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The new era of digital sponsorship. How a group of fan investors can foster, pay for and sustain an authentic creative community.

The creator economy, born in the era of web 2.0 and having exploded during the pandemic, is booming. Today, it includes over 50 million content creators, thought leaders, and bloggers. For about 2.3 million of them, it is a full-time job. Influencers with millions of followers collaborate with world famous brands, collect millions of views and turn clicks into money.

This creative machine is powered by centralized social media platforms, services and tools that help talent grow their audience and monetize their work. According to the CB Insights report, creator-focused businesses raised $1,207,967,200 in 2021 alone. However, more than often, the centralized toolbox that creators use to earn a living becomes a problem in itself. .

The challenges of the creative economy

With the emergence of centralized social media networks and social journalism platforms, creators have had the freedom to publish their content with just a few clicks. They no longer needed to create and maintain a website – while integrated tools allowed them to promote themselves and reach their followers. In other words, what needed to be done by an entire team of professionals became the work of one person.

The curious thing about the human psyche is that we are satisfied with what we have unless we know there is a better alternative. It took until the rise of decentralization that the disadvantages of centralized platforms – such as high commissions, inequitable income distribution and changing policies – became obvious to the masses.

The fees range, indeed, from tangible to insane. On the one hand, Patreon takes 5% to 12%. Substack takes 10% less processing fees. OnlyFans says the 20% fee helps offset the costs of security and privacy features required by adult content, in particular. In the case of Twitch, this is a 50% reduction in all subscriptions.

Being dependent on platform policies (i.e. regarding content) is another problem for the modern creator. A good example of this is OnlyFans’ recent announcement that it would ban explicit content, which used to be the main source of income for many people.

The Rise of DAOs

In this context, the rise of decentralized autonomous organizations, which Mark Cuban double, “the ultimate combination of capitalism and progressivism,” seems more than timely. The concept was first created in 2016, by a group of developers who took the idea of ​​cryptocurrencies to the next level. Sharing the same level of trust, DAOs would provide a transparent system of governance, as well as fair and timely distribution of the organization’s funds, thereby reducing bureaucracy.

Unlike traditional organizations, DAOs don’t have a typical management structure or board of directors and are funded by venture capital based on open source code. Much like open source projects such as Bitcoin Core, DAO projects involve both volunteer participants and passive subscribers, often led by paid core contributors.

In addition to this, DAOs can help eliminate human error or manipulation with investor funds. Participants can decide how to use funds locked on the blockchain by participating in a transparent and automated voting process.

New-age investments, equality and cool neighborhoods

With the help of DAOs, creators can better connect directly with their audience and analyze how their work is distributed and consumed. Fans and investors, in turn, can become the mercenaries of the new age, funding their favorite creators and ensuring that more of the content they love is brought to the digital world. By pooling their money and setting rules for sharing and allocating assets, resources and risks, they can open up new frontiers for investment in the creative economy.

The empowerment of independent and minority creators is another benefit offered by DAOs. Syndicate, a community investment system that provides communities with the tools to work with decentralized investments, has already seen the creation of DAOs that support female, non-binary, black, and African founders, as well as emerging/neglected markets and the Scientific Research. . This is a huge step towards supporting minorities and increasing equality and representation in the marketplace.

And finally, the DAOs contribute to the rise of a well-known phenomenon in the world of traditional art – for lack of a better wording, “the freshness of the neighborhood”. Imagine a neighborhood, dull and cheap, like a freshly created DAO. So imagine artists coming to this place and starting to create. Gradually, the space fills with “strange and creative” people, as Andreas M. Antonopoulos puts it, and lights up with concerts and galleries. It gets trendy.

The emergence of such like-minded communities that revolve around them and grow in value could happen in a real neighborhood – or in the DAOs of the digital space.

A “no” to digital gentrification

The artistic districts have a certain charm. However, just as real-world cool neighborhoods fall into gentrification, digital gentrification is the bane of hip digital neighborhoods. We’ve seen it play many times throughout the history of the web. As digital communities become the place to be, big business and censorship enter the scene – stripping them of the creativity and speed that come with diversity and freedom of expression, making them bland.

With DAOs, this ultimately does not have to be the case. You can’t stop a DAO – you can only fork it. Now imagine a DAO that only grows and grows because gentrification is not possible. Because the moment someone tries to pick it up, it’s bifurcated and pulled away. Following the main principles of web 3.0, DAOs integrate perfectly with the creator community, forming a fairer ecosystem, giving independent creators access to new income and opening up an opportunity for truly decentralized content production.

In my opinion, DAOs enable a brave new world, and most importantly, a world where authenticity, creativity and diversity grow wild. – and uncensored.

Viktor Trón has spearheaded the Swarm project since its inception. He is now president of the Swarm Foundation and holds the position of chief architect.

Featured Image: Shutterstock/metamorworks