Making a Living as a Creator
I recently read two great articles that got me thinking about what may be a helpful and productive way to approach making a living as a creator, which is a dream for many people, myself included.
The first article, by Brian Alvey, discusses the popular idea that to make a living as a creator you only need 1,000 true fans, from whom you can make $100 per year into perpetuity, generating an annual income of $100,000.[1] He discusses some of the problems with that model, and also mentions some alternate models, such as 5,000 fans paying you $20 per year.
What if we took this thinking to its logical conclusion and constructed an illustration similar to the one in the second article, by Christoph Janz? In the article he discusses different ways for enterprise SaaS companies to get to $100 million in recurring revenue, because assuming you can attain a 10x revenue run rate multiplier you get to a $1 billion valuation and become a so-called unicorn.[2]
Using our $100,000 pre-tax annual income target, we get the following:
Note the log scales.
Depending on your desired income level you can shift the curve in or out, and begin to think about what combination of revenue streams (because you should have more than one) will get you to your target based on the various ways to monetize different types of art.
Some pure play examples going from left to right down the chart that put you in the ballpark:
- One very rich person buying one of your paintings at auction for $100,000
- 1,000 true fans paying you $100 on Patreon or Recurrency
- ~14,000 people buying your self-published eBook for $9.99 (before Amazon’s 30% cut)
- ~110,000 buying your independently-produced $1.29 song on iTunes (before Apple’s 30% cut, assuming you’re a solo artist)
- 1,000,000 people reading your blog or watching your YouTube channel once every two weeks resulting in 26 million ad impressions at a net eCPM of ~$4 (you can extrapolate this as far as you want)
- ? people doing ? to generate $? from your content on Medium :)
Note you don’t necessarily need the same fans each year, as long as you have the desired number supporting you in the specified way.
This all probably seems rudimentary, but it can still be useful to explicitly lay something out. It may become increasing difficult to make a living as a creator in the future as we start competing with machines, but in the meantime I hope this helps someone achieve tangible progress towards making creating as a living work for them.
Notes
[1] No comment on that number from someone who lives in San Francisco…
[2] At the time of writing this there are many companies with “valuations” based on much higher multiples, but enough has been written about that elsewhere.
