I’ve written before how Stripe, the fintech phenomenon aiming to be the Internet’s secret underground payment network, was also a very inventive content company.
While writing that I started to wonder: Do other companies that move money around the Internet also make content with similar ingenuity?
Thus began my next tumble down the payments and content rabbit hole, where payments and content combine to make new social networks as well as other, much grander, storytelling illusions. 🕳🐇
Content + payments = social networks
First, social media came to your computer. Then, social media came to your smartphone. Now, social media is coming for your wallet.
At the end of the 2000s, some stable geniuses realised that all the notes, in-jokes and references people added to their payments to each other on platforms like PayPal and online banking were an untapped gold mine of compelling content. They devised a new kind of payments app that was mobile-first, had enhanced user-generated content tools and displayed real-time payments data in a Facebook-like newsfeed.
And lo, the era of social payments was thrust upon us, enabling both outrageous fortune (attractive Instagrammers getting payments from thirsty followers) and sweet sorrow (local heroes making drug references in their payments to friends and being denied home loans).
Popular products in this category include:
- Venmo: Launched in 2009 to help people buy stuff at gigs via SMS, Venmo is the OG of social payments. It’s been owned by PayPal since 2013 and often gets grilled for its public payments feed, which creates a whole bunch of second-order effects for the users who like to make edgy jokes in publicly-viewable economic activity for the lols.
- Cash App: Owned by Square and public enemy number one for Venmo, the Cash App got mass uptake by accepting Bitcoin, mastering the art of viral marketing via celebrity cash giveaways, and plugging itself into the US Federal Government’s pandemic stimulus relief.
- BeemIt: Down under in Australia we have BeemIt, a joint effort from 3 of the ‘Big 4’ banks. It’s a decent attempt at social payments, with a fun UX, emojis baked into the design system (great minds! 🤓) and even a GIPHY integration so users can turn their reimbursements into GIF reacts.
Content + payments = magical illusions
Adding social media to a payments app is a great way to differentiate it with content. But user-generated content is unpredictable, requires network effects, and will probably need content moderation and a strong PR team when the trolls arrive.
Fortunately there’s another, much more Wizard of Oz-like content game you can play: use content and storytelling to create the illusion that your payments service is something other than it is.
That’s right. You can transform your humble payments service into something else entirely using only words and the power of imagination.
Companies in this category include:
- Patreon: A pioneer of the online fan-supported business model, Patreon’s brand and microcopy recall the art patronage boom of the Middle Ages and Italian Renaissance (a supporter, after all, is a ‘patron’ and they are paying for custom ‘creations’). In reality the company is two things: a file hosting service for exclusive content, and a payments bundler and processor. Every month, Patreon takes money from each patron and divvies it up among the creators they support. This is surprisingly fraught, as Patreon found out in 2017 when they tried to overhaul their payments system so creators paid less fees. Who knew bringing art patronage into the Internet Age would be so technical?
- Kickstarter: Like Patreon, Kickstarter uses thoughtful microcopy to drive home the story of it being a place where projects come to life. In Kickstarter parlance, supporters are ‘backers’ and their payments are ‘pledges’. The platform also provides content tools to let project creators do illusive storytelling of their own (Kickstarter does some due diligence to prevent fraud, but projects that fail to live up to their promise are hilariously common). Mostly though, Kickstarter exists to collect payments from backers and pay it out to project makers.
- Buy Me a Coffee: This Y Combinator-backed startup is building a payments business off the back of a single metaphor: donating money to content creators by shouting them imaginary coffees. Creators set up a profile on BMC, then add ‘Buy Me a Coffee’-branded buttons and links to their own websites and social media channels. Click any of these and you’re taken to the BMC-hosted profile where you can contribute $5-$25, depending on if you want to shout a “single coffee” or “five coffees”. It’s an incredibly novel use of storytelling, drawing on the cultural and social significance of coffee hangs to reduce friction for online donations.
Takeaways
1. Tying content to other value is golden
Layering content over a payments platform reminds me of the days when currencies were pegged to gold reserves. Your content is more powerful and consequential because the words are directly tied to another stockpile of value (even if that value is constantly moving from one party to another). Can the same be done with content experiences and storytelling that’s connected to other kinds of stored value? Does your content business need to build stockpile of its own?
2. Money becoming social media is a megatrend
As Lana Swartz points out in her amazing book New Money: How Payments became Social Media, money is merely information socially guaranteed to be valuable. Put another way, money has always been social media, it’s just been mostly offline social media until the invention of the smartphone. With that as a first principle, it was sorta inevitable that payment networks and social networks would merge, and I think they’ll likely keep merging and co-evolving well into the 2020s.
3. There may be more chances to pair content with payments
Given that Buy Me a Coffee was only founded in 2018 but has hundreds of thousands of creators on it already, I can’t shake the idea that there are other opportunities to layer more content and storytelling types over payments. Maybe starting with other IRL cultural norms, like the cards containing cash you used to get from your grandparents?
Counterpoints
“Pffft. Patreon and Kickstarter do much more than just payments.”
I agree! But their main reason for existing is to help one party get paid by another. Also, all payments companies do more than just payments. Credit card companies do a whole bunch of stuff for their cardholders. Stripe does business registration. PayPal paid US$4 billion for a web browser plugin that harvests coupon codes.
“What about crypto?”
A lot of what I wrote here could probably apply to crypto. Crypto Kitties, for example, is a clever use of gameified content on top of Ethereum. I’ll be interested to see what other content types get experimented with here too (a recent attempt to do it for journalism didn’t work out so well).
“I’m done reading about this kind of stuff. Can you write about another topic next?”
Yep, I promise I’m done with content and payments (for now).
Connections
A very short history of adding social media to other things
- Spotify: got early traction by hijacking Facebook’s newsfeed, has a social feed of its own, and integrates with Instagram Stories.
- Apple: launched its iTunes Ping music social networking service in 2010, failed, bought another ailing music social network for its killer app in 2018.
- Podcasts: Podcast player Breaker is trying to build a social networking layer for the world of true crime stories and comedian chat shows.
- Streaming video: Fun fact, social media hasn’t come to video streaming services like Netflix due in part to a journalist publishing a judge’s rental video history in the 80s.
Coffee-themed donations have actually been around for a while
SmallPDF, a Swiss document conversion service, had a coffee donation button for much of the 2010s before switching to a subscription pricing model. When the time came to retire the button, they’d racked up tens of thousands of donated virtual cups.
Stripe continues to power everything
It provides underlying payment tech to Patreon, Kickstarter, and Buy Me A Coffee. It’s good to be the king!
References
- New Money: How Payments Became Social Media, by Lana Swartz