Monetizing your audience with Simon Ellington from Ko-fi

The Business of Creators is a podcast for content creators and professionals working in the creator economy. On this podcast Ian Shepherd speaks with the companies supporting creators with exciting new tools and platforms and digs deeper to get the scoop on new ways to create, distribute and monetize content.

In this first episode Ian speaks with Simon Ellington. Simon is co-founder of Ko-fi, a free, friendly way to accept donations, memberships and sales directly from fans. They discuss everything from monetizing your audience to the future of the creator economy. 

Ian is co-founder of Electrify Video Partners,  investing $m in established creators to accelerate their growth. 

Transcript

Simon Ellington  0:00  
And it's kind of an all in one service, where a creator can set up a page and start to ask their supporters to contribute to their creative projects.

Ian Shepherd  0:10  
If you're a creator with an online audience, are you thinking about donations? Hey, everyone. Ian shepherd, and welcome to the new business of Creators Podcast. I've been working in the media industry for 20 years now, and directly with creators for the last seven and this year, I co founded electrify video partners, where we aim to invest in growing established creators channels. Now, this new podcast explores some of the companies supporting the Creator economy, offering creators new tools and effective means of monetization. In this podcast, I'm joined by Simon Ellington from covid. Listen up to learn how you could be offering new forms of simple donations to your audience. Great. So let's just jump straight in. What exactly is covid?

Simon Ellington  0:54  
Yeah, so covid fee is a monetization platform for creators, and it's kind of an all in one service, where a creator can set up a page and start to ask their supporters to contribute to their creative projects. And that could be as a simple sort of donation, Tip Jar type approach, which is really our heritage, where it could be more sort of sophisticated kind of monetization methods with things like memberships or selling products. So it's kind of an all in one platform for creators to monetize

Ian Shepherd  1:27  
what they do. Okay, great. And then let's just dig into some of those projects. What sort of some of the most successful projects, or the most common projects that creators use covid for?

Simon Ellington  1:40  
Yeah, yeah. So. So we have some, some standout, kind of, like viral successes on kofi. Recently, there was a, I think the top trending thing on Twitter for a while was popcat. This is like online game where people could click a button and get their country highest on the list of number of clicks. And that was funded via ko fi donations. You saw a huge, huge traffic spike, about a month's worth of traffic in a weekend when that was trending. So you have a load of those kind of standout things, but that's definitely not, not the norm. I would say our typical creator is probably someone who's who's who's got a few 100 or a few 1000 followers and it's just looking to start their monetization journey with, usually, sort of simple donations and maybe one or two other features to try and sort of grow an income. Just slightly less than half of our creators are visual creative artists. So they might be sort of comic creators, or they might be people who kind of do art as a as a passion project, whatever. And then the other half is everyone from podcasters to, kind of your typical online influencer or YouTuber, and huge range of creators use, use ko fi,

Ian Shepherd  3:02  
wow. That's amazing. And in terms of numbers, how many creators do you have on the platform at the moment? Yeah.

Simon Ellington  3:09  
So there's a few different metrics. We've had over 2 million sign ups to covid over the years since we since we started, actually been around since 2012 so one of the first kind of people in this in this market, if you like. But on an average month, there's probably about 150,000 credits that are active or either updating their page when they're receiving donations. So for instance, in August this year, there was $4.1 million was transacted through covid, and it was 40,000 creators that earned something on ko fi, a share of that 4.1 million. You know, wow,

Ian Shepherd  3:47  
that's amazing. Congratulations on kind of the growth that you've had. And I mean, just thinking about where we are now, did covid affect the business in terms of more creators coming on to KO fi, or fewer donations? How's that kind of played out?

Simon Ellington  4:03  
Yeah, so it was interesting. Going into it, we myself and co founder, had a bit of a chat thinking, Okay, this pandemic, see, I don't know how it's going to affect us. And in, in, in retrospect, it makes, it makes a lot of sense, we got a big bump, really, in people using the service. It was interesting. At the time, I was sort of answering the support case of myself and what have you. And some of the comedians that I'd been to see in the UK were coming on and joining kofi, and, you know, wanted, wanted to ask a question and what have you. And they would never would have joined a service like this if they had their traditional kind of monetization event based stuff going on. So there's a there was an inflow of different types of creators. And we definitely saw, like a dog leg growth from from like February to March 2020, when, when the lockdown really hit and covid really hit, and then went back to that steady growth that we were seeing for the couple of years before. But the. Definitely heated things up in the Creator economy, for sure.

Ian Shepherd  5:02  
That's great. And can you name drop any kind of names into of people that are using the platform? Sort of, some of the more popular names, more household names, let's

Simon Ellington  5:10  
say, lots of different kind of creator household names, if you like. I guess so. From from a YouTube point of view, there's this really popular channel called Joel and Leah, this kind of couple of YouTubers that have this series about comparing American to UK life and mannerisms and stuff, and, you know, huge, huge following that, you know, they're bigger users the system as DJ cutsky, DJ Yoda, these, these kind of musical creators, very kind of popular on the service, but we really don't cater specifically for the highest, super mainstream guys. We're quite a approachable platform for creators of all following levels and what have you. So in the Creator universe, if you, like, plenty of creators have heard of kofi, or someone who's got a Kofi you that sort of thing. So, so yeah, there's, there's loads and loads of those kind of creators with reasonable followings that are getting decent traction on on kofi. And recently, there was the big sort of sub off Twitch, or day off Twitch thing going on. One of the protagonists of that movement, wreck it, Raven on kofi was using it as an alternative to twitch subscriptions. We do find when there's sort of trends or events, often, that's when we see, you know, Kofi creators that maybe had been that active, becoming active again. You know,

Ian Shepherd  6:43  
cool. And so you said you started it in 2012 so take us back to then. What was the inspiration? Were you a creator? Or how did this come about?

Simon Ellington  6:51  
Yeah, so sort of co founder of kofi, the original founder, who's, who's still running the business, Nigel. He, he started it as a weekend side project. Lee. It was based around a gap that he saw, or a difference between the online and offline wealth. So he's programmer, and his scenario was, he was, he was working on a freelance project, and, you know, needed to find a way of solving a technical problem, and found this really elegant solution that was posted for free on Stack Overflow, one of the developer platforms. And all he could do to show appreciation to this person who had, like, taken the time to bother to publish this stuff for free was to like, give them an upload. And it was like, you would never do that in the real world, right? If somebody did you have such a good deed or helped you over a problem, what might you do to show your appreciation? And that's where he came up with this coffee concept of buy them a drink, buy them a coffee or something as a as a token of appreciation for a good deed. And that was really the nexus of the idea back into 2012 was a donation button, where A like is not enough, but selling a product or a service wasn't the thing. Either it was just a token of appreciation. That was somewhere in the middle, you know, from selling something or paying someone to just a like or an upload that's relatively meaningless.

Ian Shepherd  8:26  
And so if you're a creator thinking about using kofi, what's the journey that you go through, what's the thought process, and how do you kind of set yourself up on the platform and link to and start sharing with your fans and your audience.

Simon Ellington  8:40  
Yeah, that's so really for for us, we try and make it as clear as we can that Kofi is a really low pressure, easy way to start your kind of monetization journey. And Chris Messina, the inventor of the hashtag, he was one of the original users of kofi, and he's given us some advice over the years, and he talks about donations being like that, that easiest entry point where you can just say, Okay, I'm doing this thing for free online. It might be running a blog. I'm posting pictures of cosplay that I do, or whatever it is. And it's people, people, you know, plenty of creators have this kind of thing of, oh no, no, no one will buy my stuff. Or like, I'm not worthy, you know. And his point was, it's a great way to get over that by just saying, if you like what I do and want to support my work, here's, here's a way of doing it. Go to my ko fi page. You can buy me a coffee, you can buy me a beer. You can change that to whatever you want. And so what we try and do is make it really clear that people can start within a couple of minutes, go to kofi.com and they choose a username, and within a minute or so, they've put in their bio and a picture, and they've got, they've got a page, right? And. Um, and they can start sharing that really easily with fans and followers in quite a casual way, and then, like, build from there. So you've got your donation page set up. You can ask for, oh, would you like any sort of exclusive content? What would be interesting to to you, to see more of maybe you start posting some exclusive stuff for your top fans. You know, maybe you want to sell a physical or a digital product, you know, I'm doing, I'm writing a book, and the first 100 signed copies you can buy in my ko fi shop, you know, stuff. So you can, really can, like, seed it with donations and then grow to whatever really makes sense for your audience, you know, and we encourage that kind of feedback process. What would you like to see? I'm thinking about this whatever. And your fans will usually guide you towards how you grow from that kind of donation just to support the work, you know.

Ian Shepherd  10:54  
Yeah, yeah. So creator can set up a different business model. So it could be a one off payment, it could be a membership, and there's this Kofi shop as well, or shop feature, is that, right?

Simon Ellington  11:04  
Yeah, there's, there's six or seven different ways of earning money on on kofi. And we, we kind of want to put the supporter in the middle as well as the creator. And imagine for a supporter who really likes what you do, if you've got to kind of go over to this service over here to subscribe and become a member of their membership. But then you got to go over somewhere else to buy a product or some merch from them, and then you go somewhere else again to contribute to a separate project. Just is a bit kind of cumbersome. So our aim is to be the tool that gives you super easy to use. Ways to monetize, but we don't force you to use any specific thing. So, you know, you can receive tips and donations, either just on your page or while you're streaming. You have a stream alerts thing going on. You can crowdfund for a goal or not. You know, common thing is, I my my equipment's broke. I need new iPad. You know, fans, maybe you can help me get my iPads on and produce more work that you like, you know, common thing. Or maybe I want to grow more meaningful income, so it's membership. So, you know, Patreon style thing where you can subscribe monthly and receive an ongoing connection to that creator with ongoing benefits. We have the shop tool for very quickly creating links to shop products, digital and physical, and commissions as well. So people are going to say, okay, you know, if you like what I do, you can buy an hour of my time to review your similar thing that you're doing, or whatever you want to offer as a commission. So we give these really kind of diverse ways a creator can grow their income. Very few people use everything, but the options are there, and they're quick and easy to set up. Is the shop is not Shopify. You know, people got 100 different, you know, buttons to twiddle and things to do, but, you know, the core thing of what you want to do to sell something can be set up in a couple of minutes. And that's really what we're about. Yeah,

Ian Shepherd  12:59  
I love the simplicity, yeah. It allows the Creator to almost create something that's relevant to their audience or to their medium, and the tool's got that flexibility. So how does, how does Kofi make money? What's the business model?

Simon Ellington  13:22  
Yeah, so, so to begin with, we were completely free, and it was just a side project right up until 2017 2018 and we're just helping more and more creators, you know, receive a few donations here and there. Now, the way that we work is, is we make money in two ways. We have a premium service, Kofi gold, where some of those other tools, Kofi shop and Kofi commissions and what have you are all available for free. You know, if you pay this monthly fee of $6 a month, or if you you can still get access to those features for a 5% fee without the subscription. So So effectively, you pick whether you want to pay pay upfront for this, to subscribe to Kofi, to get all that stuff, or whether you want to just contribute 5% of your income to Kofi. Either or that's how we make money. Big, big chunk of it is from subscriptions, and some of it is from from the 5% option that's relatively new. Got

Ian Shepherd  14:26  
it. Got it. Thanks. And you mentioned Patreon earlier. How does it compare to Patreon in terms of kind of functionality or offering or the users that might be on the service? Yeah,

Simon Ellington  14:37  
yeah. So, I mean, we love Patreon. We think they've done amazing things for for creators. They started about the same, same sort of time. Patreon is one of those tools that's kind of a it's not, it's not a vertical tool, but it's, it's kind of a mode of monetization tool if you're using Patreon. It's synonymous with membership tiers and recurring kind of memberships. That's, that's what they do. It's what they're known for, and they do that really well. What we kind of think is, is that's, that's great for some people if all they want to do is that, then, then that works. If you want to diversify out of that offer more options. Like some people don't want to pay you monthly, they might just say, I really love this one thing, impulse purchase. Here's, you know, $20 or 50 pounds or whatever it is to contribute towards either that goal or just because I like your thing that you did, you know. So we think just saying you have to commit monthly to this, this, this career, is probably not what most creators want to do. You know, most creators don't have a huge audience where that top 1% that's likely to subscribe is worth enough for you to for you to do it right? Yeah. So, yeah, that's, I guess. The main thing is, we're an all in one platform, not A, not a single monetization method, and we have this kind of really create a first mentality of 0% fees on donations, start really quick, start for free. Whereas a lot of people tell us, with Patreon, it's kind of quite daunting, I'm committing now, as soon as I get one patron, I've got to produce content every month. Of course, these years, you know, I'm in this and, you know, I might have a full time day job, you know, most people do, and they're not only doing this thing. So flexibility, ease of use, create first fees, that sort of thing is probably what sets us apart, I guess. Got

Ian Shepherd  16:35  
it. Got it. I really like that kind of flexibility, and I kind of see that in terms of the different types of creators that use the platforms, everyone from artists and illustrators and, you know, influencers or YouTubers, can you just kind of talk through some of the different groups and how they use it, and perhaps some success stories just to, I guess, inspire their audience, who, you know, perhaps thinking I like what I'm hearing. But how does this relate to me? Yeah,

Simon Ellington  17:02  
is this? Is this for me? Yeah. So I'll give you an example. Frank, Frank James. He's a kind of an Instagram guy who does a lot of work around personalities or content around personality types. And, you know, he found that Kofi works really well as just being an early access thing. So okay, my content is going to go on YouTube or Instagram, whatever on Wednesday. So my top fans, I want it early, can subscribe to my kofi, and they get it on Monday. And it's really easy for me as a creator, because I can just flick that button on YouTube, whatever, from unlisted to public couple of days later, and that content I'm producing anyway is is available. And it's a nice perk for people that wanted to keep doing that, that stuff. You know, there's one example,

Ian Shepherd  17:55  
I'm sorry just to interrupt in that example. How does that practically work then? So they get a link to the unlisted video today, or you've got some integrations as well, right with the different platforms? So kind of, what does that look like from a creator perspective?

Simon Ellington  18:09  
Yeah? So, so there's kind of a two way thing. Kofi is not a discovery platform, so they not refine loads of new followers and supporters from from Kofi. It's more the tooling for for monetization, yeah. So what most creators would do is they have their ko fi page and their ko fi offerings, and they would share their their page or their, you know, call to action on their other social accounts. So it might be the end of the the YouTube video. They said, Okay, if you want to get my you, you know, YouTube videos early and support my page, you can go and subscribe on on kofi, and then we have this concept of of posts like you've, you know, every social tool has, and those posts you can restrict to one time, donators, subscribers, people, a bit certain tier, and you can link certain content. So in YouTube, yeah, you can choose unlisted for as a video. And only people that link will see it and will embed it, so that only people that have paid you at the certain tier will see that stuff. So practically, it's that outbound. Share your page wherever you're active, and then we link to some of those content tools, YouTube, we pull in content Twitch, Instagram, you can post content into, you know, onto your Kofi page. We also have a link with Twitter so that we can, like, auto publish your kind of someone, someone bought me a you know, someone donated on kofi, and we have that published as a little celebration to Twitter when it happens and things like that. So it's a bit of a two way integration, but mainly it's about sharing your page wherever you're active, and bringing people to your page that really want you to see more stuff, join your community or support what you do. Got it?

Ian Shepherd  19:59  
Got it? I interrupt you, sorry. You were telling us about the YouTube and perhaps another example just of a different type of creator, whether it's an artist or someone else, and how they use ko fi to kind of monetize what they're doing or engage the audience in a slightly different

Simon Ellington  20:14  
way. Yeah. Yeah, sure, we, we've got a lot of creators that look a bit like Chris sale. He's a he's a photographer up in the Lake District in the UK, and he he uses a big chunk of what we what we do, and Kofi has become, I think, I don't think it was him that said this, but someone else said that Kofi is now like my digital home, and kind of using all of the tools to monetize. So he's a landscape photographer, but he sells courses on on kofi. He sells membership so people can join and get, like, this personal relationship with him. And they get tips. They get extra, like exclusive content that's just for just, you know, for members, as I say, sales kind of commit these, these Commission request type things. So if you want a one to one session with him, you can do that via, via, Ko fi, and it's just a really nice example of someone who's just kind of using all of the different tools to give all of his fans and followers a way to engage with him. You know, someone might be quite willing to spend 100 pounds for a real, tailored hour of of this creator's time, who's an expert in landscape photography, but they might not donate for, for, you know, three pounds for, for nothing in return, effectively, whereas other people, you know, they value six, six pounds a month to be a part of that tier where they get exclusive tutorials about using your camera, you know, that sort of stuff, yeah.

Ian Shepherd  21:49  
What does the future look like for kofi? Have you got in terms of maybe product development, or, you know, working with a touch of creators? How do you kind of see that over the next few years? Yeah,

Simon Ellington  21:58  
a lot of it is really refinement. So, so memberships was our last, maybe not our last, but one of, one of the final, kind of big ways to monetize that that's only been been around, like three months. Now there's five, 6000 creators using it. So it's, it's, you know, robust and active and everything else. But you know, what we've been focused on is building out these various ways that creators can make money. And I think now there's a lot more nuance to it, where we want to give creators that sort of version two of all of these things, and a real kind of slick last 10% to make a make the experience a really kind of to refine it. I guess when someone commissions you to for that, that, you know, 100 pound one to one session, we should really send you a, oh, if you liked it, maybe you want to send a tip sort of thing, really optional, really casual, but, but in a in a nice way, to help that creator grow their income without kind of forcing that, that component. So, so there's a lot of those kind of refinements that we want to make to the experience of interacting between the creator and the supporter, and, you know, bringing them together, as well as a key thing, you know, we've we're introducing discount codes for shop and commissions in this next couple of weeks, and we're going to be tying that into membership so it automatically can generate you a like, a a coupon if you're if you're a member, so that you get, you know, a discount code automatically in if you're buying something from that creator's shop. See, there's a lot of value in tying these different monetization ways together so that the Creator can really give that experience to the supporter, where they feel like they're getting much more value for money, I guess, and they can delve into the different things that the Creator is providing on their page. Got

Ian Shepherd  23:58  
it and perfect time for Christmas. Then, if it's coming out soon, you know, key for sales and stuff, that's when, from my experience, anyway, creators and influencers kind of really have their peak sales period. So good to hear. And you know, you've been working on this for Since 2012 I've been working with creators for a long time. It feels like the Creator economy is, you know, one of the big buzz words at the moment, and I'm, you know, really excited about just the new tools coming in, the new platforms, the opportunities for creators to monetize what they do. How do you kind of see the Creator industry evolving kind of from what, let's say, where it is now, to where it could be in the next few years? And by creator, you know, I don't just mean, kind of YouTube, but it could be, you know, broader than that, whether it's artists or, you know, other other creators on your platform.

Simon Ellington  24:48  
Yeah, I think the biggest trend is kind of this normalization of creators producing something and getting paid for it. You know, it wasn't Ian. Too long ago to think about the point where you have this kind of oh, there's this celebrity class, and then there's nobody else, right? It's tiny, tiny point 00, 1% and I think what the Creator economy and this passion economy stuff is doing is lowering the bar. It's more about just giving that diversity of platform to people have got something to say or something to offer. So I think we'll see more and more people approach the the Creator economy, wanting to create something, and finding that these actually something they can do and want to do. So I definitely see it as a as a trend that's going to continue. We're going to see, you know, far more diverse types of creator becoming more common, and just this normalization of, Oh, I like what you do. I can easily buy something or become a member or level up my interest in your you know, whatever it is that you you're providing, whether it's a YouTube channel or or whatever, whatever it is. So I think that's going to be going to be pretty key. And I think the tools, the big platforms, are obviously taking a real interest now, the Facebooks and the YouTubes and the like, and they're going to have a part to play for us. It's all about you own your audience as a creator. You know you're you're you're renting your audience if you're using YouTube or whatever else. You know, if you get to download that data, you don't own them. You know, own your supporters. They that the platforms do. So I think there's really a strong kind of need for tools like covid that will will continue. And, yeah, the the big platforms coming in will just help normalize the concept even further.

Ian Shepherd  26:42  
I think, yeah, I was going to just ask that question, actually, just, I mean, obviously, from a platform perspective, they will create, competing for creators attention, and they recognize more than ever, or appreciate probably more than ever, that they've been taking a lot from creators. Creators have been providing content for free. And with the exception of YouTube, they've just been taking all of the advertising out of it, and they're bringing in new features like tipping and stuff. How does that kind of impact Kofi and what you do? I mean, as you say, sorry, I can take the words out of your mouth, but you kind of you alluded to the fact that obviously makes it, normalizes it, which is obviously really important, right? Yeah, yeah.

Simon Ellington  27:21  
And a big chunk of our audience comes from Twitter, for instance. And Twitter's been a very well publicized kind of tipping feature that's this, you know, that's that's been released on on Twitter a good few months now, and we've not noticed any sort of change in the acceleration of creators using covid in and I think what a lot of these tools, the link in bio tools, and the big platforms that are adding these, these tipping features and what have you, so they don't necessarily understand that the experience you want to give to the creator and the supporter is not Just about a transaction, I think that gets forgotten really, really easy. We sort of think of it is half about the transaction, but it's half about the experience of the supporter and the creator coming together, and the message of encouragement that you leave when you leave a donation, all that stuff that we've learned over the decade. And so I see it as kind of only a good thing that you've got these big platforms that I'm making it kind of normalizing the concept, and I'm happy with our position in it of being an independent platform that gives creators their own ownership of their audience and ability to monetize it how they want, in a real, sort of flexible way,

Ian Shepherd  28:38  
as we're sort of closing now. Do you have any advice for creators who are listening in terms of thinking about, I guess, first, using covid, and then, more broadly, about just kind of the future of the Creator economy?

Simon Ellington  28:53  
Yeah. I mean, the one thing I always say when talking to creators is start rather than plan as much as you could dare, really. So again, you look at other platforms, it's, there's a big fanfare that you need loads of planning and need to spend ages working on your your offering. I mean, it's a bit like tech. You know, they have this concept in tech of a minimum viable product. We like to think Kofi is, is a bit like that. As your minimum viable monetization tool that you can then iterate on and grow. And I'd really recommend that kind of, put it doesn't have to be covid, but find a way to do something to monetize what you you do and iterate and get feedback really quickly. And I would also say, you know, it's kind of a balance spend. You got to spend a chunk of your time always building your audience, and you got to spend a chunk of time on your monetization business side. And it's, I guess, common sense, I guess that sort of keep them in step. You can't do all of of one and have, you know, a small group of followers and only focus on. Sizing what you're doing with with special content, without focusing on on growing the pool of, you know, fans and supporters. So keeping those in step with with how you plan your content and what you do is pretty key as well. Got it.

Ian Shepherd  30:13  
Got it. Really wise words there. And I've recently read a stat that There's 50 million kind of people who define themselves as content creators in the Western world, across the platforms, and 2 million who are earning kind of their living exclusively from being a content creator. So I'm sure we're going to see these numbers, you know, continue to grow. But it's, it's like, it's a real kind of economy that's blooming at the moment. Yeah. And I think a common misconception

Simon Ellington  30:39  
is you need to be one of the 2 million to bother doing anything, and that's just anything, and that's just

Ian Shepherd  30:43  
not the case, right? No, absolutely. And as we've kind of discussed with some of the examples you've shared, it's about these niches as well, where you don't need it's not about kind of the volume of your audience, but it's just kind of how engaged they are and even exactly what you're doing and and that's where some of the most creative creators are, and they're some of the some of my favorites are these ones that have, you know, two or 3000 followers, but actually it's just on a very specific topic that those 3000 followers absolutely love. So cool. Thank you. And so, how can someone find out about Kofi and and connect with you?

Simon Ellington  31:20  
Yeah, absolutely so kofi.com ko fi.com is, is where covid is based, and you can so you can go on there. You can set up a page in one to two minutes. I'd suggest try it that way, like try it by doing. But, yeah, you can. You can always email me as well. Simon@covid.com always you get attracted to creators. Any questions, etc, that way. Excellent. Well,

Ian Shepherd  31:44  
thank you so much for joining me today. It's great to hear about the platform and what you've been doing and the different creators, and hopefully we've inspired some more people to join. So thank you again, and it's great to have you here. So that was the first episode in the new business of creators. Podcast. I'm Ian Shepherd, co founder of electrify, video partners. If you've made it this far, thank you for listening, and please hit subscribe to hear more podcasts like this. You.