Patreon lays off 13% of workforce • Hacker News Board

Re: Patreon lays off 13% of workforce

#111

Post by rtpg » Wed, Apr 22, 2020, 5:59 AM UTC

tempsy wrote: post #90

sk5t wrote: post #80

Earlier quoted context omitted.

Honestly, $600k/month for 300 knowledge workers is horrible revenue if growth and margin aren't on the right track. This is more like a "20-30 pretty decent consultants in a second-tier American city" number.

I think they make more than that. A TC article last year projected $50M in 2019. It also said they were not profitable. Even then that doesn’t exactly cover salary and benefits for 300 employees in SF, let alone everything else.

Wait, how does $50M not cover 300 employees? Is fully loaded cost of employees (I imagine most of those 300 are _not_ super high level engineers, but things like CS and admin) in SF really above $160k/employee?

Re: Patreon lays off 13% of workforce

#112

Post by manigandham » Wed, Apr 22, 2020, 6:00 AM UTC

TylerE wrote: post #66

rtpg wrote: post #44

Earlier quoted context omitted.

I feel like this sort of comment can only come from somebody who's never had to deal with operations. When you have a lot of users (especially when they rely on you to get money from you!) even 0.1% of them asking questions and having difficulties is a huge work generator! It's not "oh it's easy to write a for loop". It's "my for loop now has 20 non-orthogonal options, and a user is saying we emptied their bank accou…

If 0.1% of your customers cause 80% of your effort maybe rethink that retention?

That's usually balanced against how much money they bring in. If they are profitable customers then it makes sense to hire enough to support them.

Re: Patreon lays off 13% of workforce

#113

Post by 0zwan » Wed, Apr 22, 2020, 6:00 AM UTC

It seems they still hiring: https://boards.greenhouse.io/patreon

How is it possible?

Re: Patreon lays off 13% of workforce

#114

Post by edanm » Wed, Apr 22, 2020, 6:02 AM UTC

patrickyeon wrote: post #64

> In March, Patreon wrote in a blog post, “Not only are patrons not leaving the platform, we’ve even seen many of them upgrade their tiers to support their favorite creators during this challenging time.” Additionally, the average income for creators was 60% higher in March than in previous months, according to the company. > Around that same time, however, Patreon said it saw patrons exiting the platform more than u…

I'm totally guessing but I think there's simply a missing "most" in the first sentence:

> Not only are most patrons not leaving the platform, we’ve even seen many of them upgrade their tiers to support their favorite creators during this challenging time.”

Because as the second paragraph reminds us, there's always some churn. I think what they mean is, the churn rate went up a bit, but it's not increasing (though how they can tell from only one month is intersting).

And btw, it wouldn't surprise me if churn goes up, a lot of $1 tier supporrtes withdraw support to save money, but a bunch of higher level supporters increase their donation by a higher amount. E.g. if you're well off enough to support a creator at $10, you're less likely to need to leave given the current situation, and if you do incresae your pledge, then you won't increase it by $1 - you'll probably increase by $5-$10 at a minimum. So the average income could still go up even as churns are going up.

Re: Patreon lays off 13% of workforce

#115

Post by dannyw » Wed, Apr 22, 2020, 6:03 AM UTC

chipotle_coyote wrote: post #105

Patreon's problem, I think, is that they've taken enough VC money to be at a kind of "half-unicorn" status -- and there's no possible way for them to return on that investment unless they start wooing megastars to their platform. The majority of creators are always going to be way back in the long tail, but the folks at the top of the curve need to be bringing in a lot. Like, a lot. A million a month or more. And I c…

A middleware that can be described as Wordpress with access control and Stripe integration, but worse in terms of performance and UX; somehow takes on $165 million in funding [1] and describes their business model as "not sustainable" [2].

Patreon is a low touch SaaS platform that charges up to 12% PLUS payment processing fees. They do not provide any meaningful level of discoverability: you must build your audience yourself.

I wonder how the business would be doing if it disregarded that "raise money and spend money at all costs" model, that Softbank exaggerated? What if it had a WhatsApp-size of team: ~20 employees using sensible and well-architected tech stacks (not chasing the latest shiny thing just cuz its hip or cool)? I'm sure they'd be outrageously profitable.

[1]: https://techcrunch.com/2019/07/16/patreon-raises-60m-series-...

[2]: https://www.cnbc.com/2019/01/23/crowd-funding-platform-patre...

Re: Patreon lays off 13% of workforce

#116

Post by Kiro » Wed, Apr 22, 2020, 6:04 AM UTC

doctor_eval wrote: post #88

Friends and I were discussing this last night on jitsi. We think that instead of throwing employees to the wolves at a time when getting a job is going to be difficult, many employees would accept equivalent pay cuts to help weather the storm. In fact I know one company that did just this, with 100 employees. The staff chose a 10% indefinite pay cut over 10% reduction in head count. Sacking people at this time is awf…

In Europe most companies are doing this instead of laying off right now. It's a conventional practice that saved a lot of companies during the 2008 crisis and in many countries it's subsidized by the government.

Re: Patreon lays off 13% of workforce

#117

Post by dannyw » Wed, Apr 22, 2020, 6:05 AM UTC

zerm778 wrote: post #83

Patreon became successful mostly because of the girls charging money for their nudes. Then they've started to ban these girls because they wanted a clean platform. Guess what, these girls have now moved to onlyfans and they won't come back. Patreon has lost the money bringing members thinking that failed musicians/youtubers would bring them the big bucks.

Tumblr v2?

Patreon is not an advertising supported platform, so it can't be from advertisers. Onlyfans has no problem accepting credit cards; and Patreon is certainly at the scale where they negotiate with payment facilitators.

I'm curious why they made the decision... moral superiority?

If it's a brand perspective, then I think the biggest regret of Patreon in the coming years is going to be not spawning off their own Onlyfans, a reskinned and rebanded version of Patreon.

I wouldn't be surprised if Onlyfans is growing faster than Patreon right now...

Re: Patreon lays off 13% of workforce

#118

Post by Kiro » Wed, Apr 22, 2020, 6:06 AM UTC

ravenstine wrote: post #35

harryh wrote: post #14

Earlier quoted context omitted.

It's a good thing that millions of people have lost their jobs at what were otherwise well functioning businesses because of a global pandemic that also, by the way, is going to end up killing hundreds of thousands of people? Uh huh.

Patreon has millions of employees? Oh, your sarcasm is referring to the pandemic as a whole. Which I wasn't.

So how is it a good thing? What are you referring to?

Re: Patreon lays off 13% of workforce

#119

Post by danans » Wed, Apr 22, 2020, 6:08 AM UTC

baron_harkonnen wrote: post #85

Nextgrid wrote: post #9

I don't really understand why Patreon needs so many employees. We're talking about almost 300 people to just supervise a fully automated process. The tech has already been built almost a decade ago and hasn't changed much, so it can't require that much engineering work. It's also an easy problem (take X amount of money, divide it between Y people, pay them out) and they ironed out any potential issues over the years.…

> I don't know why X needs N people This statement can be made about almost any company in the US right now. There is some serious systemic risk in the surreal number of people working whose jobs do not matter at all. Even for productive software engineers, think back on how many projects in your career really shipped, how many of those then made any money, and then how many of those companies are still thriving. For…

> There is some serious systemic risk in the surreal number of people working whose jobs do not matter at all.

There is perhaps greater systematic risk in not having backups. Too much efficiency can equal a lot of fragility.

Re: Patreon lays off 13% of workforce

#120

Post by appleshore » Wed, Apr 22, 2020, 6:14 AM UTC

asiachick wrote: post #104

I have no idea about the financials of Patreon but their site leaves so much room for improvement. It's actually pretty awful. There are lots of independent artists running Pateron accounts with 200-5000 patrons. Fans sign up to support them but also to get access to their library of content. Patreon provides a piss-poor UX for getting to this content. There is no list of content. There just "here's the stream of pos…

The world is bad UX which I tend to think is a conspiracy.

For example, the Postmates driver app functions like it was programmed (automated) in a parallel dimension by toddlers in a thousand year future using an analog of Visual Basic. Then ported to iOS and ran via 480 API requests that transverse space, time and logic.

Nothing makes sense, everything’s broken.