Creator Economy: Digital Renaissance

Driven by the internet, a new market for the creator is growing. 

Known as the “passion economy”, companies operating in this market provide tools and/or marketplaces for a creator. These offerings enable a creator to meaningfully earn a livelihood from their creativity.

To understand why this market could potentially become compelling, history is a useful teacher. One of the most well studied periods of human creativity is the Renaissance, which was followed by an equally well studied period of the Industrial Revolution. 

While the Renaissance highly indexed on human individuality, the industrial revolution was a shift to the organization man. 

As we transition into a period of the Internet, there are learnings from these two periods which could guide us in understanding the growing creator ecosystem.

Renaissance: The Hallmark Creative Period

The Renaissance was a period of high creativity, largely restricted to Europe and specifically Italy. The center of this creative period was Florence. 

Why did it Happen?

The late 1300s had been of hardship due to the Black Plague, and defined by historians as the Dark Ages. In response to these tough times, people began to believe in the concept of “humanism”

‘Humanism is a philosophical stance that emphasizes the value of human beings, in this case, specifically as individual.’ This was a great motivator for people to be more enterprising and creative as individuals. It was one of the key factors driving the Renaissance, which was both a period of social and economic prosperity. The working class believed that the social class is no more the one controlling their lives.

The invention of the Gutenberg press and better travel allowed for exchange of ideas and wealth, which served as a great foundation for the Renaissance.

Supply Demand Dynamics

The demand for creative work was driven by rich individuals known as patrons. These would usually be kings, but also extended to city councils, popes, priests, and any other wealthy/influential people. The creator came from all walks of life, and could be deemed as talented, common men and women.

In essence, the economic structure was a monopsony, where demand was concentrated in a few and supply was large.

This provided great power, on average, to the patrons, who would set the entire outline for a particular creation. The job of the creator was to convert the visualization to physical form. 

Over time, a creator could become very well known (e.g. Da Vinci) and power for such individuals shifted to the creator. This behavior is visible even today in creative art forms with “megastars” (e.g. Shah Rukh Khan) and a long tail of actors.

The use case for the patron could be any or many of 1) signaling wealth 2) civic duty 3) personal consumption 4) showing influence. The patronage succeeded in professionalizing the creator, who became highly skilled due to their commissioned works.

These could be anything from paintings, tapestries, sculptures, machines. As a creator, you needed just one key patron and you would have work for years. 

Key Creator and Patron

As the structure of the creator/patron dynamic was a monopsony, few patrons had outsized influence on the Renaissance.

The largest of them was the Medici family, specifically Lorenzo Medici. One estimate puts the Medici family’s annual expenditure at more than 20,000 florins (approx. $20MM today) for the creation of various works. 

One of the largest benefactors of this expenditure was Leonardo Da Vinci, who at his peak earned 300-400 florins a year ($300-$400K), and enjoyed vast influence and compensation in kind as well. Other great creators of the time were Michelangelo, Erasmus and Dante.

This model enabled the widely practiced apprenticeship model, where a creator would employ unpaid youngsters to teach them how they worked. This was largely the mechanism of employment from the 1500s onwards till the late 1700s.

Creator led renaissance

Industrial Revolution: The Birth of the Organization

The industrial revolution was a period of change from an agrarian economy to manufacturing. This change also marked the shift from small apprenticeship to large scale mechanised production.

Why did it Happen?

The key driver for the Industrial Revolution was the invention of machines, specifically the steam engine. 

The steam engine was both an enabler of faster distribution, and faster production, something that the internet allows for content/goods today.

The center again was Europe, but this time the country was Britain. Britain’s rapid scientific, and technological advances were applied to its expansion as a colonial power. 

The unlocking of massive markets through colonization was both enabled by and accelerated the mechanization of production. This mechanization soon spread to other European countries and the United States, which was rising as an economic and technological force.

Supply Demand Dynamics

The Industrial revolution resulted in the creation of large scale organizations.

Due to the substantially lowered costs of production, driven by technology, groups of people (“organizations”) were able to produce more efficiently than individuals. This resulted in more demand being driven to organizations, subsequently lowering transaction and search costs. 

The Pareto efficient structure, conceptualized during the revolution by Vilfredo Pareto, would end up being the organization. This was because it was easier and economically more feasible for an individual to be part of an organization rather than an individual craftsman. 

The result of this was a reversal of supply demand dynamics, where the demand was fragmented, while supply was consolidated in the hands of few. This would result in the creation of monopolies, and the capturing of wealth by the upper classes. 

The leaders here would not be kings/priests but wealthy families and entrepreneurs. It resulted in the creation of the concept of the “organization man”.

The industrial revolution unlocked incredible productivity gains, with productivity almost 5x from 1850 to 1950.

Key Organizations and Markets

While the revolution started in the UK, organizations that professionalized and scaled organizations were in the US.

Key organizations that drove both technological, and subsequently organizational innovation, were Thomas Edison Co (or General Electric), Ford, Standard Oil, and US Steel.

At their peak, Standard Oil and US Steel were widely considered as absolute monopolies, displaying acquisitive behavior to become larger. When Standard Oil was broken up, it created 34 entities, some of which are the largest in the world even today. 

The two largest markets during the Industrial Revolution were the EU and the US. By the 1950s, organizations had become so ubiquitous that working for a large company was the way to guarantee economic certainty to your career. 

Passion Economics: The New Renaissance?

As we enter the 2020s, in the midst of a pandemic, there are parallels to the enablers of the Renaissance that could help unlock creative forces.


The Internet is the single biggest enabler of allowing people to do creative work and monetize it effectively. 

The outcome of the Internet is substantially reduced distribution and search costs. This allows an individual creator to both distribute and acquire customers at a price that makes it feasible for them to operate individually. 

The second-largest, and upcoming, enabler is the increased automation of jobs. Blue-collar jobs, which were the cornerstone of the Industrial Revolution, are being increasingly done by machines. Increasingly, basic white-collar jobs are also being automated. This is resulting in a large population of people looking for an alternate, or solo form of employment.


The market size for the “passion economy” in the US alone is estimated to be ~10Bn and growing at a rate of close to 20%

Creator economy

Large categories in this are music, text, and design, with music being the largest component. Text continues to grow rapidly in production, with more avenues of monetization being explored. 

Unbundling Organization Opportunity

The advantages of the organization which provided production and distribution scale are being destroyed, especially in creative fields. 

While organizations still provide economic certainty and predictability, solo entrepreneurs are increasingly willing to take the risks associated due to higher upside. 

Due to this, startups that are enabling the unbundling of organizations by providing organizational infrastructure to solo entrepreneurs are sprouting.  

These are across markets, and tap one or many parts of the organization value chain namely a) production b) distribution c) income d) admin e) collaboration.

Creator models

Content Creation Renaissance

The market where there is the largest potential for a creator to create value outside of an organizational framework is content. 

This is less likely to happen in products/services setups because of the inherent advantages that scale brings, which is not replicated by the internet. Creators in products or services who want to have small setups will need to tap high income low volume markets, very much like the patrons of the Renaissance. 

A content creator can tap a large volume of patrons, who are better categorized as “fans”. The use cases for these fans could be any or many of 1) association 2) insight 3) emotional connection 4) entertainment. 

Platforms that enable a creator today are either tools or marketplaces. Splits between tools/ marketplaces can be found in podcasts (Anchor/ Spotify), text (Substack/ Medium), video (TikTok/ Youtube). Most tools are rising stars in niches, but are yet to challenge the leading marketplace. 

Creator tools organized

The highest likelihood of finding a startup is going to be in a niche category, enabling the creation of “eternal” content. 

Eternal content, like blogs, books, videos, music tend to have higher economic lifetime value than ephemeral content such as tweets, snaps or jingles. It is therefore easier for startups to monetize if they enable eternal content rather than ephemeral content.

Monetization models are donations, ads and subscriptions. A creator makes money using a combination of all three.

Finding the New Renaissance Enablers

4 broad creative forms are digitally distributed, namely text, audio, video and visuals.

Defining Formats 

While many creative forms combine many of these 4, the categorization is done based on  what the primary creation format is. 

A very good proxy for the potential market size for each of these categories is engagement * users. 

Videos are the most engaging creative/storytelling format known to mankind, and therefore have the most market depth. As the video creative format is very deep, it is best handled by splitting into eternal and ephemeral categories that are described earlier. 

While each content format can be split into these two as well, it is akin to splitting hairs in comparison to video for this analysis.

Creator formats
Visual Design

The market for design services is valued at ~$160Bn. 

Visual creators, beyond the average camera clickers, are not in high density. Design is still a rare skill. Static visuals, while easy to consume, are hard to produce because it is a limiting format. Consumers, both retail and business, are willing to pay well.

Highly used enablers by visual creators are Canva, Photoshop, FineArtAmerica, and Behance. 

Eternal Video

The video streaming market size is estimated to be ~$60Bn. 

While quality video creators are also in low density, the flexibility of video as a format allows for the proliferation of a high number of video creators. High quality video creators have moved to platforms that limit UGC, improving the amount users are willing to pay.

Highly used enablers by video creators are YouTube, Netflix, Amazon Prime and Disney+.


The audio streaming market is estimated to be ~$25Bn

Similar to video creators, high quality audio creators are also in low density. While video is a flexible format, audio is a storytelling format that is possibly as old as humanity. This has resulted in the proliferation of audio creation as a skill (“music”). Digital streaming services have revitalized an industry temporarily devastated by piracy.

Highly used enablers by audio creators are Spotify, Apple, Anchor and Universal Music.


The content marketing market is estimated to be $400Bn.

Text is the most widespread storytelling format in the world. Almost as old as audio, its scalable distribution mechanism (“print”) was invented much earlier than music. Everybody who can write is a text creator. To elucidate, there are more than 500 million blogs in the world, or 1 blog for every 6 people online.

Highly used enablers by text creators are Whatsapp, Medium, Quora and WordPress.

Ephemeral Video

The revenue from ads on ephemeral video platforms is ~$20Bn

Ephemeral video is a new storytelling format, invented in the past decade. All enablers of ephemeral content are free, monetized via ads. People are unwilling to pay because the content has high temporal value, and little storage value. A natural progression for most of these enablers is livestreaming, and a potentially lucrative strategy to monetize attention.

Highly used enablers by ephemeral video content creators are TikTok, Snapchat, Instagram and Twitch.

Classification of Formats

To identify potential whitespaces in the creator ecosystem, we must look at each of the 4 content formats, split by tools/marketplaces and map companies based on their market position.

Marketplaces are platforms that provide creators the opportunity to market their creativity. Tools are software that enable creative output. 

In case the definition is fuzzy, where a technology company appears to do both, ask the question of whether you recall the creator’s brand or the technology company’s brand. In case you recall the creators’ brand, the company is a tool, while if you recall the tech company’s brand it is a marketplace. 

An example is “I went to Amazon to buy a shoe” to “I went to buy Steve Madden shoes on its online (Shopify) store”. Amazon is a marketplace, Shopify is a tool.

In each category, one can observe that digital marketplaces have a strong resemblance to distribution houses (production / record labels / galleries / publishers). They are now operating at a global scale, enabled by the internet. The digital tools are replacements of physical tools. 

Creator classification

Compelling categories for startups to build in are video (massive size), audio tools (whitespace), visual marketplaces (whitespace), text (massive size). 

Unlocking Latent Value

One may observe the massive value associated with Whatsapp, multiples of another widely used text tool WordPress. 

Tools for production of ephemeral text (“instant messaging”) are much more powerful than tools for production of eternal text (“blogs”). What Whatsapp essentially did was unlocking a larger creator ecosystem by making it low friction to create, while standardizing the format of the output. 

A lot of value could be unlocked in any creative vertical by making the production of content higher quality and requiring lower skill. 

The extension of this argument is that platforms will drift to either side of the spectrum namely flight to quality or flight to quantity. 

Platforms that are able to manage quality at scale can become very valuable (e.g. Whatsapp) and platforms that are able to distribute quality at scale can become very valuable (e.g. Netflix)