How OnlyFans Was Able To Pay Creators $3 Billion Dollars


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Welcome to success story, the mostuseful podcast in the world. I'm your host, Scott Declari, and todaywe're going to go into the history of only fans. I'm going to breakdown how they were able to grow into the name they are today. We'regoing to break down how they were able to pay creators over three billion dollars. I'm going to tell you the story of their founder. I'm going towalk through roughly the four failures he had before he hit it big with onlyfans. This is a business case study, all right. So let's be real. The Internet has definitely changed the way that we live our lives.You can find almost anything online, including tons of porn tons of adult content, but only fans does it a little bit differently now. It's not tosay that it wasn't a smart business decision to get into that niche. PRENOGRAPHYwebsites get millions of visitors every day and in the pandemic they saw significant increasein traffic. Everybody's stuck at home with nothing else to do. But onlyfans was one of the first iterations of a company that was gating pornographic,porn adult content, whatever you want to call it, and it was ina very similar subscription model to what you saw with Patreon. So today goingto break down only fans. We're going to talk about the concept of gatedcontent, we're going to talk about their incredible growth strategy, we're going totalk about their founder, Tim stokelee. Let's get right into it. Sowe're going to start off with Glam worship. So in two thousand and eleven Timstokely spent his time partying around the world. He comes from a very, very well off family. He eventually pivoted from partying to using his family'smoney to try and start businesses. So he's now he's trying to become,you know, a little bit of a contribution to society. Wants to trysomething that may actually end up working out. So the first business idea that Timhas is called Glam worship. Now glam worship is a website that focusedexclusively on financial domination. Now, financial domination is a sexual fetish in whichsubmissives give gifts of money to a financial dominant. I don't know why thisis a fetish. I don't know why I would look for a reason togive my money away, but apparently this is something that people really get into. So the idea came to Stokeley when he stumbled upon a subreddit about financialdomination and, I guess, guys that were into this stuff. I don'tknow if women are into financial domination as well, but anyway. So hesaw how much money people spent on these experiences. And when I say guysbeing into it, I mean guys being the ones that are paying random strangersonline. It's I guess that's what he tapped into with the subreddit. Hesaw how much money people were spending on these experiences, but nobody was reallycreating products for this group of people that loved to Glam worship. Funded byhis family, he put a couple, you know, a couple tens ofthousands of dollars into this business idea and he decided to develop glam worship,develop the business concept, develop the website. What it offered, so glamorship viewersoffered, will rather sorry. What the platform offered was the ability forviewers and users to offer big money in exchange for playing out their wildest fantasieswith creators online, the performers. So the adult entertainers quickly took advantage ofthis. Opportunity and basically it was a cameo for financial dominance economy that startedto grow and blossom. So you would go into this platform, this website, and you would just pay money for whatever you wanted to have access to. Unfortunately, it was a mini economy and it leveraged twitter. So itleverage people building their networks out from their...

...twitter followings and what not to bringthem in, bring them into the funnel, but a mini economy rather that leveragedtwitter and Venomo started to remove glad worship as the middleman in this equation. So glad worship was the platform where people would come in and they wouldstart to facilitate these transactions and you'd have audience members and you have creators andthat was that was a community. But because now you had the ability toconnect with these people, glam worship, the business model was to basically askim fees off these transactions. So of course, if you have the contactof the person that you are paying to do whatever and you realize that,hey, instead of doing this on Glamorship, why didn't I just go over totwitter? I can you know, we can just chat on twitter,I can dm you whatever I want and and I can, you know,send videos or pictures via twitter or any other snapchat doesn't matter, and thenI can just ven. I can then know you the money. So what'sthe point of Glam worship? Because now I actually cost me less and Iget less fees, or perhaps the creator gets to keep more of the money. That the that the person is sending them. So glam worship doesn't reallymake sense anymore. Just seems like something that can be removed. So sowhat it started to happen with this new mini economy that was being built onthe back of Glam worship is users would view content on Glam worship and thenthey would reach out to the performers on twitter, because again, the performersbasically brought in their following the glamorship through their twitter followings and their social followings. And then, once they reached out to the performer on twitter, theywould request a video and then they would pay the performers in Venmo or paypaland then they would receive the video. So this basically allowed users to bypassthe fees that resulted in the profits, in the revenue for Glam worship.So obviously this wasn't great stokey wasn't happy with this. He saw the hesaw the fact that people were just avoiding and circumventing the platform. So itkilled glamor ship. But he wasn't done yet. He still wanted to buildsomething that had some legs to it, so he started a new company andit was still focused on creating exclusive content. So second company He created was customsfor you. So instead of users independently finding finding performers on twitter,contacting them and arranging payments, customs for you handled all of the transaction.But to keep people on the platform you had to focus on volume. Youhad to focus on getting as many people into customs for you as possible because, again, if you didn't have volume, there is still easy ways to circumventand just go direct to the performer. So he focused on volume the secondtime and the performers were still not happy, because this lowered the barrierto entry into the industry. It's saturated the market with new performers and itmade the niche very competitive. So the basically the largest performers or adult entertainersthat basically could have made this plat are driven awareness to this platform. MadeCustoms for you more wellknown. They basically said, listen, you're catering topeople that are just getting started, which is fine, but we want towe want to put our work on a platform that favors people that have somesort of tenure in the industry, that have some sort of following, somereputation. If you're just focusing on people that are just getting started, that'sfine, but then we don't want have anything to do with it. Sowhen you have your, you know, your biggest advocates and influencers in theindustry saying, you know, I don't really care about it, it's notgetting the traction that you want, because that that in and of itself isreally hurting your marketing and your growth efforts when you know the people that youreally want to champion your platform really don't care about it. So stokeally killedthat. After customs for you, he started a business called one hundred andtwenty one with. Now one hundred and twenty one with moved away from adultentertainment and then he moved still. He was still trying to figure out howto connect and create market places and communities, but this particular this particular business wasnot focused on adult entertainer so for... hundred and twenty one with,the concept was for Tradespeople to sell their expertise on an audio or a videocall. So if I need a plumber or if I need somebody to perhapshelp change a tire, instead of bringing somebody out and hiring a specialist,which is you know, it can be expensive just for a small job,maybe I can do a video call with that specialist and they can walk methrough what I need to do myself, so that it saves me money.It gives the specialist scalability because now they can charge hourly rates without leaving theirhouse and actually going on site to do work. So it's a win whenthe client says a little bit of money, but it also allows the specialist toscale their service. So one hundred and twenty one with similar to customsfor you, although different industries. They leveraged the Creator Fan relationships as wellas, like the the professional fan relationships. It for no, no real reasonother than it perhaps wasn't the right time or it wasn't it wasn't takento market properly. One hundred and twenty one with also failed. Still couldn'tget the traction, couldn't get the cripple mask couldn't get as many people onthe platform as stokely wanted, so he killed it. So this is threefailed businesses at this point. But, as you can see, the modelfor only fans is starting to develop. He understands the power of building community, he understands the power of Gating, he understands the power of facilitating paymentsbetween creators and professionals and the audience and the users. But he just needsto figure out how to bring all of these pieces together. And that's whathappens with only fans. So soaklely took some more time off. So thisis again, this is the third business venture be well, he's failed withthree business ventures and then eventually he gets, you know, he gets only fans, and we know where that ends up. But he takes some timeoff. He goes back into adult entertainment because, if you remember, onehundred and twenty one with was just with Tradespeople, not with adult entertainment orthe adult industry. So he still wanted to get into the adult entertainment industryand he also saw an opportunity because you saw a lot of social platform.So at this point when he's building this out. INSTAGRAM is massively growing inpopularity for content creators, for influencers. Many adult entertainers try and use itto post videos or pictures to promote themselves. But instagram is banning these pictures,banning these accounts, banning these users, so they don't have a social platformto publish their content. Because now what are you going to use?Your going Linkedin band, facebook, band, instagram, band. Twitter actually doeshave some adult content on it, but twitter is not a visual form. It's really focused on tech. So the best place for visual content beforeonly fans, was instagram. Creators were not welcome there. So this gavestokely the idea of building a paid social feed like instagram or twitter, obviouslyfocused on visual where creators can earn money directly from their content. In Twothousand and sixteen he launched only fans and and let's just pause for a second, because let's not forget that most of the most of it. I'm doingthis, I'm doing this case study in two thousand and twenty one right,like, I've only heard of only fans in the past, maybe a year. So even though now it's it's obviously successful. It took him four tofive years to get it to the point. After, after, after, afterthree, three fails, three failures, so that he had a successful business. There's a lesson there, anyways. And two thousand and sixteen he launchedonly fans. Here, viewers would pay subscription fees rating from five tofifty bucks a month access content created by performers. Only fans receive two twentypercent cut of the subscription. Creators received the rest. And let's be real, like the the reason why only fans was a success because of the experiencethat stokely gathered from all of his previously business ventures. Through Glamorship, thecompany gained insight into the concept of paying...

...performers directly for special video requests.Meanwhile, the initial only fans customers came from customs for you. But thebusiness model evolved with one hundred and twenty one with the early days of onlyfans revolved around enabling creators to upload custom content. By tailoring their content totheir audiences preferences, the creators built incredibly close relationships with their followers, somethingthey were not able to do on any existing major social media platform. Nowlet's talk about the way that only fans grew. So the first strategy theyused was a highly effective referral strategy. Stokely and the only fans team didn'tjust want people that would use the platform, they wanted people that would they wantto users on the platform that would contribute to the platforms success and growth. Turn your customers into your evangelist. So, therefore, only fans createdan incentive structure and affiliate structure, for lack of a better description, thataligned the platforms goals to encourage users to recruit the right people. The keyobjective of this referral program was quality over quantity. So I wanted if Ihave a user on my platform, VI have a creator, content creator onmy platform, I want them to get other like minded professional content creators ontothe platform, because they all run in they all run in these same circles. If you are in an industry, you will know other people in theindustry and you'll know you'll have connections just any industry. This is how itworks. So stokely knew this and he knew that if I could incentivize thecontent creators to speak to their friends, their peers, other people in inin an industry, they can bring them onto the platform. So what?Only fans. Did they set up an affiliate program? Five percent lifelong revenueshare. So if you recruit someone, for example, who makes a hundredthousand dollars per year on only fans and keeps them on the platform for fiveyears, the company only fans will pay you twenty five thous on top ofthe fact that you are still making money from your audience members. So that'sthat's an incredible affiliate program for a social media platform because, yes, aphilly programs exists in other industries and in other ways, but for social mediathere's no affiliate program to get somebody to sign up for instagram. There's noaffiliate program to get somebody to sign up for Youtube or for facebook or forLinkedin or for anything really. So this is a little bit novel for Socialand the affiliate program work. This is this was this was a good strategyfor Tim and the only fans team creators were creating content, but they werereally trying to get into other people's revenue potential by sending affiliate request invite,getting their friends in, getting their peers in, because they tapped into thatrevenue share. So a very smart, effective or for Ol strategy by TimStokeley and the second the second way they really focused on growing only fans isthrough the use of twitter. So they created a product called fans scope.Now, fanscope was the first product that only fans developed to help creators leveragetheir twitter following. Because, remember, a lot of these creators they wereeither they weren't very prominent on other social media platforms or they were banned fromother social media platforms. So fans scope was basically a live version of cameo. That's the best way you can describe it. Creators can start a fanscope session through only fans and have the link automatically posted to twitter. Sothen now you're live session receives exposure from your entire twitter following, which isagain where some of these creators had their largest audiences. and to watch thelive stream, the twitter user must click the link and sign up to onlyfans. Now this strategy brought more people to only fans, brought more audiencemembers to creators because it lowered the barriers to entry. So new users,who could potentially be new content creators or new users who could just be contentconsumers, could sort of test and see what they could expect from an onlyfans page before they started investing any money.

So again it's all about teasing peopleinto a platform. How do we find ways to get people in?Let's tap into where the people already are and bring them in. I don'tneed somebody to I don't need to when I'm marketing something. For example,say I'm a content creator and only fans, by marketing myself. I don't wantto have to first get, you know, Joe Blow to care aboutme and then I have to get joe blow onto only fans. I wantwant to go to you know other you know John Doe and who's already followingme on and on twitter, and I want to say hey, I'm alsoover here, because John Doe already knows who I am. Joe, youknow, Joe Blow doesn't know who I am. So I want to bringin people who already know me because it's an easier it's an easier way tobuild my audience and only fans with people that are already care about me.So the integration between existing social platforms is very effective for that reason, becausethese people already like your content and you're just moving them into another platform witha very low barrier to entry. You're making it easy right now. Thesetwo strategies really paid off. Of course, we started off in two thousand andsixteen, but these strategies were just ramped over the year. So,in contrast to other live platforms, only fans saw addle performers as assets.So instead of prohibiting them, as we know, the company empowered them.And this was empowering a niche group of content creators that really were marginalized bymost other social media platforms. So, as a result, they never restrictedaddle content. They encourage the creation of unique content, and this, alongwith their growth strategy and the fact that nobody else was really serving this targetgroup of content creators, saw only fans grow incredibly fast. In Two thousandand eighteen, Leo Radvinski, who's a Ukrainian American web entrepreneur, he builta fortune with a website called my free cams. He was able to buyseventy five percent of only fans, and then after that the company just keptcompounding and compounding. And then now, fast forward to two thousand and twenty. Only fans success soort tremendously when celebrities began to publicize it. Beyonce wasnamed dropping it in her Song Cardi beat joined the platform. These are someof the major celebrity events. Is started to accelerate only fans growth. Nowtoday, only fans has now paid a creators more than three billion dollars andthey have over a hundred and twenty million active users and it's very it's worthnoting that the vast majority of only fans creators today are adult entertainers. Thatwas the marginalized group that they built their community on. But the company isnow taking their success and they're trying to build it out to a wider audience. So, for example, they just launched a creator fund of Twentyzero Pounds, or twenty seven thousand eight hundred approximately US dollars, to help for aspiringmusicians kick off their careers, and they're doing more initiatives to bring in othersegments, other types of content creator. So will it work? Will haveto see. But that is the story of only fans from when they startedto today, and incredibly interesting and a lot of entrepreneurial lessons. Regardless ofwhether or not you're into the content, doesn't matter. The fact that I'mgoing to actually I'll break down I'll break down four lessons so we can sortof itemize some of the main things that we that we saw Tim do andthat led to only fans success that are basically industry agnostic, transferable to anyindustry, any type of start up or entrept trepreneur. Let's go into it. So for lessons from only fans, Tim stokely had multiple failures before onlyfans success. Most overnight successes take years and that's true in any business startedby almost anybody. So just a lesson there and something to think about ifyou are doing your own thing. Another lesson as something is not favored bya larger market. Sometimes there's a reason for that, but there could alsobe a potential or an opportunity for business. So Tim saw a need for amarginalized market segment. All these adult entertainers were kicked off other social mediaplatforms. He gave them a platform, he gave them a community, andthat's what that's what was the core that...

...built only fans. So look forunderserved, under appreciated market segments. It's a smart idea to see if youcan find a way to tap into that and to create a product, aplatform and a community that helps an underserved segment third lesson growth strategy. Getyour customers to sell for you. Only fans launched a highly lucrative referral programwhich brought people onto their platform, allowed content creators to bring peers into theirplatform. Money talks. Align you align your audience or your customer rather,align what customers want with your business growth goals. What do customers usually want? There's a variety of things, but I mean for content creators, revenue, money, like they need to make money. There could this is whatthey do for a living. Any content creator is trying to find new waysto make money, especially when your first starting to create content and you're startingto build a name for yourself. So what only fans did? They justcreated an affiliate affiliate program that tied the goals and objectives of the content creatorto the goals and objectives of the business. You bring in more people, that'sa business goal. You bring in more content creators, that's a businessgoal. Will pay you, will pay you money. That's that's that's acontent creator objective and goal. So very straightforward. Not many other social mediacompanies did this, and only fans basically just wasn't greedy. And Fourth Lessonthe fact that they leveraged existing twitter followers. This is a smart marketing strategy,and let me sort of describe how you can conceptualize and think of thisfor any business. So what only fans did, remember, they just said, okay, we're going to let you access your twitter following. The lessonhere is, if you're trying to market anything to anybody, make make themarketing and make the make the ask of the individual as simple as possible.What I mean? What do I mean by that? So what only fansdid is they said, okay, we know that your audience is already ontwitter, they already like you. All we have to do is get themfrom twitter to only fans, as opposed to we're going to get people toknow about you who've never heard about you and then we're going to move youto only fans. So they just said, let's just happen to what's already there. So this so let's bring this out to other business use cases.If you're trying to find customers for your product, if you're trying to I'llI'll use you know, I run a podcast. I'll talk about that.So when I'm trying to get listeners to my podcast, who do I tryand reach out to, who do I try and advertise against? I usuallyadvertise to one of one of two segments. I'll advertise to my audience on othersocial media platforms that may have not heard about my podcast, because Iknow they already liked me. I just need them to know that I havea podcast. or I'll advertise to listeners of other podcast because I know theyalready like podcasts. They just don't know about me. What I don't wantto do, and I don't really care to do, is I don't reallycare to advertise the people that don't know me, don't like me, don'tknow or listen to podcast, because then I have to get them to likeme and then I have to get them to like podcast. It's much easierto market to somebody who already likes me or to already who already likes podcast, because there's only one more step that I have to do. If I'mtrying to find net new people, then there's two steps. I got toget them into me and and to podcast, and it's a bigger lift, it'sa harder cell. So just make it as easy as possible and tapinto existing tap into existing followings, existing communities, existing customers. Another strategyonly fans could have done is they could have said, well, let's justcross and they probably actually do do this. They they can just cross promote betweencreators. So if you already are subscribed to, you know, contentcreator one on only fans, well, why don't you go check out contentcreator to one only fans, because you obviously like this type of content.So again it's all about just tapping into adjacent communities so that you don't haveto make a big ass and you don't have to move somebody too far toget them involved in your product or service or business or to consume your content. I hope that makes sense. And last lesson. I cannot reinforce thisenough. Tim Started. I thought it was for I guess when I'm,you know, going through this case study again, I put it together awhile back. It's actually three businesses.

I'm sure there was other stuff thathe didn't mention just because it honestly, was probably just such a massive failurethat he didn't. He hadn't even gone on on record publicly about talking it, talking about it or building it. But three notable failures. So ifyou don't give up the timing will eventually be right. What do I meanby that? Will Tim launched multiple businesses? Any of those could have hit,could have worked out, could have failed. Also, one of thereasons why only fans really, really really got massive amounts of traction was dueto the fact that there was also a global pandemic event that led to morepeople being online, being at home, looking for alternative places to consume thistype of content. So, if you think about it, why was whywas Tim Lucky? Why was Tim lucky that a celebrity name dropped his platformin a song? Why was him lucky that everybody was online and online activityand people searching for different you know, adult content, whatever, increased dramaticallyduring a global pandemic? It's because he kept going. It's because he wasbuilding things for years and years and years and years. And you'll notice thatwhen you continuously built stuff, opportunities luck, you'll start to you'll start to runinto it a little bit more. So, if you think you're notthat lucky, if you think the timing isn't right, keep going, keepbuilding, keep trying and eventually, if you put the time into something andyou put in the effort, the timing will eventually be right and luck willeventually find you, and this is just because you haven't given up yet.So really, really great lessons from this story for any entrepreneur. Yeah,he started with some maybe some family money, and we don't all have that luxury. But that being said, he could have started with family money andgiven up after the first venture and just gone to work for somebody. Orperhaps he has so much family money he never would have had to work.I don't really know. But the point is he didn't give up. Andthen when he didn't give up, over years and ITERATIONS and trying and failing, then all of a sudden something hits. Now everybody's looking at him like he'slucky, like the timings right, but it's really just because you didn'tgive up. anyways. That's it for the only fans story. I hopeyou enjoyed. If you like this, share with your friends, family,peers, co workers, anybody who you think would find this interesting. Ifyou're listening to this on itunes or spotify, leave a review. If you're listeningon Itunes, if you're listening on spotify, leave a follow. Ithink those are like the two algorithm metrics that matter if you're watching this onYoutube, hit that light button, hit the subscribe button, leave a commentfor the Algorithm, and you know I appreciate you. That's all I cansay. Have a great day. Hope you enjoyed talk soon.

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