TL;DR — Today, we’re launching Podhero: a subscription service that supports podcast creators. Each month, your $5.99/mo subscription gets divided and shared with the shows you support. Podhero works with 1,000,000+ podcasts from 30+ countries, we don’t take a cut, and you can try it free for one month.
Podcasts Have a Big Problem
Our team’s first venture into podcast problem solving was a social podcast player called Swoot. Our idea: the best way to discover podcasts was to see what your friends were listening to. We launched last year, enjoyed great retention and passionate users…but we soon realized there were bigger problems for creators and listeners alike.
So, we interviewed and surveyed a lot of podcasters to understand their problems. Across the board, almost without exception, they all said the same thing:
It’s really hard to make money.
You’ve probably heard ads on podcasts before. You’ve probably heard creators ask for financial support before. It seems like there are ways for podcasters to make money, so why is it so hard?
97.2% of Active Podcasts Make $0
Podcasts usually make money in one of two ways: advertisements or listener support. Podcast ads, as you probably know, are short 15–30 second spots sponsored by a product or service. Listener support is when fans make monthly contributions directly to creators. The figures below are estimates based on the latest data as of June 1, 2020.
- 1.4% of podcasts (14,000 shows) have ads or sponsors.
- 1.4% of podcasts (13,800 shows) monetize listeners on services like Patreon.
- 97.2% of podcasts (972,000 shows) make no money at all.
Well, this doesn’t match the happy narrative I had in my head. Why do only 1% of podcasts have ads? Why don’t more shows ask listeners for support? Here’s what I learned.
The Trouble With Ads
In the eyes of advertisers, 99% of podcasts are too small for ads. And even once your show is “big enough” for ads, new problems emerge.
- It’s a ton of work — For being a modern medium, the advertising ecosystem is surprisingly old-school. You deal with big ad firms, negotiate deals, negotiate ad copy, negotiate price, verify ad placement, record the ads, and report stats back to advertisers.
- Only the biggest — Ads require so much work that advertisers don’t bother with small shows. For them, podcasts with under 5,000 downloads per episode aren’t worth their time. Some creators put that number at 40,000. Whatever the number, most podcasts can’t make money with ads.
- The ads choose the shows — Only a handful of podcasts can literally afford to be picky about sponsors. Most shows take what they can get.
- Ad revenue is unpredictable — We’re learning this in real time; Covid-19 came along upturned every aspect of our lives. Businesses tend to stop advertising when there’s economic uncertainty. They focus on weathering the storm, not attracting new customers.
We Need to Talk About Ads
I really want podcast creators to get paid. I almost don’t care how it happens. Almost.
I have a real problem with ads. I like that they pay podcasters, but I hate having my attention stolen and sold. Some companies sell advertisers your listening history (music and podcast) along with sensitive personal info so they can target you more. What company? It’s not hard to spot if you try. 🧐
I’m not cool with any of that, and I’m not alone.
Advertising has been replaced by the almighty monthly subscription. Users pay a monthly fee in exchange for ad-free content:
- 48% of households pay Netflix for ad-free shows — creators get paid
- 51% of Spotify users pay for ad-free music — creators get paid
- If 50% of podcast listeners paid for ad-free shows — creators would make $3.7 billion/year, nearly 6x more than ads made in 2019 ($678m).
I know there are differences between these mediums, and the math is fuzzy enough to be a hamster, but subscription services are the most fair and predictable way for creators to make money.
So, why isn’t there a service where you can support podcasts in exchange for ad-free shows? There is! Thousands of podcasts monetize their listeners with Patreon…but there’s a problem here too.
Patreon Isn’t Designed for Podcasts
If you’re unfamiliar with Patreon, it’s “a membership platform that makes it easy for artists and creators to get paid.” It’s used by creators of all types: artists, writers, musicians, and more. Creators ask fans for monthly support and fans receive bonus content or other incentives. Everyone on our team has supported a Patreon creator at some point. I love their mission and team, but Patreon is simply not well suited for podcasts.
- It’s too much work — To get started with Patreon, you register your subscription business, create tiers for support, create extra content for those tiers, write emails and marketing copy, launch your campaign, and persuade listeners to support you. It’s a lot of work…for people who are already doing a lot of work.
- Patreon takes an 8% cut — I’m not going to critique Patreon for making money, but the 8% cut isn’t well received by creators or supporters.
- Pressure to make bonus content — It’s common for creators to make extra content to justify being supported. They shouldn’t. And most podcast fans agree: 92% of surveyed listeners expect nothing in return for supporting a podcast.
- Asking for money is hard — We asked podcasters why they didn’t use Patreon. Their #1 answer? They weren’t comfortable asking listeners for money.
- Most podcasts aren’t on Patreon — 1.4% of podcasts use Patreon. Even if you wanted to support your favorite shows, it’s unlikely that you could.
- High friction for multiple shows — Patreon isn’t connected to the apps where people listen. To support podcasts on Patreon, you go to the website, search for shows, and if they’re available, manually subscribe to each one.
- It’s expensive — Podcasts ask for ~$5/mo on Patreon. On average, people subscribe to 8 shows. That’s $40/mo. 400% more than Netflix or Spotify. Personally, I have 101 subscriptions (nbd). That’s a cool $505/mo. 🤑
Our goal is simple: to help podcast creators get paid. Podhero is a subscription service that does just that. Each month, your $5.99/mo subscription is divided and shared among the shows you choose to support. Podhero isn’t just a new way to support podcasts, it’s a brand new way to listen.
I know what you’re thinking: “the last thing planet Earth needs is another podcast app”. Well, we agree — you can keep your current podcast player.
We just think you won’t want to.
The Podhero app combines powerful social tools with features you’d expect from a world-class podcast player. Connect with your friends, see shows they recommend, and engage with your favorite podcasters.
- No registration required — There’s no need to claim your show before listeners can support you. We’ll send you an email when they do.
- We don’t take a cut — We’re proud to charge podcast creators zero fees. Instead, we ask listeners to support Podhero for $1 per month ($4.99 for podcasts + $1 for Podhero). We’ve made the $1 Podhero support optional, but without it, we won’t be able give creators the tools they need to be successful.
- No bonus content required — Listeners want to support podcasts for the work they’re already doing. We’re going to let them.
- Get more listeners — Listeners on Podhero have the ability to “recommend” episodes. Their followers get notified and might give your show a try. You also get a payout boost for each recommendation.
- Spread the word — It’s hard to ask listeners for support. With Podhero, you’re able to say “Podhero helps support not only this show, but all of your favorite podcasts”. You get to help other podcasts get paid, and they do the same for you. The rising tide lifts all boats.
- Get recession proof-ish — Podhero gives you a more dependable revenue stream, no matter what’s going on in the world. 😷
- One subscription, every podcast — Support all of your favorite podcasts with one $5.99/mo subscription. Each month, your $5.99 gets divided up and shared with the shows you support and recommend.
- Works with all shows — Podhero works with 1,000,000+ active podcasts from 30+ countries. If a show is missing, please let us know.
- Life after ads — Podhero won’t make podcasts ads disappear overnight. When creators get enough support, however, they can rely on them less.
- See what friends recommend — Follow your friends and see shows they support and recommend. It’s by far the best way to discover new podcasts.
- No contracts, no commitments — Give Podhero a try for 30 days. Cancel anytime before your trial ends, and you won’t be charged. Cancel online, anytime.
- Privacy and security — We hate the idea of our information being bought and sold. We assume you hate that too. So we treat your information the same way we would our own: respectfully, and with the highest level of security.
Give Podhero a Try
- Ready to start supporting podcasts? Try Podhero for free.
- Are you a creator? Claim your show to get started.
If you have any questions or feedback, please don’t hesitate to contact us.
One More Thing
I truly hope you love Podhero. I hope you love supporting your favorite podcast creators. I hope you love discovering new podcasts with friends.
But if you don’t, please let us know.
Podhero is a big idea. Big ideas require taking risks. We won’t always get things right, but with your feedback, we can always make it right. If Podhero succeeds, it will have been with your help.
Thanks for reading, and if you’re able, please support your podcast creators.
Founder & CEO at Podhero