In recent years, the creator economy has emerged as a new investment category that aligns with the growth of social media and the increase in individuals creating content. Similar to traditional media companies, creator startups often rely on major platforms like Google and Facebook for revenue, which can be unpredictable. Despite challenges faced by some startups over the past year, there are still thriving businesses attracting investment.
One of these successful startups is Fallen Media based in New York, which produces shows for the TikTok audience at low production costs. This allows them to experiment with different shows and gauge their performance without significant financial risk.
The creator economy is characterized by lower operational costs compared to older media companies, enabling startups to try out new business models without taking on significant financial risks. However, companies that focus solely on influencers for revenue may encounter difficulties. On the other hand, those that leverage creators to generate income in other sectors like e-commerce or consumer products tend to have more success.
VC firm Daybreak founder and managing partner Rex Woodbury sees the creator phenomenon as a broad trend across various verticals and sectors. He believes that venture-backed companies in the creator economy often fall into other categories as well. Business Insider is currently compiling a list of VC firms investing in the creator economy and seeking input on which firms will drive growth in the industry in the coming months through a provided form by June 18.
