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Comment by misterbowfinger | Hacker News Reader

It's hard to believe that Patreon didn't ask for feedback on this model initially. I'm sure they did, but my guess is that they didn't expect the blowback from people that depended on $1-2 patrons to have such a large impact on their image.

IMO, before Twitter/Facebook, this apology would've never happened. They would've continued to press on with their fee structure and it would've been yesterday's news.

The real question is - is this still a good move for them? Or should they have dealt with the blowback either way?

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> It's hard to believe that Patreon didn't ask for feedback on this model initially.

From their initial blog post announcing this change:

> In preparation for this change, we ran experiments and months and months of research to understand patrons’ potential reactions and we found that many patrons were happy knowing that this change will send more money to creators.

Looks like a somewhat interesting user-testing glitch to me. Perhaps their sample of patrons wasn't representive, or when you sit people down and discuss a new feature 1-1 you can be more convincing than when broadcasting it to the whole world in a blog post.

It sounds like they explained the asynchronous collection to the patrons without also explaining the implications for fees?

> Looks like a somewhat interesting user-testing glitch to me. Perhaps their sample of patrons wasn't representive, or when you sit people down and discuss a new feature 1-1 you can be more convincing than when broadcasting it to the whole world in a blog post.

Or perhaps we're all just a raving mob waiting for the right inputs, and early sentiment by influential individuals actually shapes our thoughts and actions far more than we like to admit.

It's also possible that we only make up 5% of patreons?

But that we are very noisy, because tech people on HN/twitter/etc. really want a micro payment solution for the web, to avoid ads.

I could also imagine that they didn't actually show the fee details, and just pitched it at a high-level.

As a patron, I'd be fine if Patreon just added transparency on fees, showing exactly how much reached the creator and how much went to fees, which is equivalent to "passing on" those fees. (They're effectively paid by the patrons either way, the only question is whether it's made clear what fraction of a pledge goes to the creator, what fraction to Patreon, and what fraction to processing fees.)

In my opinion, they made two critical mistakes here, and transparency on fees wasn't one of them. First, they un-aggregated charges, so that a $1 pledge costs $1.37, and ten $1 pledges costs $13.70. Second, they effectively increased all the pledges by individual patrons, rather than just being transparent about fees on the existing pledges. Effectively, they said "we're going to increase everyone's pledges by the amount of the fees (and hey, would you look at that, we get more money now)", rather than "we're going to show you exactly how much of your existing pledge goes where, without changing your existing pledge". Of course that led to a revolt.

> First, they un-aggregated charges, so that a $1 pledge costs $1.37, and ten $1 pledges costs $13.70

According to what I’ve heard, this was requested by credit card processors, because people would revoke the patreon charge, not understand why they’d be charged such a random amount every month.

Instead, they were supposed to charge every patron for every creator separately, and make it clear on the bill for which creator that is.

I fully expect that they will have to keep this unbundling.

I've seen no evidence or mentions of that particular rationale. They claimed they un-aggregated to support their "pay up front" model and start charging pledges on the anniversary of the pledge date.

They mention it below the original announcement, though they don't give any numbers.

> Not only that, but if you’re a creator on the monthly plan without the benefit of charge up front, you are constantly worried that your patrons are going to delete their pledges before they’ve paid.

That doesn't say it was requested by credit card processors. As I understand it, the concern there is that they don't want people to pledge, get access to patron-only content, and then revoke their pledge.

> This was requested by credit card processors...

Patreon, to my knowledge, has never said this. The move would be understandable if it were true, but they've instead offered different rationales (like "creators want to be paid out faster on new pledges"). If this were the reason for the new model, I can't think of a reason Patreon wouldn't publicly say so - it would've won a lot more sympathy.

Do you have any evidence this is the case?

> "creators want to be paid out faster on new pledges"

This is exactly the reason. The important follow-up question is: which creators?

Patreon supports two fundamentally different groups. One uses the platform for pure donations, where there are no exclusive perks to becoming a patron. This group doesn't care about faster payout because there's nothing riding on it.

The other group uses Patreon as a paywall platform. They care a lot about payout speed, to prevent people from joining quickly to gain access to the paywalled content, then canceling their payment before start of the next month.

The paywall group is where the money is, because Patreon's model doesn't provide the mutual assurance necessary to convince people to fund public (unrestricted, infinitely-reproducible) goods. And so, inevitably, the platform will cater to the paywall group.

Patreon should use a prepaid wallet for this group. It should continue aggregating for the first.

I'm happy to foot a 50c or so service fee per month. I'm not up for paying 35% service fees! That's outrageous and I'm confident someone else will start the right service and creators will simply move there.

I doubt most of the paywall group cares about payout speed.

They care about payout guarantees. That's not the same thing.

I like this idea of showing transparency. They screwed up by not letting the decision remain in the hands of the funder.

The top Patreon patron by far, Chapo Trap House, was adamantly against the change. I do question whether they really did adequate research.

Chapo Trap House has exactly one pledge level at $5+, which means this change would have probably benefited them financially. They'd be unlikely to lose many patrons upset about having to pay $5.50 a month instead of $5, and they'd be getting 3-5% more from each pledge due to no longer having to pay transaction fees on their side.

Do you expect Chapo Trap House to advocate policy positions because it benefits only them? That's, uh, not really their thing, is my point.

The point isn't whether they'd benefit, it's whether they're in favor of it when (possibly) polled.

You'd be surprised how many people would be upset at $5.50. Especially since that $0.50 is going to be multiplied by the number of creators a single patron supports.

For me it was enough to put "just pay an annual lump sum to my favorite creators and drop the rest" on my TODO list; I'm glad Patreon came to their senses.

It was the disggregation that seemed to piss people off the worst - which I doubt they pitched to people in their test groups.

Yea, could have been a botched user study. I've also seen situations where user studies were carefully crafted (and the questions worded) with a desired conclusion in mind, often in order to justify an executive's already-made decision. Not at all saying this was the case here, but that happens too.

Well, something that's gotten elided in a lot of the outrage is that moving the transaction fees from the creators to the patrons would have given creators 3-5% more money on the same amount of pledges. And while it seems "no duh" to point out that a $5 pledge is literally worth five times what a $1 pledge is, in terms of revenue, that means that many creators could have lost a surprising number of $1 pledges and still come out even (or even slightly ahead). I ran the numbers for several Patreons, big and small, based on what I could scour from Graphtreon, and the amount of money most creators lost over the last few days would have been largely offset by the money they'd get back.

I'm not saying that this makes the change a good idea, or that it was communicated well, or that there aren't some really interesting business dynamics that are likely to come up one way or the other that will piss off creators. (There are only six creators on Patreon who have more than 10,000 patrons as of now; to earn that $450M valuation, Patreon may need creators who have hundreds of thousands of patrons.) I'm just not convinced this would have been the Patreoncalypse.

We also need to consider that content creators might crave an audience just as much or more than the donations.

> something that's gotten elided in a lot of the outrage is that moving the transaction fees from the creators to the patrons would have given creators 3-5% more money on the same amount of pledges

Patreon really tried to make this "point". It is not actually valid; "amount of pledges" before the change is not comparable to "amount of pledges" after the change. Measured as a percentage of "money paid by patrons", revenues to creators fell -- they rose when measured as a percentage of "pledges" because the new fees weren't part of "pledges" while the old fees were.

If patrons on average adjusted their pledges under the new fee structure such that they were paying about as much money as they were before, creators would end up with less money on average, because the new de-aggregated fee structure results in higher fees as a percentage of the total amount paid in almost all cases.

> patrons were happy knowing that this change will send more money to creators.

That could depend on how they asked patrons.

If I was asked if I were in favor of more money going to creators, I would say yes.

If I was asked if I were in favor of paying more to make this happen, I would say no. If I want to send more money to creators, I would opt for a higher patron tier.

They ran a poor test and / or the internal politics were always going to prove out a certain result. There is value to qualitative research and I doubt the answer was to do a better job of A/B testing.

In addition to what others have said, this is almost surely a messaging issue. How you frame the survey and outcome is critical to getting honest feedback. I bet the surveys didn't detail exactly how things would be implemented and how it would be presented to the patrons. Instead, if you frame it as potential solutions that get your favorite creators more money, the response would certainly be positive.

The email announcement also didn't make the fee increase for 1$ pledges obvious.

On my first read I thought the fee was per transaction and that they would keep aggreting pledges...

It would have take the degenerate example to show that... And only a super honest business would show the edge cases.

before twitter/fb patreon would've never happened

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