The $15B Creator Economy Opportunity That Everyone Overlooked
SMBs are the new content creators!
Recommended Reading:
SMBs Are The New Content Creators
A VC at a top-tier fund and I had a conversation that spurred the latest Creator Economy post, “Is The Creator Economy Still A Good Investment?”
This VC first introduced to me the concept of viewing Creators as the next “SMB market” that would be profitable to service.
While I proved that to be the case for a select few Creators, there was still the emergent opportunity to help Creators grow to that level where they could be serviceable by Creator Economy startups.
Towards the end of the post, I wrote this:
“…instead of content creators being the new SMBs, maybe SMBs are the new creators!”
Flipping the initial logic on its head, SMBs are the new content creators.
Take a close look at the article I linked in the quote (emphasis added):
“The very nature of TikTok is that it creates niche communities. This in turn allows small businesses to tap into their desired audiences much more easily than on other platforms. Finally, small businesses are fairly easily discoverable on TikTok given that one of the main tools on the app is a search bar. If you are a restaurant in, say, Austin, there no doubt is a niche audience on TikTok searching for, yep, restaurants in Austin.”
In that one paragraph, you can see two pillars of my Assay of the Creator Economy: Discovery and Community.
TikTok is excellent at helping new creators get discovered and assisting them in building their communities.
The proof is in the pudding, too. TechCrunch recently reported that “TikTok says it generated $14.7B for US small businesses last year.”
(Surprisingly, they didn’t link the primary source, Oxford Economics, backing their headline! You can find it here: TikTok: HELPING GROW SMALL AND MID-SIZED BUSINESSES AND DELIVERING VALUE FOR CONSUMERS ACROSS THE UNITED STATES.)
From the horse’s mouth:
“Our modeling suggests that SMB investments in paid advertising and marketing on TikTok drove $14.7 billion in revenue in 12 selected sectors in the US in 2023. SMBs on TikTok also placed a significant value on the free services provided by TikTok, which help them to grow organically.”
There are countless examples of virality on TikTok turning around the fortunes of SMB owners overnight. The latest one is 'The Dealership,' a parody of 'The Office,' rocketing a Chevy dealer to social media stardom.
Early-stage tech investors are not paying attention to this $15B+ market that TikTok has generated overnight!
But founders are.
Here’s an interesting company you should check out: Mystic Labs.
Founded by Daniel Ramírez-Yunqué (HBS ’15), Mystic Labs helps “ignite your business growth through online video.”
Might be worth paying attention to :)
Soda