Creator Economy Funding Bubble

Shaan Puri shares his perspective on the current state of the creator economy, particularly focusing on the disconnect between funding and actual business performance.

• Creator Economy Market Issues:

  • Currently oversaturated with tools and startups
  • Most creator economy startups are not very good
  • There's more funding going into creator economy startups than actual revenue being generated

• ConvertKit as an Exception:

  • Real, profitable business in the creator economy
  • Serves as backend for independent creators, bloggers, and newsletter writers
  • $28M in revenue with 34% growth
  • 36,000 customers with only 3.8% revenue churn
  • 11-12% profit margins

• Investment Perspective:

  • Valued at 7x revenue (~$200M)
  • Considered a "safe bet" with sub 5% chance of failure
  • Strong product defensibility - users reluctant to switch despite cheaper alternatives
  • Potential for 25-35% annual growth through acquisitions
  • Could potentially sell for 30-40% higher than current valuation

• Growth Strategy Potential:

  • Opportunity to expand into ClickFunnels market (>$100M revenue company)
  • Could add landing pages and sales funnels as upsell features
  • Long-term vision for 25 years of consistent growth

This represents a rare example of a creator economy company with solid fundamentals and clear path to growth, contrasting with the broader market's hype-driven dynamics.