Mahi Sall, Advisor, Fintech-Bank Partnerships, Payments and Financial Inclusivity
January 25th, 2023
Mahi Sall is the CEO & Founder of FinXpair, a Berlin-based strategic advisory boutique firm focu[...]
Visa’s Solutions for the Creator Economy and Fintech Opportunities for Tomorrow’s Digital SMBs
Creator Economy | Aug 14, 2023
Image: Unsplash/Videodeck.co
The creator economy is evolving quickly with fintech innovations unlocking unprecedented monetization opportunities for content creators.
Tomorrow's Digital SMBs Lack Essential Financial Tools
The creator economy is often seen as the digital counterpart of traditional SMBs. These digital entrepreneurs, ranging from influencers and bloggers to artists and indie developers, are redefining the way we perceive small and mid-sized businesses (SMBs) - the Gig Economy. However, while they share many similarities in terms of business needs, the creator economy has its own set of challenges. For instance, creators, despite their ability to monetize their content, often find themselves treated as individual consumers rather than businesses. This distinction can lead to a lack of access to essential financial tools and services that are readily available to traditional SMBs.
Visa's Initiatives for the Creator Economy
Visa, with its global reach and expertise in the financial sector, has identified this gap and is keen on bridging it. The company believes that creators, much like SMBs, require robust financial solutions to manage inconsistent cash flows, slow platform payouts, and other challenges inherent to their profession. To address these challenges and empower creators, Visa has rolled out a series of initiatives:
- GetP@id Series: This innovative social video series is designed to foster mentorship within the creator community. By pairing up-and-coming creators with established professionals in fields like fashion, music, and food, the GetP@id Series offers a platform for knowledge exchange. Aspiring creators can gain firsthand insights and coaching from their mentors, benefiting not just the participants but also the wider audience.
See: Visa Files 2 Crypto Trademark Applications Including Crypto Wallet
- Visa Ready Creator Commerce Program: Recognizing the diverse platforms where creators operate, from social commerce sites to gaming companies, Visa has launched the Creator Commerce Program. This global initiative aims to seamlessly integrate financial tools into these platforms. Key features include faster and more flexible payout options through Visa Direct, as well as mechanisms for tipping and donations. By embedding these tools, Visa hopes to alleviate some of the financial pressures creators face, allowing them to focus on what they do best - creating.
Visa is not just recognizing the potential of the creator economy but is also investing in its future. As creators continue to push boundaries and redefine digital entrepreneurship, having robust financial partners like Visa will undoubtedly play a pivotal role in their success.
Secret Sauce of the Creator Economy
The creator economy is rapidly evolving, with new innovations and trends shaping its future. Here's a look at the latest developments and where the industry is headed:
- The creator economy has seen exponential growth, enabling millions to monetize their creativity through collaborations and brand partnerships.
- Influencer Marketing: It's not just about having a large following anymore. The key is engagement and relatability. Nano influencers and micro-influencers are becoming the future of influencer marketing.
- Creators have built genuine connections and authenticity with their audiences. Collaborating with values-aligned influencers can help brands leverage this trust.
See: Fintech Opportunities in the Wake of Tightened Credit Liquidity in Canada
- The creator economy allows brands to reach targeted niche audiences that align with their target consumers.
- Influencer marketing can be more cost-effective than traditional advertising channels. Nano influencers, with their authenticity and niche targeting, are ideal for influencer marketing.
- Collaborating with creators adds a human touch to brand marketing, allowing brands to tap into emerging trends and expand their reach.
A Closer Look at the Differences Between Creators versus SMBs
Here's a table comparing creators and SMBs (Small and Medium-sized Businesses) across key variables highlighting both the differences and similarities:
| Variable | Creators | SMBs |
| Primary Activity | Content creation (videos, blogs, art, music, etc.) | Product or service provision in various sectors (retail, manufacturing, services, etc.) |
| Revenue Source | Monetization of content (ads, sponsorships, merchandise, donations, etc.) | Sales of products/services, contracts, B2B transactions, etc. |
| Business Structure | Often individual or small teams; may not have formal business structures | Typically have formal business structures (LLC, Corporation, Partnership, etc.) |
| Financial Needs | Inconsistent cash flow, slow platform payouts, need for monetization tools | Regular cash flow management, inventory financing, capital expenditure, payroll, etc. |
| Client Interaction | Direct interaction with followers/fans; often through social media platforms | B2B or B2C interactions; may involve contracts, invoices, and formal agreements |
| Scale | Can be global from the start due to the nature of the internet | Often start local and expand regionally/nationally before going global |
| Regulatory Environment | Subject to platform-specific rules and online content regulations | Subject to industry-specific regulations, licensing, and compliance requirements |
| Tools & Platforms | Use of content creation tools, social media platforms, and monetization platforms | Use of business management software, CRM, ERP, industry-specific tools, etc. |
| Challenges | Platform algorithm changes, content theft, fluctuating audience engagement | Market competition, supply chain issues, regulatory compliance, economic downturns |
| Support Systems | Online creator communities, platform-specific support, mentorship programs (like Visa's GetP@id Series) | Industry associations, chambers of commerce, business mentorship programs, government SME support programs |
See: From Gaming to Gig Economy: How Canadians are Embracing New Payment Methods
10 Fintech Opportunities for the Emerging Creator Economy
Here are some top fintech opportunities and business models for creators, along with some examples:
| # | Opportunity | Description | Business Model |
|---|---|---|---|
| 1 | Digital Wallets & Payment Solutions | Offer seamless payment solutions for creators to receive funds from various platforms and currencies. | Transaction fees, subscription models, earning interest on stored funds. |
| 2 | Creator-specific Banking | Banks or financial platforms tailored to the needs of creators. | Monthly account fees, lending and overdraft fees, cross-selling other financial products. |
| 3 | Crowdfunding & Patronage Platforms | Platforms where creators can raise funds for specific projects or get support directly from their audience. | Taking a percentage of funds raised, subscription fees, advertising. |
| 4 | E-commerce Integration | Integrating e-commerce tools for creators to sell merchandise, digital products, or tickets to events. | Transaction fees, platform listing fees, subscription-based models. |
| 5 | Licensing & Royalty Management | Platforms that help creators license their content and manage royalties from multiple sources. | Commission on royalties collected, subscription fees, one-time licensing fees. |
| 6 | Financial Planning & Advisory for Creators | Offering financial planning services tailored to the unpredictable income streams of creators. | Fee-for-service, percentage of assets under management, subscription models. |
| 7 | Microloan Platforms | Providing short-term loans to creators based on projected earnings or upcoming contracts. | Interest on loans and associated fees. |
| 8 | Creator Insurance Products | Offering insurance products tailored to creators. | Premiums collected minus claims, cross-selling other insurance products. |
| 9 | Intellectual Property (IP) Marketplace | Platforms where creators can buy/sell IP rights or collaborate on joint projects. | Transaction fees, listing fees, subscription models. |
| 10 | Crypto & NFT Platforms for Creators | Platforms that enable creators to mint, sell, or auction Non-Fungible Tokens (NFTs) or receive cryptocurrency payments. | Transaction fees, minting fees, platform-specific tokens. |
Closing Thoughts
The creator economy is not just a fleeting trend; it's a dynamic and burgeoning sector that's reshaping the digital landscape. As creators continue to redefine entrepreneurship in the digital age, there lies a vast, untapped reservoir of opportunities for fintechs, banks, and financial institutions. By understanding the unique financial needs and challenges of creators, these entities have a golden chance to innovate, differentiate, and lead in a market that's ripe for disruption.
See: Monetizing the Creator Economy Through Social Tokens
The fusion of technology and finance has always been about breaking barriers and enabling dreams. Now, it's time to empower the dreams of millions of creators worldwide: Carpe Diem! Seize the day and be the financial backbone of the creator revolution.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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