- What is Patreon, and how does Patreon work?
- How does Patreon make money?
- Percentage of Creators Monthly Revenue (Platform Fees)
- Currency Conversion Fees
- Payout Fees
- What is the Patreon business and revenue model?
- Patreon’s funding and valuation
- Patreon’s profit and revenue
How does Patreon make money? Here is a full, in-depth, breakdown of their three (3) revenue streams and the different products and services they offer, as well as the Patreon business model, their year-over-year revenue, and how Patreon works.
What is Patreon, and how does Patreon work?
Patreon is a platform that provides an infrastructure for creators to have their own subscription service with their fans, or “patrons” as Patreon calls them.
How Patreon works is: Creators start a Patreon page, upload content, get fans to subscribe monthly to the content they offer, and then Patreon pays the creators and takes a percentage for themselves.
The founders say they started Patreon with one idea in mind — “to get creators paid,” and they are delivering on that promise thus far by paying out over $2 billion, since 2013, to creators.
How does Patreon make money?
According to Patreon, they have more than 200,000 creators on the platform with over 6 million subscribers paying monthly to access creator content.
So how does Patreon make money off of all creators and subscribers on the platform?
Below is a breakdown of how much money Patreon makes and its revenue model. Including their main revenue streams and how much they charge for their services.
Here are the 3 ways of how Patreon makes money (in 2021):
Patreon has a revenue model that makes money in three (3) ways.
#1. Percentage of Creators Monthly Revenue (Platform Fees)
Patreon makes money by taking a percentage fee of each creator’s monthly revenue earned through Patreon.
Creators can choose from the three subscription tiers: Lite, Pro, or Premium. The tier they choose will determine how much Patreon will take each month from their earnings.
Patreon Percentage Fees:
- Lite: 5% of the monthly income
- Pro: 8% of the monthly income
- Premium: 12% of the monthly income
Note: To date, there are more than 200,000 creators on the platform with over 6 million fans paying monthly to access the creator’s content.
#2. Currency Conversion Fees
Whenever a subscriber pays in a different currency than the creator is paid via Patreon – Patreon charges a 2.5% fee to convert the currency to the creator’s preferred currency.
Patreon supports eight (8) different currencies on the platform: USD, EUR, GBP, CAD, AUD, SEK, NOK, and DKK. Creators cannot have multiple currencies in their account balance.
Patreon Conversion Fees:
- 2.5% conversion fee
Note: The average currency conversion fee across credit cards is around 1% – about 1.5% less than Patreons conversion fee.
#3. Payout Fees
Whenever a creator transfers funds from their creator account to their bank, PayPal, or Payoneer account – they will incur a small payout fee each time.
Fees differ depending on the creator’s currency and withdrawal method. But the most common is direct deposit to a bank account in USD. These fees are $0.25 USD per payout.
What is the Patreon business and revenue model?
Patreon makes money through a few revenue models that they combine within their company, they are:
- Commission based business model
- Subscription business model
- Mergers & acquisitions (M&A) business model
Patreon‘s funding and valuation
Patreon‘s profit and revenue
Although Patreon does not release their annual revenue publically, their estimated revenue was estimated to be around $80 million in 2020 according to backlinko – this has not been confirmed by Patreon.