OnlyFans generated $300 million in profit on $400 million in revenue with 90 million paying users, vastly outperforming Patreon and even DoorDash on margins. The platform's early focus on adult content created organic word-of-mouth and a memorable brand, letting it stay private and profitable while expanding into mainstream creators.
All right, so today let's talk about how OnlyFans does $300 million in profit on $400 million in revenue. So this is interesting because OnlyFans has kind of really burst onto the scene in recent years, whereas a company like Patreon, which is also geared towards creators, they've been around for, I think, over 7, 8 years or so. I think over that time period, they haven't even— I think that that would be the total revenue that they've driven. So, you know, I think there's a couple of business and marketing lessons to learn from OnlyFans. But, you know, I'm just gonna pull up on my screen over here. This is from The Information, which is great tech news and something I— it's a subscription I pay for every year, so I recommend it if you're into tech. But you can see right here, they will earn $300 million in profits before— so it's basically EBITDA, call it whatever you want. And then they have 90 million users, which most which are paying subscribers. And what I find fascinating, so it's SaaS revenue, so it's subscription revenue, so investors love that. And, you know, I think the first lesson is this, right? OnlyFans started with adult-only content. That this is, you know, you might have adult stars that are promoting their OnlyFans and they're looking for a quick and easy way to monetize, right? Just get a page up, put their subscription content up there, and OnlyFans will be the middleman. And I think because they targeted that niche and there's a lot of, let's just say there's a lot of viewers for them. Well, you know, at the end of the day, a lot more people talk about it, right? And then you have people talking about, oh, you wanna check out my OnlyFans? So they're joking about it, right? It becomes a brand thing. It's like, oh, I just started an OnlyFans. Just started OnlyFans. Like, even if whether you're an adult star or not, it becomes this joke and they get free branding around that, right? It's not like Patreon where it's kind of, um, they weren't really targeting any specific type of creator. It was just creators in general. And also think of it this way, the word Patreon. So pay tree on, that's 3 syllables, right? OnlyFans. Okay. I guess they're kind of 3 syllables each, but OnlyFans seems a little easier to, to remember. So from a naming perspective, that's also, that also helps them, um, in terms of brand recall. So let's continue to scroll down here and we can see that, okay, here's what it says. The level of OnlyFans profit margins puts it in almost unprecedented class among the current cohort of tech companies. DoorDash, which went public this week, had roughly double OnlyFans revenue in 2019 but has lost $667 million during the current year. So these guys are profitable already. It's a great business, it's sustainable, and I think we're going to continue to see the creator economy grow. So whether people are producing content on YouTube, they can collect subscription revenue. Same thing with Patreon, same thing with OnlyFans, same thing with Substacks. People need more ways to generate revenue. And I think, you know, a lot of people are talking about this passion economy or this creator economy. I think this is good across the board because everyone gets a chance to create. And not necessarily— this doesn't mean everyone's going to be a star that's making millions of dollars a month, but it gives everyone a chance to generate some extra income, right? And so I think probably the biggest thing, so let's just pull this part up over here. OnlyFans has a better margin profile than similar creator-supporting startups like Patreon. That company, which has boosted its profile during the pandemic, recently raised a newfound round of funding that valued it at $1.2 billion. But Patreon only takes a far, takes a far smaller cut on creator sales through the service. Patreon will lose money this year. So look, OnlyFans started, when you think about Snap, Okay, first people were like, oh, it's only meant for sending nude pics. And when people looked at Bitcoin as an example, oh, it's a toy, right? So a lot of these times the internet was dismissed as a fad, video games were dismissed as a fad, esports was dismissed as a fad, and now it's a lot more respected. So a lot of these things start out as toys initially and they become much bigger than that, right? And I think even though OnlyFans started from that one niche, it actually worked in their favor. I don't know if they actually intended it to turn out that way, Great name, great industry to target. And now they've really expanded beyond that because a lot of people are like, oh, you know what? You have comedians that are hanging out there. You have Cardi B that's hanging out on there as well. And so, you know, is this sustainable? I think in the near future, definitely. But look, they don't need to think about going public or anything like that right now. They're just very profitable. They can wait a long time before they do that and then, you know, have a better outcome in the long run. So That is it for today. I think, look, I think, you know, I've talked about the rise of all these creator platforms. I think they're here to stay. I think, you know, the fact that these— this one's only— it's hugely profitable. And I've given numbers around my podcast before. So, with Marketing School, we've monetized that, we've created a community around that which we charge for. And there's a whole host of other things that we do too. We're planning to create an education system, but it's around this community. So, if I'm telling you with this little— this community that we've created that we're able to do amazing things, think about all the many mini communities that are being created around all these accounts with these OnlyFans accounts. So that is it for today. Before we go, go to levelingup.com to learn more about my book. And, uh, yeah, I mean, I mean, potentially even support me with it, right? So that is it for today, and we will catch you later.
