Breaking Down OnlyFans' Economics

Not a moralistic take, but one issue that interests me is the second-order impacts associated with the long tail of producers in OF who do not make a career from it.<p>With traditional adult entertainment, creators are aware of the social ramifications (e.g., social stigma, familial ostracism, difficulty dealing with the future, and so on), and there is a decent theoretical economic framework to measure that.<p>I am not sure if there&#x27;s the same this new army of &quot;civilians&quot; joining OF, let alone the additional toll it will take on the creators in terms of social ostracism, future prospects, future opportunities, and mental health.

Seminal article (I guess), <a href="https:&#x2F;&#x2F;xsrus.com&#x2F;the-economics-of-onlyfans" rel="nofollow">https:&#x2F;&#x2F;xsrus.com&#x2F;the-economics-of-onlyfans</a><p>&gt; It’s just as easy to imagine demand for the “real thing” going down due to the emergence of more substitutes as it is to imagine the premium for parasocial authenticity going up. And yet only Generative AI “creators” will truly do whatever “you” want and only for you. And unlike real ones, they speak in every language and are available at any time (and eventually, in immersive 3D).<p>Disagree. When (AI is) mentioned it has a negative correlation. Real content will fetch a premium

What I find fascinating&#x2F;disturbing with OnlyFans and in some way with Twitch and streaming in general is more the client side than the creators. Here are basically people paying, and paying a lot, for parasocial relationships. Because clearly it’s not about the content per see which is a dim a dozen and available for free in trove.<p>I think it says something quite dark about our society as a whole that we have basically commoditised distress and are encouraging some people often themselves in dire circumstances to prey on others to the benefits of the middle men. I find these new pimps scarier than the old sort in that they pretend to have clean hands.

I have a buddy how likes to tell how he &quot;had the idea for Onlyfans first&quot; but I advised him not to pursue it.<p>The reality is that OnlyFans wasn&#x27;t the first to try this model. You have to give them credit for successfully building the business, especially with several close calls between them and government regulations.

&gt; Usually, such a ban would destroy a media platforms’ business model, but browser-based experiences are fine for viewing photos and videos and sending messages (in contrast, most games can’t even run). And while apps tend to offer better user experiences and far simpler payment processes, most OnlyFans customers aren’t dissuaded by the need to use a browser, nor the extra hoops involved in manually entering a credit card number<p>This is a baffling section where the author goes out of their way to bash browsers vs apps. Maybe there are a lot of cons to apps that browsers don&#x27;t have. Basically all of the sleights against browsers in this section are not true. When I buy something from amazon, from my browser, I definitely do not need to manually enter my credit card in every time.

&gt; The company counted an average of only 42 employees in 2023, down from 61 two years earlier. During the year, it generated $31MM in net revenue per employee (13-28x that of Amazon, Apple, Google, and Microsoft) and $15.5MM in operating profit (27-560x).<p>This is the wildest part. One company that is proving all the &quot;why does &lt;company&gt; need 10000 engineers?&quot; takes true.

So this is a VC writing, observing that they have a stable, profitable business model. Creators get 80% of revenue, which is pretty good. It creates a moat - nobody taking a bigger cut is likely to get the desirable talent. Most of the creators don&#x27;t make much, which is normal for creative industries. Music and books work that way.<p>OnlyFans has only about 42 employees. They didn&#x27;t hire a bloated staff. That&#x27;s impressive considering the sheer volume of content that passes through their servers.<p>It looks like OnlyFans has figured out how to do the porno business in a more or less legit way. So what&#x27;s the problem?

<i>As an aside: OnlyFans 80% revenue share rate is practical only because it does not offer App Store-based billing (which would take 15-30% of revenue off the top). In fact, neither iOS App Store nor Google’s Play Store even allow for pornographic apps. Usually, such a ban would destroy a media platforms’ business model, but browser-based experiences are fine for viewing photos and videos and sending messages (in contrast, most games can’t even run). And while apps tend to offer better user experiences and far simpler payment processes, most OnlyFans customers aren’t dissuaded by the need to use a browser, nor the extra hoops involved in manually entering a credit card number (again, this is less true for casual games or ecommerce).</i><p>IMO the lede is a bit buried within the article. The idea that a non-app could survive this well within the strangling iOS system should come as a revelation to the greater iOS community.

&gt; These reports, which have not been independently verified, show her lifetime gross billings exceed $70 million, with Bhabie collecting $57 million. Over half of revenues were generated via paid messages with individual users (which may include custom audio-visual content).<p>I can see how 10&#x27;s of thousands of people paying $25 a month can generate millions but $25M on private messages in a year is over $70K a day - how many is she doing or how much do they cost each?

Is anyone willing to admit they subscribe to an OF and explain why over the free pornography alternatives that most of the internet is full of?

The widespread impact of the OF economy is obvious to many gym-goers. At my local gym you can see the usual assortment of bodybuilding guys (same as it&#x27;s been for decades), and then you can see 2-3 girls who are clearly trying to make it into the top 0.1% of hotness so they can cash in on OF (or maybe Instagram). This latter group is a recent phenomenon.

Wow - those AI generated influencers would be enough to fool older populations. If I was a shitty person, I would build my own network of “influencers” to manage and pump money from the lonely&#x2F;desperate.<p>Baby steps towards the “dead internet theory”

I find myself a little sad at how lucrative a job this will appear for an entire generation. $1500 average creator pay is higher than 40 hours a week minimum wage.

OnlyFans is run by a very small tight knit group of people. A while back, I sat at a poker table in vegas with one for 5 hours. We discussed technology and the future of OF. I was offered a job to run a technology team there - often think I made a mistake not taking it.

Two parts stand out for me:<p>1. COVID: The explosion in revenues during 2020 is self explanatory.<p>2. Product market fit&#x2F;Execution: The owners having previously created other, albeit, unsuccessful platforms certainly helped with creating Onlyfans. This is a very simple idea that thousands will have had, but creating it successfully necessarily requires a good understanding of a sector avoided by most major corporations.

This is why PornHub was sold to bag holders earlier seemingly out of nowhere. Their business is dead.<p>Second point - is this really Europe’s most successful tech company of the last 15 years?!

It&#x27;s really interesting to read the comments here — I would not have expected this type of moralistic attitude from such a large share of commenters.

My intuition makes me suspect that some money laundering must be taking place via OnlyFans donations.

I know it is pedantic, but could someone please enlighten me as to where does MM means millions?<p>It&#x27;s so easy to stick to international units, folks. Please. PLEASE!

It does seem like the business preys on, primarily teenage boys, in a way that traditional pornography does not.<p>If you look up the user demographics, you&#x27;ll notice an obvious problem: The demographics do not include the number of users under 18.<p><a href="https:&#x2F;&#x2F;techreport.com&#x2F;statistics&#x2F;software-web&#x2F;onlyfans-statistics&#x2F;" rel="nofollow">https:&#x2F;&#x2F;techreport.com&#x2F;statistics&#x2F;software-web&#x2F;onlyfans-stat...</a><p>Some may say: well that&#x27;s because you have to be 18 to use the site. But that&#x27;s not true. Anyone can signup for onlyfans without entering their age. Onlyfans only does age verification for creators.<p>If you think this site isn&#x27;t primarily being used by teenagers, then I have a bridge to sell you.

reading this thread, I am once again reminded that analogies are bad and that we should stop using them

Being a digital pimp is just as morally disgusting as being an irl pimp.

2&#x2F;3 of its revenues were from the U.S. That&#x27;s... sad.