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The Creator Economy: Everything You Need to Know

by Colin Burton · Published August 8, 2022

There’s never been a better time to become part of the creator economy. Read on to learn all about the creator economy and how you can benefit from it.

A ten-year-old having a $100-million-dollar net worth from making YouTube videos. 

A TikTok influencer launching a fix-figure online course business teaching Excel, a year after she posted her first TikTok video. 

A 33-year-old mom making $760,000 a year in passive income from her blog, while working 10 hours a week.

So yes, content creator is a legitimate job. And yes, people can and have made money creating content.

So much so that the term “the creator economy” has been coined to refer to this era, where more and more people have made content creating their full-time job or even their business. Bloggers, videographers, YouTubers, streamers, influencers — the list is endless.

So what is the creator economy, how is it growing, how do creators earn money and what’s in it for you? Let’s take a look. 

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What is the Creator Economy?

The creator economy is an economic system where the main revenue drivers are creators. So what are “creators”?

Marketed in 2011 as a phrase to replace “YouTube stars” — the original term for “YouTubers”, the word “creator” now encompasses much more than just people who create content.

It now refers to individuals who earn money off of their knowledge, skills, talent — most often course creators, content creators (like writers, content writers, copywriters, etc.), curators, bloggers, influencers, graphic designers, and more.

An example of a creator is Miss Excel, who launched a six-figure online course business teaching people Excel, just about a year after becoming viral as @mis.excel on TikTok.

Miss Excel’s courses on Thinkific.

Of course, a “creator” doesn’t just provide knowledge or talent. You can create physical goods too. Sites like Etsy have provided an opportunity for arts and crafters to market and sell their DIY goods without having to open a brick-and-mortar store or owning a website.

Now if you think about it, teachers or course creators like Miss Excel wouldn’t be able to succeed back when social media wasn’t as prominent as it is right now. Traditional courses were mostly taught in school or at college — or in other words, they had to be provided by a named institution. The same thing applies to other types of creators: If you wanted to make a living as a writer, an actor, a songwriter, an artist and the like, you had to be really talented and of course, lucky enough to be picked up and promoted by a big media company — and then you’d have the first taste of success.

But fortunately, times have changed.

The rise of the internet, social media, and technology means that any individual with access to simple gadgets like a laptop and a phone (with a functioning camera) can become writers, photographers, filmmakers, videographers, course creators, and more.

And then came COVID-19. Lockdowns and unemployment mean that people had more time on their hands — both to look for other ways to earn a living, and to search for more content to fill up the rest of their day. We watched more YouTube or TikTok videos, read more blogs, listened to more podcasts. And as the demand for content rose, so did the supply.

New to the creator economy? The Leap is a website and newsletter covering advice, tools, and the latest industry stories to help new creators start earning $$$. Subscribe today.

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The creator economy isn’t limited to just creators

As the name suggests, the creator economy places the focus on “creators” as the main revenue drivers. But it’s much more than that.

New jobs have been created as content creation has become more popular. Time traveling back two decades ago, people wouldn’t understand if you talked about an “influencer” or a “social media manager” or “streamer”. Now these are legitimate jobs that can help people earn a living.

Of course, as more people start creating content, certain types of jobs have become more in demand. An example is video editing — which has become more popular as making money off videos is no longer limited to traditional film or documentary making.

This has also prompted technology to adapt to the change, with companies creating products that cater to people’s increasing needs to take photos, create videos, or use social media. Canva has offered a social media manager feature so its users can design and schedule social media posts all on one platform. Apple also prioritizes marketing the boosted performance of their MacBook Air line based on the need for video editing, gaming, image upscaling and the like:

Source

Creator economy vs. knowledge economy

You may have heard of the term “knowledge economy”. So what’s the difference between the creator economy and the knowledge economy?

The knowledge economy is an economic system where the main commodity is knowledge, not physical goods.

This means that instead of only placing value on buying and selling physical products (like shoes or cars), value is also placed on expertise, innovation, discovery, and any other intellectual capital (like IT support, branding, research, or consulting).

The knowledge economy grew in the era of the Internet, with traditional (mostly manufacturing) jobs wiped out and giving way to the rise of technology.

Meanwhile, jobs like “creators” date back before that (writers, filmmakers, etc. exist before the Internet) but only recently has the creator economy exploded with the term “creator” being used more liberally.

So you can safely say that the creator economy is the development of the knowledge economy.

For more information on the knowledge economy, check out this post: What is the Knowledge Economy (And Why Should You Care)?

Creator economy vs. passion economy

As the name suggests, passion economy refers to an economy system where people earn money from their passion.

With this, there’s a big overlap between the creator economy and the passion economy, as creators tend to create products or services from what they’re passionate about. Take Pewdiepie as an example – who would have thought you could make money (millions of dollars, in fact) from streaming game walkthroughs with witty commentary?

Of course the creator economy spawns other types of jobs to support creators — as mentioned above — which make them not belong to the “passion economy” entirely.

Growth of the creator economy

The creator economy has exploded in recent years and is estimated to grow even more. Here’s some interesting creator economy stats about the growth of this market.

  • The creator economy is estimated to be around $104.2 billion, with a substantial growth trajectory similar to the gig economy. That’s a future valuation of trillions of dollars. (Influencer Marketing Hub)
  • There’s more than 50 million creators worldwide, about 93% (46.7 million) of which are amateur individual creators. This means there’s about 2 million professional creators currently making content full-time. (SignalFire)
  • The global market size for influencer marketing in 2021 was valued at $13.8 billion, more than double what it was in 2019. (Statista)
  • 78% of consumers reported that they discovered a new product while watching videos from content creators. 76% reported finding useful information from this type of content. (Statista)
  • About 60% of full-time creators believed that email/newsletter or Instagram helped grow their audience in 2021. (ConvertKit)

Top corporates have certainly made the move to suit the boom of the creator economy. It’s obvious: they want to keep creators on their platform. This is often done by offering monetization opportunities. Examples include: 

  • Facebook recently rolled out Facebook Stars, a feature available to streamers. Viewers can buy and send stars while someone’s streaming, and each star equals $0.01 USD.
  • Twitter rolled out a Super Follow feature — a paid monthly subscription that allows followers to access bonus content, exclusive previews, and perks from top Twitter accounts.
  • Clubhouse launched Clubhouse Payments, which allows users to tip creators directly.
  • Spotify also has a paid subscription service for podcasters. Listeners can subscribe to their favorite podcasters for a fee, and podcasters can keep 100% of their subscription revenue until 2023.

Of course, funding and deals to creator-focused companies have skyrocketed as well. 

According to CB Insights, the online course platform Kajabi tops the list of most well-funded creator economy companies, having drawn $550M in investment at a $2B valuation. Patreon comes in second place ($412M), followed by Cameo ($166M). 

One major part of the creator economy is the online learning industry. We’ve released a report on the state of the online learning industry in 2022, with these major trends:

  • 66% of Americans have been more motivated to seek out online learning since the pandemic began
  • Students demand for online learning has increased dramatically across all industries — from health and fitness to software and technology (2019 – 2021)
  • Online content creation is the most popular type of business that people aspire to launch (51%), beating out selling products online (49%), providing services online (49%) or in person (46%), and opening a brick and mortar store (39%).
  • Thinkific platform data suggests more people successfully build revenue through online education, year over year. And with students seeking out more personalized and nice learning experience, you can achieve success without needing 10,000+ followers on social media.

Related: The Leap goes deeper into creator economy stats here.

How do creators make money?

Short answer: Multiple ways. Creators can earn money from content monetization, sharing advertising revenue, receiving subscriptions or tips, charging for courses, and more.

Now, let’s break down some of the main ways creators can earn money online: 

Creating and selling digital content

Digital content isn’t limited to written content. Creators can monetize their writings, designs, videos, how-to guides, courses, photos, mobile apps, and the like.

Traditionally, a writer needs to connect with a publishing house to have their book published. Now anyone can write and self-publish a book with Amazon. Of course you need to promote it well in order to make a living from it — but at the end of the day, it is possible to publish a book without an agent.

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You can also start building an audience first through writing on Wattpad, and later publish your work once you’ve got a solid following. Wattpad also offers Wattpad Paid Stories — where you can earn money directly on Wattpad by putting chapters behind a paywall. Readers will buy Coins and redeem them to purchase the whole story, or one chapter at a time.

Writers can also make money by blogging and revenue sharing with a blogging platform. 

Medium writers can earn money through the Medium Partner Program. They need to have at least 100 followers and have written a story on Medium before. Once enrolled in the program, writers can put their articles behind the paywall, and earn revenue every time somebody reads the posts. The longer someone spends reading their content, the more they’ll earn. 

Writers can also make a living through freelance writing, which applies mostly to content writers and copywriters. According to Superpath Content Marketing Salary Report, a freelance content marketer makes $105,787 on average, and 32% of content marketers with a job also freelance.

If you decide to go this route, you can charge per article, per word, or per project. For example, a conversion copywriter can charge $500 or $1,000 for an email sequence or a landing page copy. 

Of course, you’re not limited to earning your living through just one way. Ryan Robinson — a full-time blogger and podcaster with 500k monthly blog readers — recommends that you have more than one revenue streams. He himself makes money blogging through sponsored content, affiliate programs, creating online courses, selling ebooks, and more.

Ryan’s course Built to Blog

Ryan Robinson can be considered an infopreneur; that is, someone who set up a business centered on gathering and selling information and expertise. Read our blog to learn what is an infopreneur and how they make money from information products.

Freelancing is also a route you can go if you create and sell other types of digital content: you can freelance as a graphic designer, a photographer, a videographer, and more.

Fitness influencers who first build their following through YouTube also sell their fitness programs online. Natacha Oceane offers a bunch of training and nutrition guides on her website, with price starting from $39 per training program and $5.50 per recipe guide.

Want to learn more about digital products you can sell? Check out our post: 21 Profitable Digital Products and Where to Sell Them.

Creating and charging for courses

If you’re good at something, never do it for free. Teaching online lets you turn your expertise into a new source of revenue.

Online courses aren’t just limited to traditional classroom environments like high school and university, or corporate trainers adapting with remote onboarding…  And you don’t need to be formally trained as an educator either.

You can create an online course to teach people just about anything — from tai chi and drone piloting online to yoga, and guitar. 

Courses are great to build your following as well. You can create free courses as lead magnets, and once those leads are warmed up, you can upsell them to your paid courses.

Miss Excel (Kat Norton) also does this to quickly add some revenue to her business, albeit a bit differently. Every few months, she hosts a free Excel training and, at the end of the training, offers her students each course for half the price as well as the option to purchase the bundle for just $50 more. 

Related: How To Use Webinars To Promote Your Courses 

Webinars have proved to be the most impactful action for her revenue; the last webinar she launched generated $50,000 in 24 hours.

Here’s another example: Freda Lombard, owner of an art studio, pivoted her business to an online art school when COVID hit. Now, she offers three Thinkific products under the brand Zealous Art: a membership program, individual courses, and course bundles.

Lombard also has a membership program (another way to make a living — we’ll touch on this in a moment). Her membership brings in an average of $4-5k per month, but some months she’ll have $15k in sales if she offers a new bundle of courses. 

If you’re interested in creating your online course but not sure where to start, check out our resources: 

If you’re ready to start earning your living through online courses, create a free Thinkific account today and explore our platform.

Sharing advertising revenue

You can earn revenue from having advertisements on your page. This could be on your blog if you have enough traffic, or on your YouTube channel (if you have enough views), or through other means.

Take for example. If you qualify, you can enter the YouTube Partner Program. The minimum eligibility requirements are:

Once you meet those criteria, you can start putting ads on your videos. You only make money if your viewers don’t skip ads. According to Influencer Marketing Hub, the average YouTuber makes $18 per 1,000 ad views, which translates to $3 – $5 per 1,000 video views.

8 PROVEN WAYS TO PROFIT FROM YOUTUBE SHORTS: Download Now

Related:

Creating sharing sponsored content

Once you’ve garnered a big enough following, brands may contact you to advertise their products/services. This is sponsored content. 

Michelle Schroeder-Gardner from Making Sense of Cents charges $5,000 per sponsored post and earns on average $10,000 to $20,000 per month from this revenue stream.

If you’re ready to sponsor content, you can either reach out to sponsors directly or let sponsors know by including a section on your site that allows sponsors to contact you. Ryan Robinson talks more about some tips to monetize your blog with sponsored content here, but generally speaking you should build trust with your audience by:

  • Writing content that isn’t sponsored
  • Actually using products or services you’re advertising
  • Showing your audience what you’re promoting really works

Engaging in affiliate marketing

A close cousin to sponsored content, affiliate marketing is when a brand pays a creator each time someone makes a purchase based on their recommendation.

Affiliate marketing is one of ways to earn passive income. Most creators start by reviewing products they use or making content around products/services they would like to work with, and join an affiliate program with a brand once they’ve gained a good enough amount of following.

Amazon, for example, has the Amazon Associates program where creators can earn up to 20% in commissions from qualifying purchases. How much you earn depends on the product category: Amazon Games offers a fixed commission income rates of 20%, while it’s 10% for luxury beauty, 5% for digital/physical music, 4.50% for physical books and so on.

Related: 44 Best SaaS Affiliate Programs to Monetize With

How much money you can make from affiliate marketing also depends on how big your audience is, and ow engaged they are. For the most part, influencers with larger audiences make more money than influencers with smaller ones.

Ali Abdaal, a YouTuber with 3.15M subscribers, made about $11,000 per month in affiliate income with Skillshare and about $450 a month with Amazon Associates in 2020.

Ali Abdaal’s affiliate income with Skillshare in 2020

According to Scaleo, the typical affiliate marketing income is $50,000 to $65,000 per year, with top earners earning six figures or more.

Receiving subscriptions and/or tips

Creators can make money by gatekeeping their premium content behind a paywall and having their audience pay a subscription fee.

Remember Lombard’s Zealous Art? Her members pay $19 per month for the membership program, which brings in an average of $4-5k per month, but some months she’ll have $15k in sales if she offers a new bundle of courses.

And your courses or trainings can be offered as a subscription too. Joanna Wiebe, founder of Copyhackers, opens Copy School where copywriters, marketers or small business owners can join and learn everything about copywriting from scratch, at $497/month or $4,997/year.

Speaking of writing, Substack, the blogging and newsletter platform, allows writers to publish a post for free or for paid subscribers. Substack gets 10% of all subscription revenue. 

There are now more than 500,000 paid subscriptions across Substack, and the top 10 writers make more than $15 million a year collectively.

If you’re into gaming or livestreaming, you may want to look into Twitch. A viewer can pay $4.99, $9.99 or $24.99 per month to subscribe to a channel they like on Twitch. Viewers can also support streamers with Bits by Cheering in chats, and streamers receive $0.01 or each Bit used. 

According to Influencer Marketing Hub, successful Twitch streamers can make $3,000 to $5,000 from their subscribers, with the top ones earning substantially more.

Receiving funding from a donation platform

Have you ever backed a project on Kickstarter, Indigogo or GoFundMe? Those are the two platforms entrepreneurs can use to receive funding to support their businesses.

The latest data from Kickstarter shows that there are more than 200,000 successfully funded projects, with more than $6.7 billion dollars pledged in total.

Of course, not all projects on Kickstarter are funded. More than 300,000 projects are unsuccessful, with around 56,000 finished having received zero pledge.

Kickstarter, Indigogo or GoFundMe are project-based funding platforms. If you want to opt for a subscription-based funding platform, you may want to check out Patreon.

On Patreon, fans can pay creators a set amount of money per month just to support them, or to get access to premium/gated content and other perks.

There are more than 220,000 creators on Patreon with at least one subscriber, with more than $24 million dollars in monthly payouts estimated by June 2022. 

Selling goods online

Interested in selling your arts and crafts? Etsy is your friend. In 2020, Etsy processed $10.28 billion in gross sales, a 106.84% increase from 2019.

You can set up a shop on Etsy in minutes and start selling. Plus, there’s already a large community of crafters and vintage sellers and buyers you can target — there are 4.36 million active sellers and 81.9 million active buyers.

Etsy charges sellers three types of fees:

  • Listing fee — $0.20 for a 4-month listing
  • Transaction fee — 5% of the listing price per sale
  • Subscription fee — Etsy Plus costs $10 per month

You can also sell your products on Amazon. The individual plan costs $0.99 per unit sold, and the professional plan costs $39.99 per month no matter how many units you sell.

Etsy vs. Amazon (Source)

Selling fan engagement

What is selling fan engagement exactly? Here, creators — most often celebrities — create a personalized video and sell it to their fans. It’s best represented by the platform Cameo.

You just go on Cameo and request a customized message from a celebrity. This could be for a birthday, an anniversary, and so on. People have used Cameo videos as gifts to their loved ones as well. The price for a video can range from under $50 to thousands of dollars. 

Future of the creator economy

With investors pouring money into creator-focused platforms and technology continuously improving to match with consumers’ demand, the creator economy will continue to grow even more.

Influencer Marketing Hub estimates that the creator economy is valued at $104.2 billion, with a growth trajectory similar to the gig economy — making it having a future valuation of trillions of dollars.

Plus, the gig economy also encourages the development of the creator economy. People used to receive income from salaries or wages. Now we can earn a living from short-term, project-based work arrangements — as freelancers, consultants, or independent contractors.

The Content Marketing Salary Report by Superpath claims that on average, a freelance content marketer makes nearly $15,000 more than a full-time one. And more content marketers with a job also freelance on the side (32% in 2022 compared to 27% in 2021).

It’s also a lot easier for you to become a “creator” now. 

Creators needed to spend large sums of money to purchase expensive equipment to create content. It’s hardly the case anymore. With a laptop and a good camera (or a smartphone), you can start creating content on most platforms. Of course you can invest more as you grow, but the barrier to entry is much lower now.

As social media sites continue to develop features that benefit creators, more and more people can use these platforms to build their following before capitalizing on that. 72% of creators list Instagram as their primary platform for content.

However, this does take time — you can’t expect your first video on YouTube or TikTok to go viral overnight. ConvertKit reports 67% of full-time creators started building an audience more than three years ago, and just over a quarter began a decade or more ago.  

The Role of NFTs in The Creator Economy

You’ve likely heard of NFTs, but if you haven’t — it stands for non-fungible tokens. “Non-fungible” means that it’s unique and can’t be replaced with something else. 

NFTs can be anything digital. Most of the time they’re unique artworks, cards, badges, stickers, collectibles, and the like. You can even sell your tweets: Jack Dorsey, the billionaire co-founder and CEO of Twitter, sold his first tweet “just setting up my twttr” as an NFT for $2.5 million.

At its core, NFTs are digital files. And just like other digital files, people can copy them as many times as they want. So what’s really valuable about NFTs is the concept of ownership: when you buy an NFT, you own it (with the copyright and reproduction rights still retained by the artist). In a way, NFT collecting is like a form of fine art or physical art collecting.

What does this mean in the era of the creator economy? Well, social media giants have jumped on the NFT train: 

  • Twitter announced that it’s adopting NFTs and allowing users to display them on their account, the same way as a profile picture.
  • Meta (Facebook) showed its interest in turning NFTs into a revenue stream for Instagram creators.
  • YouTube is also looking at launching new monetization tools that allow creators to sell content as NFTs and fans to own unique videos, photos, art and even experiences.

With the NFT-based crypto art market worth about $1.7 billion (as of July 2022), NFTs can be a game changer for the creator economy, allowing both creators and consumers to connect and benefit from a value exchange of digital goods.

In an essay written for Hackernoon, strategist and essayist Michele Canzi believes that “subscriptions are imperfect monetization models that do not capture the value of fan-creator relationships.” With fans valuing the social validation of being part of a community, Canzi sees this as an opportunity for NFTs to be a better representation of equity ownership for fans and creators.

According to Canzi, creators can use NFTs to recognize achievements and/or highlight their relationship with their fans. Course creators can issue NFTs as completion badges for people who finish their courses. Writers can award NFTs for their first subscribers, deepening the value of the community they’re building.

How You can Benefit from The Creator Economy

So what does all of this mean to you? Can you make a living as a creator, in the creator economy?

The simple answer is yes, you can. Even easier if you’re already an expert at something. Once you’ve built your audience — which can take months or years depending on where you’re at — you can start monetizing your expertise. Online courses. Subscriptions. Sponsored content. The opportunities are basically endless. 

Of course, it’s going to take more than one stream of income to have a sustainable living. Even if you’re making six-figures in one revenue stream, do not rely solely on it — make sure you always have something to fall back to.

Patreon’s 2022 Creator Census, which surveys 13,000 creators, reports that 41% of their income come from Patreon. Other top income sources include jobs related to their creative pursuits, commissions, and subscriptions on other platforms.

So if you currently have a full-time job and would like to tap into a creator line of work, start by creating content part-time. If you commit to creating content full-time right from the beginning, remember that it’s going to take time at first. The economy isn’t full of overnight successes. Over 60% of full-time creators earn less than $10,000 per year, and about 22% make a middle-class salary between $50,000 and $150,000.

What’s best about this is you can start creating content anytime, anywhere. Tons of platforms are available for you to try, and you just need the bare minimums: a laptop, and/or a smartphone.

At The Leap, we believe that the creator economy is much more than a job market; it’s an opportunity for creators to build businesses – and earn money – on their own terms. We envision a world where all creators can thrive in the creator economy. And with The Leap, we’re bringing that vision to life.

We know that creating your very first few digital products can be a little overwhelming. (“It’s too time-consuming!” “Where do I even start?!”) That’s why we created a free tool that helps you build, promote, and sell digital products in record time – and with minimal effort.

In a nutshell, The Leap makes jumpstarting your monetization journey easy. Our platform enables you to earn more than just your first few dollars, but to build a sustainable income engine by transforming your expertise into profitable digital products.

Make the jump to The Leap. Try our all-in-one creator store for free today.

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About the author Colin Burton

Colin is a Content Marketer at Thinkific, writing about everything from online entrepreneurship & course creation to digital marketing strategy.