Patreon's new Service Fee & Noclip
Hey Patrons,
Some changes are happening to the way each of you is billed and I wanted to clarify what this means for you and for Noclip.
As you know Noclip has always been transparent about the amount of funding we receive. We continue to show our full funding amount publicly on our page, and we're pretty open about how we spend it. So in keeping with that, we want to give you insight into what changes you shall see on your bill, and on Noclip.
The number you see on our Patreon page says how much we take home a month. At the time of writing it says $21,920. This is not the total amount you folks have given us. In fact it's between 89-90% of the funding you actually have pledged.
Up until now Patreon has taken 5% as a processing fee, and we as creators pay a processing fee for each pledge - usually to a credit card company. Patreon say these two fees combined means creators lose between 7-15% of their funding each month.
In the spirit of transparency I have attached a breakdown of how this affected us for the past few months. If you open the attached file (patreonNoclip.png) you can see that our processing fees are somewhere between 5-6% each month, meaning we lose between $1,500-$1,200 from our funding each month from these fees.
This is about to change.
Starting December 18th, instead of paying for two types of fees - we will pay a flat processing fee of 5%. However Patreon is going to charge each of our Patrons a smaller percentage of their fee. You can expect a new service fee of 2.9% + $0.35 to each of your individual pledges.
Basically our processing fees are cut in half,
but you're paying the Patreon cut.
Is this fair? I don't know.
Will Noclip get more funding as a result of this? Yes.
Will you be paying more for the same thing? No. Here's why:
We only found out about this change in the past few days but it rather elegantly lined up with a lot of plans we've been teasing for the past few weeks. Starting January there are going to be some changes to the amount of videos coming from Noclip, and the amount of Patron-only bonuses. In short, I'm getting help. We're going to have more people editing, filming and working on our output. We're also going to be adding some much requested content, and adding those to the various tiers.
My goal in 2017 was to steady the ship and create a steady output of content. Our goal for 2018 is to expand our influence, grow as a media outlet, and build a stronger connection with our community. I don't wan't to say any more right now but all will be revealed soon enough.
If you'd like more information, Patreon have created a post about the changes: https://patreon.zendesk.com/hc/en-us/articles/115005631963
If you have any questions, please put them in the comments below. I'll also be talking about this a bunch on our Patron Show this week.
Danny
TL:DR
- Your bill is increasing a bit.
- Noclip will benefit by getting back 5-6% a month in lost funding.
- We're expanding & adding more Patron bonuses to make sure you feel valued.
Comments (43)
I trust that Patreon is trying to do something they feel is appropriate, genuine good intent, but based on the bigger post I'm not sure why there would be a benefit to NOT bundling the pledges. Maybe it's expectations on those that pledge? Who knows. Unfortunately this has caused me to rethink how I pledge. Bad news, many of my $1 dollar pledges will be going away. Good news, Danny and Drew are going to get more money from me.
Patreon posted an update to their reasoning: <a href="https://blog.patreon.com/updating-patreons-fee-structure/">https://blog.patreon.com/updating-patreons-fee-structure/</a> . The gist seems to be that they want to charge patrons on the anniversary of their initial pledge instead of bundling the pledges to the 1st of every month. Hopefully, they add an option for patrons to continue to bundle their pledges, otherwise it still sounds like a straight money grab.
Seriously not happy about this, really considering my pledges. Already pay a premium being in Canada and having to pay the shitty exchange this really blows. I am all for giving the creators more but to start charging us on top is just shitty.
I've done some reading, both from creators on here and journalists covering it, and no matter what way I look at it this change seems really bad for people who chip in less than $5 or to a large amount of folks on here.
Unfortunately this creates a disincentive for people to pledge as patrons. Due to a percentage amount being taken, the higher you pledge the higher a fee you pay (and of course on the opposite spectrum, the small pledges of a few dollars increase by a proportionally large amount as well). In principle I am against this model change, as it puts more financial pressure on the patrons (directly affecting creators), and more delivery pressure on creators to deliver more for their patrons. I already have to worry about foreign exchange rate fluctuations paying from Australia into USD so this is another fee to take on. Of course I am going to stay a patron as I believe in your work Danny and I want to continue supporting you creating great content and documentaries, but it will probably mean I will have to pledge less. For this I apologise but I understand this is a decision out of your hands.
No need to apologies I totally understand. Thanks so much for continuing to support our work. We're working hard on it.
Am I correst that for a 10$ pledge I will now be paying 13.25?
Oops. That would be 25% not 2.5% Decimal points and all that... :(
Fair enough. As the third middle man in the contract after Paypal and my debit card company I think they could do better and charge approximately 3%. I should probably stop being lazy and using Paypal.
Sorry Danny, I had to go. My reasons why were summed up here perfectly. <a href="https://www.patreon.com/posts/15758286">https://www.patreon.com/posts/15758286</a> - What looked to be better for the Creators, actually ends up being better for Patreon. I will look to donate more directly in the future where these fees are up to your choosing the back end. People always say vote with your dollar, and I am, unfortunately you get hurt as well.
My support isn't going anywhere. You guys are killing it and the fee is worth it.
I hear you. We are always looking for the best way to accept support. In the past few months we set up our anonymous donorbox <a href="https://www.noclip.video/onetimedonate" rel="nofollow noopener" target="_blank">https://www.noclip.video/onetimedonate</a> and of course we have our merch store too. We will continue to look at other options as the business grows but at our scale right now the reality is that Patreon is the best place for our business. We will see how this all shakes out, but right now the best thing we can do is try to incentivize people to stick around and listen to their concerns.
I'll wait to see what exactly I end up paying extra before making any changes, not too concerned at the moment
Don't fall for this trick. The change was not made to help the creators, it was made because Patreon is greedy. They take $0.35 per pledge, but only pay that fee once to Paypal and the credit card companies. So they earn $0.35 for every additional creator you support. They hope that we still want to support the creators and because it's only a few $ per user we will accept it - but creators should look for alternatives. It's not good that users have to pay $1.38 + tax to give creators $0.95. Patreon should help to reduce costs of micro-transactions - instead they try to make additional profit. They take 31% fees for $1 pledges now!
I'm sure they made it for business reasons, but short of upping and leaving to another services there is nothing we can do. We actually talk to Patreon quite frequently on the back-end. They give us a lot of support in relation to functionality, bug fixing, business help and loads more. This is the one thing they have done which has bothered me - and what's worse is that it's not really affecting us - it's affecting you. In light of that I think the best thing we can do as creators is make good on the patronage people give us. I don't like the idea of getting tips for free. I want to earn your patronage. Seen as we can't change what's coming, that's what we're going to do. Seen as this makes the 1-$2 pledges a lot less appealing - we're going to add benefits to the $3 tier and above. We'll have news soon.
Thanks for the explanation. This seems pretty fine for noclip, but if you're paying $1 per item for someone who makes 5 things a week, that's a 35% increase.
Danny, I've had to stop my pledge. It wasn't much, but I feel bad because I love the content you have produced. Once my financial situation has improved, I hope to be able to contribute once again. Will continue to support you regardless. Dean @OldSnake79 twitter
Thanks so much for your amazing support Dean - it means a lot. No need to feel bad whatsover, thanks to you we've been able to make over a dozen docs this year. Hope to see you around on Twitter :)
It's an extra 59 cents, outrage, I'm pulling the plug... Ha, I kid. Thanks for the transparency and you guys keep doing you. Nice to see the extra hands will actually mean more output too :)
Thanks for the clarity! I only support a couple of patrons personally so it doesn't hurt me too much, though it seems like it could for others. Either way you're rocking it, extra content sounds amazing. Thanks for the hard work.
In the UK we have to pay VAT at 20% on top of our donations, so I guess that’s going to cost us even more. Still going to donate though and keep doing what you’re doing :)
Ugh, that's terrible. So sorry for the extra fee atop of another fee. But really appreciate the support.
More NoClip? FUCK YEAH
28?! Wow! Fair play, that's amazing. Though it's awful that has a mass-patron you'll suffer more than most. I think that's terrible for the community here on Patreon.
I am happy you're getting more of the donation money. I do wish it were structured how the Extra-Life donation are, where it asks if you want to donate X amount or X amount + processing fee. I bet most people would choose to cover the processing fee, but that would give them the choice. Also, that assuages any hurt feelings over paying a bit more.
Yeah that would be a fairer way of doing it for sure. Honestly even asking people how much sort of alleviates a lot of that in the old system. Larger pledges swallow more of the fees, but what can you do.
Good. I'm glad you guys are getting more money.
Thanks for sharing this. I may have to tweak how much I am giving to some of the others I’m donating to, but you guys getting more money is a good thing.
Thanks so much, it's sad of it affects people to donate to more Patreons which is one of the coolest things about this community.
Thank you for letting us know about this - but it’s concerning that this is the first I am seeing anything about this - why should Danny be the first to tell us this? Maybe I missed something but I didn’t see anything in my email from Patreon about this change
They were supposed to email all Patrons either yesterday or today. Check your mail settings just in case it's been switched off (though if you got our Update it's probably not that). They told us about it a few days ago so I wanted to make sure we were able to tell people ourselves too as there are many patrons on here who only support us on the system.
Running the numbers it looks like users who give a lot of small donations to many different accounts pay a lot more now... I'm not going anywhere, but I don't like it.
I don't mind the small percentage that it will go up but the 35 cents per pledge is lame. I can't spare too much these days but I like dropping a dollar or two to people that I appreciate. This seems like a bust for people who support a number of creators in small amounts like me. I understand it but I don't like it.
Nuh, don’t spill the beans! Keep them tight in the jar. I love Xmas surprises lol
I've put down the can opener
Meh, same thing in the grand scheme of things. I think this would affect those who pledge 1,000+ per month. For our max level of $30 the change is almost a rounding error. For smaller level contributors this is a substantial increase in percentage terms (for $1 - this is a ~40% increase) As I see it - Patreon is passing the CC fee along to patrons. Which I think is along what we used to seeing in every store or restaurant we go where we end up paying taxes and fees on top of the purchased product. I don’t know if it is “fair” but it is along the norms of modern day economies. Still here! Looking forward to 2018! I’m confident the quality of the content we receive here is well worth it. From what I read - sounds like Danny is planning to plow that extra cash back into content which is great.
Thanks so much Tohir - we're chomping at the bit to let you know what we've got planned now. I almost want to spill the beans early.
I appreciate you being so transparent. I feel really bad for small creators who will absolutely lose quite a few patrons due to this.
For sure. I support a number of smaller guys and it adds like 25% onto the bill. It's like a tip on top of a tip.
I don't love this. Not because I'll be paying more (I will keep contributing), but because I suspect many Patreon subscribers will drop their lowest subs to prevent paying more each month. I think this will disproportionately hurt smaller Patreons.
I assume it will especially hurt the smaller patreon donations. People giving $3 or less per month.
WHAT! unsubbed.
Honestly, do what's best for you. We don't want anyone to feel like they're patronage isn't worth it. That's critically important to us. We want you all to feel valued.