 2021,
US businesses selling products and tools that support creators — the social media influencers who make the world go ‘round — have raised $8.6B+, per The Information.That hasn’t been the case lately — fundraising for the sector is down 90%+ this quarter compared to the same time two years ago —
and now some businesses are starting to meet their makers (to tell them they can’t help them produce viral content any longer).Since the start of 2022, 18+ creator startups have either been acquired or shuttered, according to The Information, and many more are running out of cash or pivoting away from creators.
What went wrong?
A few creators have done well (very, very well) for themselves, but most don’t make enough money to pay for specialty services.Companies were betting on the emergence of the fabled creator economy middle class, and that didn’t materialize:Only 12% of full-time influencers make $50k+/year; 46% don’t make four digits, according to Linktree — a creator company that aptly just shed 27% of its staff.
Of note: Creator opportunities are narrowing, but want to buck the trend? Figure out how to uncomplicate taxes for pet influencers and you’ll be internet royalty.