Patreon may be in trouble

Apparently Jordan Peterson was keeping Patreon afloat:

Back when Patreon tried to change the way they charged fees for transactions, moving the cost to the supporters of the creators and then doubled down by charging them multiples of the credit card one off processing fee of 30 cents based on the number of creators they supported it set off alarm bells for me.

I called it a cash grab that they hoped would be borne by the patron’s so that they would not lose creators. Trouble is both creators and their supporters were pissed about it. They gave up on that idea.

Then yesterday Patreon’s cashing out system for creators to transfer funds to their bank accounts went down. I cried alarm. Why? The best way to hide a major cashflow crisis is to make it impossible for creators to remove funds but you can only do that for so long before it becomes a crisis of trust in itself.

I advised others that if you are creator you should be making sure that Patreon is not the sole source of income because it may just collapse and take your money with it.

Right now they have about 100,000 creators but their fee structure with that number of creators just cannot sustain the cost of the business.

It will be interesting to learn if Indiegogo is caught up in the same dilemma. Reports that Indiegogo has successfully raised $1.6 billion in funds for creators over 10 years would tend to suggest otherwise, as it would indicate that their annual income is on the order of $12.8 million, but neither their employment pattern nor their behavior is very consistent with a technology company in good order.

UPDATE: A Patreon creator confirms:

Hey creators,

As you might have noticed, payments are processing at a slower rate than normal, which means your patron’s pledges might take longer to process than they usually would. Our team is working around the clock to solve this issue.

This is frustrating, and we want to apologize for the delay in getting you your money. You will receive your anticipated total payout as soon as possible, and please know that we’re working as hard as we can to get our payments processing back to up regular speed.