Hacker News Reader

Comment by no1youknowz | Hacker News Reader

Frankly I am pretty happy about this.

Patreon has over leveraged themselves via VC investment and they have nowhere to go but up.

Creators are not wedded to middlemen, especially those who provide little value.

Other companies such as BitPatreon, SubscribeStar, etc have recently started to gain marketshare, albeit a small one. It continues to grow.

Princess Leia said it best: "The more you tighten your grip, Patreon, the more creators will slip through your fingers."

View on HN

Speaking of slipping through fingers. I signed up for Patreon and started donating $5 a month to the Godot game engine which I'm interested in. Soon afterwards I got a message from Patreon saying that my account was suspended for suspicious activity, and support told me I had to show a lot of personal documentation to get my account reinstated. "You must go out of your way to be our customer" they told me (in effect), I hope that works out for them. I just donate to Godot directly now.

What you're describing there sounds like normal anti-money laundering regulations that they are required to fulfill. Due to the nature of their business there will always be a certain number of cases where they have to investigate and seek documentation to show they're not just mindlessly laundering money, as they scale up those processes will scale up to. In the UK you basically can't deposit money into an online gambling website without submitting a photographic ID - it's just regulation.

There is always a second direction to go in addition to up.

Right, but their huge VC debt will force them to _try_ to go up, or failure will force them down.

What they can't now do, is what they should be doing - which is staying where they are.

I think this is an area where we will violently agree. There is a 'dead zone' of profitable, small companies that could exist but don't because of the pathologies of VC funding.

Its not dead, you just can't use VC funding to get there. There are still startups being funded by the pooled money of families / state grants / etc that can grow sustainably and so long as they can stay in the green answer to no one on future growth but themselves.

They've been using the VC money to buy up competitors (Memberful, Kit, Subbable).

We need to look more closely at business models like this, where a new technology starts gaining traction and insane amounts of money piles in to squash competition before it even begins. It's anti-competitive/anti-capitalistic and ends up hurting consumers in the long run as they force them to pay for the privilege of having nowhere else to go.