And the last bucket contains ways that creators can make money. From Gen Z VCs with social media audiences of their own to firms investing directly into content creators themselves, Insider narrowed in on 13 standout venture firms. BBG Ventures is a VC firm that focuses on making early-stage investments in companies that have at least one female founder. The company formed in 2019 as a merger between M Ventures and Nichols Cross Culture Capital. The two founding partners are in their early to mid-twenties, and BGV focuses on early-stage startups, funding preseed and seed rounds.
Being one himself, he understands the struggles of creators and influencers in the economy very well.
"We'll continue to look for good deals.". However, in the first quarter of 2022, funding had dropped by 30% within the creator economy. Danielle Lay, Investor at NEA, says, "Creators can move from fee based compensation to building wealth through equity in the communities they build.
Not only does it provide the opportunity for creators to offer more to their fans (including financial upside), but also for both creators and their communities to finally be able to participate in the collective value that they help platforms create. The creator economy consists of people who, just like any of us, have a passion, or a hobby that they can monetize online. Coming soon: Diving deeper into Go-to-Market Tactics and Strategies in Web3 #watchthespace. "We're investing in tools that help creators to seize the means of distribution," Josh Constine, a venture partner at SignalFire, told Insider. Mac Venture Capital invests in creator economy companies like Brud as well as digital media companies like Blavity. Despite a potential economic downturn, Lightspeed Ventures continues to forge ahead. Ludlow Ventures is a VC firm based in Detroit that has invested in 100 Thieves (a gaming and lifestyle brand that is also backed by Drake and Scooter Braun). Thats what investors would want to see. MaC Venture Capital is a VC firm focused on seed-stage investments in tech and media startups. Fatemi, meanwhile, worked at Bain Capital Ventures before stints as an early Clubhouse and Wave.TV employee. Web3 is a mash up of 3D worlds, social gaming, NFTs, and virtual goods ownership. Oops! We are excited about the untapped potential of the new Web3 creator platforms and creators tools that enable these new direct creator-community relationships and that are built for the mainstream consumer, unlocking the next 100 million users in Web3. ", Relevant startups: Metafy, FORA, dumpling, Investors: Jarrid Tingle, managing partner, Founded in 2015, Harlem Capital is a VC firm with a mission to invest in "1,000 diverse founders over 20 years.". In June, the company said it had $412 million in assets under management. However, evaluating a team that builds in Web3 is not so straightforward. Brian O'Malley is a Silicon Valley veteran who has spent time working at both VC firms and startups. They can now clearly see which way the wind is blowing when it comes to the creator economy and they want in. It removes intermediaries from traditional Web2 aggregators and gatekeepers, which is key for the democratization of income creation in the digital world.". However, this doesnt come as a surprise given the differences in the two consumer markets. Located remotely, with its general partners split between Los Angeles and Dubai, CreatorLed is powered by a team of limited partners who double as content creators. Box Group invested in multiple social networking companies and creator-based startups like Brat TV, Byte (a short-form video app), and Clubhouse. The American Dream promotes the idea of the US being the land of opportunity and a high-risk, high-reward mindset is seen as a virtue. For example, the typical music artist on a streaming platform earns about 10% of their entitled royalty with the rest going to the record label. 
It's a cliched thing to say but it is 100% true. "They make so much of the great content that entertains and educates us, but the social platforms tend to be the ones that make all the money," Lee told Insider regarding creators. In Web3, the alignment of incentives through stakeholder primacy means that the entire community of contributors making up a network are turned into stakeholders - driving the need for new distribution strategies.
Now, for founders who are looking to build these new creator platforms, information on what investors are looking for and tips for how to ace their fundraise can be scattered, inconsistent and overwhelming. Night Ventures, an early-stage fund based in Texas, was founded in 2021 and is part of Night Media, a talent management firm that represents social media creators, including MrBeast. "We're not pausing investments at all," said Saaya Nath, vice president at venture firm Jump Capital. Often people are holding crypto but not transacting with it (however, a crypto game token or community platform should have higher activity rates and transaction counts) so this number should be significantly larger than the daily average of users. Blockchains are already starting to operate the backends of many software applications and, as part of Web3, have more potential to influence how we interact with the internet than mobile and the cloud did. You can read the full article from Business Insider here. That way you're not starting from scratch with your fanbase, and can reward folks who have been with you from Day 1., The lifecycle of a creator. He's especially interested in creator economy companies that are focused on helping creators build businesses. After writing "Seed to Harvest" a children's book about venture capital during the pandemic, Paige Finn Doherty began building her portfolio of investments, as well as a community on Twitter of more than 30,000 followers. Discover more articles like this on the Speedinvest Blog. MaC Partner Zhenni Liu said she similarly focuses on companies that simplify the experience of running a business as a creator. In the case of Mirror.xyz, you now have the opportunity to invest at the earliest stages of a publication in exchange for a token or NFTs so you effectively have ownership in that.. In CRV the two sisters invested in Kapwig, an online video, image, and gif editing tool for creators. Latest fund size: $5 million, as of December 2021, Relevant investments: Beacons, FYPM, Super Fans, Bloom, Investor: Eric Kullberg and Blake Michael, general partners. The New Creator Economy: A Guide to Web3 Creator Platforms, how we spend our time is becoming an investment decision, A map of the 144 creator economy platforms leading the way, 100+ VCs investing in the creator economy, A fundraising guide with key points investors look at when analyzing companies, An overview of some of the opportunities and challenges facing investors and creators, A 180 or 90-day trailing average would be used for a stable mature network, A 30 or 7-day average would be better for real-time insights, but are subject to false signals due to market volatility. Therefore, what this means in practice is that, while Web2 businesses GTM strategies start with the product (i.e. This sometimes leads to creators working insanely hard for not a huge amount of upside - it is important we take care of ourselves.. This can be seen by the big rounds raised by companies including: Web3 is attracting more and more attention but from who? We exclude very large mainstream companies - like Patreon, Snapchat, etc. The principal of Index Ventures Rex Woodbury is also an influencer with 230k Instagram followers and has a newsletter about internet culture. Total Number of Addresses, Addresses With Balance, Zero Balance, Zero Balance Ratio: This data indicates the lifetime population of users and the protocols retention.
Businesses like these are sprouting up across Europe every week. Web1 refers to the first, static version of the web, also called The Information Economy. Index Ventures investments in the creator economy: Alexa Von Tobel (managing partner at Inspired Capital) has a background in fintech. Seven Seven Six is an investment firm founded by the co-founder of Reddit Alexis Ohanian. Finding the balance of producing really good content that we love and making an income is really hard as we need to pay the bills. I'm excited about three main segments: 1) creative tooling, 2) creator discovery, and 3) creator monetization. So it is becoming an investment decision. Alexis Ohanian (founder and general partner) is best known as the co-founder of Reddit. However, we believe everyone will be a creator eventually in some capacity, says Ollie Forsyth, Global Community Manager at Antler. Platforms are becoming community-led, making it easier for both creators and their audiences to profit from their contributions. In exchange for buying a percentage of an influencer's future profits for a set amount of time, Slow Ventures gives the creator capital up front. Overall, stronger loyalty. Founded by investor Chris Farmer, venture firm SignalFire has made several big creator economy bets since its founding in 2013.
This list was determined by Insider based on our reporting and the nominations that we received. From an economic perspective, this especially applies to how we create and transfer value online. Creators became reliant on platforms who were the new de facto gatekeepers of the internet. Speedinvest fundamentally believes that Web3 is a technology that will redefine all verticals in the economy. The Information recently reported quarter-over-quarter funding dropoffs among the companies featured in its creator economy database, which includes NFT and crypto brands like OpenSea and Audius. ", Total committed capital: $18 billion-plus, as of July 2022, Relevant investments: Cameo, Gumroad, Moment House, Superpeer, SuperJoy, Investors: Michael Palank, general partner; Marlon Nichols, cofounder and managing general partner; and Zhenni Liu, partner. We're seeing NFTs, social tokens, and other new Web3 innovations reinvent monetization., Creator longevity. For this reason, we decided to ask a few investors for their thoughts on what they pay attention to when analyzing potential investments in the space.
For the equity to sustain value for both the creators and their communities, platforms will need to help creators design tokenomics. "We work with not just the greatest creators that we could possibly find, but also the teams that surround creators that make them massive online giants," Herrera told Insider. He is a seed investor in Substack. current debates around rich-poor divides in Web3 gaming), which is crucial for long-term creator adoption. This is the opportunity we see for the new community-led creator platforms, their ability to create self-sustained networks and fairer ecosystems where people serve each other and the community as a whole. Nath joined Jump Capital, a Chicago-based venture firm founded in 2012, as a vice president in October 2020. Niko Bonatsos, Investor at General Catalyst, comments, The same way that Silicon Valley became a mindset and millennials from all over the world realized that tech entrepreneurship can be a career option, Gen Zers, for the very first time, can now earn a living from their ingenuity online..
Not only are they growing at a high pace, but they are also receiving serious investor interest and capital from both European and North American investors. This often results in limited revenue opportunities, such as merchandise, subscriptions, ad revenue or tipping which unfortunately are, in practice, only sustainable for the top 1% of creators who have amassed large followings. Finally, we turned to the main actors in this new iteration of the space and asked a few creators what they are most excited about and what challenges they may face in the future - and here are their answers: Deeper and longer-lasting relationships - across platforms. Night Ventures is the early-stage fund of Night Media (a management firm for creators that manages some of the top creators like YouTuber MrBeast). I am most excited about platforms that enable creators to create meaningful engagement with their audience without having to be on an endless content hamster wheel. Once you're done with this, check out our guide on Web3 go-to-market tactics and strategies. The idea of an everyday person earning a consistent income from making YouTube videos is no longer a laughable daydream - its a proven business model, says Paola Vivoli, Investor at Speedinvest, This has already started to attract the attention of B2B startup founders and investors in Europe. The game has to be really good after all! Theres a lot to figure out - but access, inclusion, and awareness feel like important next steps. It just has a little catch up work to do to reach the same level of maturity as our friends across the pond.. To this point, it is important that founders tailor their GTM strategy to the community they are building for. Of course, this business strategy makes sense if we keep in mind that the quality of content on a platform defines the platforms value and is directly responsible for attracting and retaining millions of users. However, as platforms improve discovery and creators become more accustomed to owning their financial relationships with fans, the middle class of creators are set to be rewarded as well., Sustainability and longevity. This includes the likes of Andreessen Horowitz, Greylock, Bessemer, Northzone and Atomico.
"I'm excited about platforms that have cracked the challenge of distribution and monetization as well as provide tools that make it easier for creators to create, distribute, and earn money without too much friction on creators' existing workflow," she said in a statement. Marlon Nichols, the firm's cofounder and managing general partner, said he looks to invest in companies that help creators focus on creating without having to worry about protecting or monetizing their work.
Today, investors typically believe / expect 'crypto-native teams to have a better position to build and win in this space over teams building social / consumer/ game-first startups.
Consumers are increasingly moving online, pouring their attention and $$ into mobile as we head into a mobile-first economy. And part of an economic downturn means those deals may bemore favorable for investors, as valuations reset to what is perhaps a more realistic level. ", Investor: Brian O'Malley, managing partner. Our focus goes to the opportunity at the intersection of consumer and crypto. In this market map, we focus on the new Web3 creator platforms that not only enable creator (and community) ownership but also ensure a fairer and circular distribution of benefit to all of the contributors of the community. Andreessen Horowitz is a VC firm that made some very successful investments on creator economy startups. 2021 was a pivotal year for the sector as Web3 took all sectors by storm.
With that in mind, we expect the European ecosystem to continue to grow. The most crypto-native founders are not necessarily the right ones to build some of these new creator solutions which, depending on where you sit on the landscape, actually mostly resemble consumer apps. Silvia Oviedo Lopez, Head of Marketplace at Canva, says, I think that the community angle is going to be the most interesting [part] over the next little while and really brings a new lens to the creator economy. It was recently announced that the firm would give $20 million to creators upfront in exchange for a percentage of their future profits. ", Assets under management: $80.7 billion, as of September 2021, Investor: Katelin Holloway, founding partner. Remember, 80% of users might just be lurkers. Jess Lee, who previously served as CEO and cofounder of fashion app Polyvore, is a partner at Sequoia, as well as the firm's Chief Product Officer, leading engineering product, design, and data science. Started in January 2022, CreatorLed Ventures is an early-stage firm founded by general partners Blake Michael, a creator (and former Disney Channel star), and Eric Kullberg, a former banker and creator talent manager.
Sukhinder Singh (founding venture partner).
Weve reached out to the wider ecosystem to provide you with a clearer overview of who is investing in this space, including their stage, geography focus and cheque sizes. Speedinvest is supported by InnovFin Equity, with the financial backing of the European Union under Horizon 2020 Financial Instruments and the European Fund for Strategic Investments (EFSI) set up under the Investment Plan for Europe. So much of the current disruption within this new creator economy is in the distribution mechanism where you create and capture value and then redirect it to the core community, your earliest supporters, in acknowledgement of the value that they provide. It is run by Peter Chernin, Jesse Jacobs, and Mike Kerns and the group has invested in social media-focused companies as well as esports, gaming, and health companies. We are now seeing a fight between the platforms as to who can pay their creators the best. We can look to monetary policy to understand how tokens need to be managed. Justine and Olivia are two venture investors at CRV that focus on seed-stage and Series A stage companies.
She is the founder of LearnVest (a fintech startup that raised $350 million in 2015) and has written two books on the subject of fintech. "If you're a startup building something that medium-to-large size companies and creators need to be able to operate their business, there will always be a place for you," Constine said. Floodgate is a VC firm that mainly invests in early-stage tech companies. To make matters worse, platforms today take too big a share of the income creators generate. Kevin Gould founded and is the CEO of the creator-focused investment company Kombo Ventures in 2012.
The aim of this list is neither to be exhaustive nor to rank startups, but rather to chart the rapidly evolving and expanding creator economy startup ecosystem. And thats exactly where he specializes. The new creator economy encompasses everything creators have always craved - ownership and community led platforms where all community members are compensated for their time and contributions.
"For us, really what it comes down to is backing founders that have exceptional product intuition, and a lot of them have had experience as creators themselves," Fatemi said. We predict that things will get back on track soon, especially because investors are fueling startup companies as we speak.
With more than 230,000 Instagram followers and a weekly newsletter read by over 25,000 people, Rex Woodbury is an influencer in his own right.
Creators are now in the drivers seat, being offered the opportunity to have greater control and individuality than ever before. You can now earn money by playing a game (e.g., Axie Infinity, Sorare) and, by doing so, you are now making a decision with your time. Latest fund size: $174 million, as of March 2021, Relevant startups:Atomize, Drip, Mueshi, Primitives.
Harry Stebbings, Founder of The Twenty Minute VC and 20VC fund, says, "Seeing more value captured by users, both individually and collectively, is one of the most exciting aspects of Web3. With this knowledge, he started his investment fund which strictly focuses on the creator economy.
When we look at the data, it becomes clear that the creator economy is, by far, the largest in North America. The firm has raised over $400 million in funds. North Americans, especially in the US, are generally less risk averse than people in Europe. ", Relevant investments: Creative Juice, Gather, Sanlo, Fanbase. It is a truly horizontal trend investors are paying close attention to across the board. This can be attributed to the rapid growth of the creator economy and the influx of new and innovative startups. Web3 creator economy startups are popping up all over the continent. Index Ventures is a VC investment firm that has been around since 1996, and has $6.83 billion in assets under management. This list was determined by Insider based on our reporting and the nominations that we received. Quinn brings a wealth of experience, having spent eight years on the equity sales and research side of Morgan Stanley, working on Facebook, Groupon, and Pandora's IPOs, before eventually working on branding and marketing at the London-based fintech startup Nutmeg. Investor: Paige Finn Doherty, founding partner.
Unlocking the market for the mainstream user and bringing the masses to Web3 is one of the most exciting investment opportunities of our time, says Paola Vivoli, Investor at Speedinvest. ", Relevant investments: Juice, Stem, Human, Pearpop. This will lead to the success of the creator economy.
"As much uncertainty as we have, founders have," Nath said. But before we start exploring the next iteration of the creator economy through the Web3 lens, lets take a step back and look at the historical evolution of the sector. Furthermore, its not just that anything is becoming investable, but also how we spend our time is becoming an investment decision.
"It's less about the category actually and more about how loyal and engaged their audience is," Lightcap added. We remain incredibly excited about how the future of the internet evolves and we remain deeply passionate about supporting the next generation of platforms. Today, its difficult to define mainstream without decoupling it from mobile, says Robby Yung, CEO of Animoca Brands, so its arguable that, in the post-mobile world, nothing is mainstream unless its on mobile.. Even though the firm was founded in 2020 it has already become one of the biggest players in the creator economy. Web3 enables creators to be finally compensated like the entrepreneurs they are. MaC is a VC firm that prioritizes seed-stage companies in tech and media. So it makes sense that the creator economy would take off in the US before Europe. But this growth in the creator economy is also driven by record amounts of funding pouring into the market from prominent investors - $1.3 billion in 2021 alone. They have clearly defined intrinsic value on top of the usual scarcity associated with NFTs and are broadly classified into the following categories: community, fantasy sports, gambling, gaming and social. Night Ventures focuses on early-stage investments in fintech, crypto, SaaS, and health. We are seeing a lot more creators tapping into NFT, subscription community, and building brands to increase income streams., Creator burnout. These numbers have raised eyebrows and caused panic amongst creators. "The second piece is whether there's a big market opportunity that the platform is tackling, and if so, what really is the go-to-market approach and how are they going to be able to tackle this large market in a proper, sequenced way. We look forward to hearing your thoughts on what you found interesting, what you think we missed, or any other viewpoints on this new Web3 consumer economy.
"What we're doing is trying to combine my traditional finance background [and Michael's] creator side of things," Kullberg told Insider. Investors would want to check that founders have a sufficiently good understanding of their (future) community, as well as of where the company sits in the Web3 landscape, and thereafter are able to define the ideal toolbox of Web2:Web3 strategies (e.g. The startup investments are led by Kimmel, with investments in startups like seven unicorns and Clubhouse. Partnerships are great income, but creators should be thinking about long term success. Online content distributors, such as YouTube, Facebook and TikTok have also all launched their own creator funds, allowing them to directly enter the sector and also helping them to entice creators to their platforms. He continues, We are so excited to see how the space evolves over the next few years in all aspects from gaming companies where you no longer need to buy multiple avatars in games.
Relevant startups: Pearpop, Dispo, Clash, Fourthwall, Zestworld, Investors: Chris Farmer, CEO; Wayne Hu, venture partner; Yuanling Yuan, vice president; and Josh Constine, venture partner. They also do not provide options for creators to be discovered through their algorithms and only a few provide direct ownership, enabling all stakeholders to profit from their contributions. Since joining Jump, Nath has set her eyes on funding startups that provide solutions for the "consumerization" and "professionalization" of creators, Nath told Insider. Startups solving these areas span social platforms, fintech, data science, and business development tools. He also co-founded two startups focused on working with creators: Creator+ and Kollyde. Insider has compiled our second annual list of the top venture capital and investment players who are funding startups that are shaping the creator economy. Out of 144 companies, only 18 are based in Europe. What we are seeing today is an incredible combination of talent and capital flowing into the ecosystem, further fuelling innovation in the decentralized technology stack, as well as consumer-facing applications that are now disrupting all ecosystems. Jarrid Tingle, a managing partner at the firm, told Insider he looks for "strong teams, customer obsession, a product with demonstrated value to users, and industry tailwinds that can help the company scale rapidly," when seeking out new portfolio companies. Benjamin Grubbs (founder and CEO) was a global directory for creator partnerships at YouTube for almost 15 years before starting Next 10 Ventures. Are they simply there to just be a conduit for bigger brands or other marketing, or do they actually have it the ambition to build something kind of big around themselves? "Many creators are amazing at driving views, but only a small subset are able to drive that attention into commercial intent," he wrote to Insider by email. He has been shaping their portfolio ever since and is one of the voices shaping perspectives in the creator economy. His portfolio includes companies like Popcorn, Koji, Stage Ten, and Superbam. Marlon Nichols (co-founder and managing partner) was an investment director at Intel Capital before confounding MaC. Caspar Lee (Creator, Influencer.com, Creator Collective Capital), Blake Michael (Creator), Bremner Morris (Rally.io), Sarah Nckel (Northzone, Femstreet), Niko Bonatsos (General Catalyst), Sasha Kaletsky (Creator Collective Capital), Jim Shepherd (Snapchat), Max Fosh (YouTube Creator), Rex Woodbury (Index Ventures), Nicole Quinn (Lightspeed Ventures), Tim Draper (Draper Associates), Sandy Lin (TikTok Creator), Meagan Loyst (Lerer Hippeau), Ann Miura-Ko (Floodgate Ventures), Danielle Lay (NEA), Michael Sidgmore (Broadhaven Ventures), Kieran Hill (20VC), Harry Stebbings (20VC), Sameer Singh (Network effects Advisor and Atomico Angel), Mattia Mrvosevic (Eterna Capital), Jarrod Dicker (TCG), Brandon Potts (Framework Ventures), Robby Yung (Animoca Brands), Bradford Stephens (Blockchain Capital), Courtney Chow (Battery Ventures), Jade Darmawangsa (Creator), Dominik Tobshall (Speedinvest), Sam Nasser Zare (SoftBank). Gould is an active angel investor and advisor in a number of startups including Clutter, Gyft, Compologu, DraftKings, Step, Rinse, Jukin Media, Stem, Brandable, Pocketwatch, Cargomatic, Beautycon, and others. The US also happens to be the cornerstone of the global media ecosystem and home of Web2 creator giants of the likes of Myspace, YouTube, Snapchat, etc. The financialization of everything.
"Founders who innately understand these types of creators are rare, and the ones we focus all our efforts to serve. Formed in 2019 after the merging of investment firms M Ventures and Cross Culture Capital, MaC Venture Capital is a VC firm focused on seed-stage investments. Lis strategy is based on funding companies that are part of the passion economy. The company has invested in a slew of creator-focused companies, including esports organization FaZe Clan, content curation platform Curiti, children-focused social-network Zigazoo, video production company Brat TV, and virtual-influencer brand Brud (now part of Dapper Labs). It stands for community, brand and ownership.. 
"Capital efficiency is more important than ever now because you have fundraising risk," said SignalFire venture partner Josh Constine. As new opportunities continue to arise and all eyes turn to the space, we asked a few investors what they are most excited about, as well as where they see the biggest opportunities unfolding in Web3 - here are their answers. The company was valued at $7.5 billion just a few years later. If we look at the European Web3 creator companies and tools in our mapping, broken down into their respective categories, we have identified the below companies: Check out the entire list below, including information about their category, stage and location.
Katelin Holloway (founding partner) was head of people and culture at Reddit, and was also an operating partner at Initialized Capital before she joined Seven Seven Six. As a creator's audience grows, their insatiable appetite for content from the creator can become a life consuming endeavor. Thank you for reading our piece and we hope you have enjoyed it. Box group invests in pre-seed and seed rounds of financing for early-stage startups, with a primary focus on tech companies. Examples of metrics to quantify the quality of the engagement and health of a network are: Monthly Active Wallets: Unique users with active token wallets last month. As we look into the new direct creator-to-follower relationships and at the future of the creator economy, we could not be more excited about the new native ways in which creators can earn an income, funded by and together with their communities, in what we believe to be the emergence of new and more sustainable economies. 