Who and Why and How I'm Funding
I was having a long conversation about sponsorship models with my cousin Colleen as she starts to expand her own funding sources, and figured I should publish some notes on different funding relationships.
Recently, I have been getting more and more excited by the creators I see embracing a funding model that they can control and live on. I really want more creators to explore models other than advertisements mediated by the platforms they use. I think they are more sustainable, more profitable to the creator, and more rewarding for me (the sponsor/member/patron)!
Note that I'm specifically talking about funding individuals - people - not companies or organizations. Companies are excluded from this funding list because our traditional economy already has a lot of practice in sending money from individuals to companies and I don't think anyone needs to hear how I send money to film studios or tech giants. Only recently have the technology and patterns appeared that allow individual creators to generate income directly from their audience's pockets, without having to operate as a larger collective. They are starting to standardize, but many are still almost like folk creations of funding: bespoke, adapted from available tooling, local to their environment.
I have been taking inventory of the ways I sponsor individuals right now, and I've broken it down into a few categories: donations, sponsorships, patronage, and memberships.
Each has a different interaction pattern and different industries seem attracted to different models. I want to run through them in order of most passive (both from the audience and creator sides) to the most involved.
There are people to whom I donate a one-time amount as recognition or thanks. These have almost all been developers (maintaining open-source libraries) who published a tool I liked but don’t continually use. I have found all of them by finding and using their tool first, and then their donation page linked from that tool.
These donations are a one-time thanks for the work put into building their tool. The amount I give is informed by how much time I think they took to build it and how frequently I used their tool. There are many donation platforms I've seen over the years: Buy Me a Coffee, PayPal, KoFi, GitHub Sponsors, etc. but they all let the user specify a donation amount and let the creator nudge them with prescribed amounts.
This group has included many individuals over the years, but the most recent example of this funding was to send Sindre Sorhus a payment in recognition of their various libraries I use. I don't interact with the individuals in this group very much at all, as the funding relationship is a single transaction, and the tools/work I'm paying for are usually operating in the background. I probably sent ~$50-75 to this category of creators last year.
Personally, this is the only type of individual funding I've received to date for my own projects. It would be exciting to break out of this level one day (and will require more concerted effort)!
The next level are people I sponsor via recurring payment for their continued maintenance and continued creative work in the open. I find them by using or enjoying their work on a regular basis, and I recognize (either through reinforcement in the work or my own interest) the individual behind it.
Currently, these are all developers who maintain open-source libraries/tools that I use regularly for my own projects. I want to make sure they continue maintaining them and also develop new tooling that I can use. A good summary of how I want this funding to benefit these creators is summed up by Patrick McKenzie in describing his own sponsorship program:
[...] you can pay me money, and I will continue writing. If you (in aggregate) pay more money, you (in aggregate) will purchase more of my professional cycles, and thus tend to get more artifacts shipped to the Internet than if you had paid less.
Examples of my sponsorships as we enter 2023:
I'm currently funding people in this category through GitHub Sponsors, though I see more writers experimenting with Ghost-powered blogs which is exciting. I sent ~$75-100 to this category of creators last year.
With this group, I am thoroughly engaged with the creative work, but almost never engaged with the individual. I just love their work and want it to grow; I'm not unlocking anything or receiving anything that's not already a public good. I'm hoping to find more and more creators embracing this funding model in the coming year - it's the simplest to operate and allows them to spend more time creating. Tim Carmody calls this unlocking the commons:
Fans support the person and the work. But it’s not a transaction, a fee for service. It’s a contribution that benefits everyone. Free-riders aren't just welcome; free-riding is the point.
A third category contains people that I fund by purchasing their product or merchandise or archive or other output. There are many of this type in my list, and for many I've given more funding than a recurring sponsorship would have accrued (just because their high-quality products are usually expensive).
Others may word this as regular ol' purchases of products, but I think this relationship is closer to patronage: I enjoy their work and fund it by purchasing whatever they offer as a product. I find their products through their work; usually I find their work via referral or because they are an expert in a field I practice. I pay attention to anything they're doing, and actually engage with some of them on their topic of expertise.
These people are creators, and produce generally-available content (writing, videos, etc.) for free, but they offer branded merchandise or special products or collections of their work for purchase as well. I will purchase things from them because 1) I usually like/want what they are selling and 2) I want to give them money to keep making more of what I love. The productized version is also nice because it gives me a physical artifact that I can re-read or go back to or what not.
Examples from the last year or two include:
These creators leverage tooling like Kickstarter, Gumroad, Amazon Self-Publishing, bespoke publishing/bookmakers, or homemade payment collection and production tooling. I probably sent ~$100-300 to this category of creators last year (though sometimes it's much more - e.g. for workshops)
The final and highest-involvement category contains people that I fund by paying for a monthly/annual membership for exclusive access to their work. These people are artists, experts, or personalities and produce both generally-available (free) content of their work and also exclusive content for their members. I have found them because I value their expertise or perspective and I'm funding them to gain extra access to more of their work and/or their opinion.
Almost every individual in this group offers their attention back to their membership audience: member Q&A built into their programs, office hours, instant messaging groups, etc. Additionally, some offer pre-release access to their work to their members. People in this group also usually offer some physical products of their work or merchandise (not exclusive to the membership).
Memberships I'm currently funding:
Only for two of these did I immediately join their membership option upon discovery. For the others, I continued watching/reading the public work for a bit and then started paying just to give them money so they could do more of it - all of them position their membership programs as the only means of funding their public work as well as keeping them independent and happy and all that (they disable ads on their videos/website). I wanted them to continue, so I started paying. People in this group also usually offer some physical products of their work or merchandise (not exclusive to the membership) which I sometimes buy.
I usually don't think I will use the members-only features; I have been wrong every time. I always start appreciating the only-for-members things eventually and they’re worth the membership price on their own. Usually these are behind-the-scenes videos or Q&A sessions or extra videos or early-access-to-eventually-public things. And all of them offer the ability to actually interact with them to their members. I greatly appreciate getting to see how they work/think behind the scenes (usually because I want to learn from them).
People in this category leverage tools like Patreon, Memberful, Substack, or custom payment/membership solutions. I sent ~$300-400 to this category of creators last year.
This is a snapshot of my funding at this moment. I hope to revisit it in a few months or this time next year and see this list grow. Maybe a new category will surface! Usually, I see creators move 'upward' through these models as they become more successful. It will be interesting to see if that continues or more people start/stay in a category.
Most of these individuals were able to quit their corporate jobs with the funding from their audiences. I really want to fund some individuals (ahem, Matt Levine), but they belong to a company that either charges more than I'd like or do things I'd rather avoid. I'll be happy if I'm funding more individuals in the future.
Good thinking on this topic:
- I have collected notes under funding and sponsorship
- Craig Mod writes about his funding model evolution regularly
- patio11 writes about money and funding his work openly
- Van Neistat has published good thinking about a creator's journey through funding
- Nadia Asparouhova has published great research on funding science and open-source work