L. J. Amber
patreon
The Economics of Writing for Money on Patreon
🕑 Added 2025-09-23 15:59:56 +0000 UTCPeriodically, I get suggestions from readers that the price of subscribing to the Patreon is too high, and that it ought to be lowered, or the Patreon should have another, cheaper tier added.
Did you know that when the TEWWBAD Patreon first started, it had two tiers? And that the lower charged $2 for four chapters, and the higher charged $5 for six?
Would you believe that, when it switched to charging $10 for the main tier, the number of subscribers immediately went up?
It's true. Charging less for my work signalled that it wasn't really worth that much, which made people value it less, which made people less likely to support it. $10/month also happens to be the average price to read ahead for many successful stories on Royal Road and Scribble Hub, so the comparison factor was also hurting.
But there's another reason $10 is the minimum to charge. It's an awful reason, quite technical and boring, but the logic of it is inescapable. Read on to learn how the sausage is made... and welcome to my pain.
On Patreon, you can choose the currency you get paid in, and you set your prices in that currency. Patreon will convert your prices into equivalent prices in each of the other currencies people can pay in, and then charge them accordingly.
Sounds simple. However, your choice of currency matters in three ways.
Say you were to take payment in British Pounds Sterling (GBP), and set the Patreon charge to £10. The current (midmarket) conversion rate between United States Dollars (USD) and GBP is $1 = £0.74. Patreon would show prospective American supporters ~$13.50, and so fewer would then join.
Each payment made to Patreon has a fee attached. If you're paid out in USD, that fee is 2.9% + $0.30 per Credit card / Apple Pay transaction (Venmo is even worse). So for every single one of your paid supporters, you're immediately losing $0.59 (before Patreon takes its 8% cut). But if you were paid out in GBP? The fee would be 3.4% + £0.35, losing even more.
And when a supporter pays in a currency other than the currency you're being paid out in? Patreon charges 2.5% before everything else, to do the conversion.
Right now, 75% of my paid supporters are paying in USD. What this means in practice is that the Patreon has to take payment in USD to not deter people from joining, and also to avoid getting completely gouged by fees. The fees still really hurt, and the currency conversion screws us badly.
How badly? Let me give you a look behind the curtain.
According to Patreon, for September (in progress) we're currently looking at a gross revenue of $814.96. This is higher than it shows on the page because it includes people who joined then immediately cancelled.
$814.96 sounds good, right? Here come the charges:
-$54.37 Payment processing fee
-$5.64 Currency conversion fee
-$65.31 Platform fee
Meaning the actual earnings on that are $689.64.
Now let's convert it to GBP at £0.74 GBP per $1 USD.
$814.96 a month becomes £510.33 (actually worse, because to keep it simple I'm not including the fees that are charged for receiving the pay out and then making the USD to GBP currency conversion).
For comparison, my rent alone is £950 — and being disabled is expensive.
Doing the sums, to cover my living expenses and taxes at the current exchange rate, the Patreon would need a gross income (before fees) of somewhere around $3,550 USD. Subtracting the current paying supporters, that's another 280 paying supporters at $10 each, assuming the conversion rate holds steady.
We currently have a reader-to-supporter conversion rate of 6.4% (which is quite good, based on conversations I've had with more successful authors). This means that, on average, we need another 4375 people to read TEWWBAD to get enough paid supporters to cover living costs.
If the price of the Patreon were to be lower, that number would go up. And we already know, from experience, that slashing prices brings in less paying supporters, not more.
Ah, but why not have an additional, lower tier — say $5?
There was one. When the price of the main tier first raised from $5 to $10, the lower tier raised from $2 to $5. How many supporters were on it when it went away? Zero. We had a grand total of two people join at $5, and they both immediately upgraded to $10 (which is a huge compliment imo). When it went away, the rate of gain of $10 supporters went up, too.
But it's not merely that the tier wasn't popular, and that lower prices deter support. The fixed nature of the transaction fees (which are higher if you're charging less) mean that we'd gain proportionally less every payment.
Run it all together, and the result is that charging less makes for a longer climb at a slower speed. The best that can be done is running discounts periodically, to try to encourage people to join and then stick around. This sucks, and I very much wish we lived in a kinder, fairer world where everyone had more disposable income.
The good news is that, longer term, if I don't become homeless first, I'm confident we'll get there. There's also the prospect of income from book publication... but that's a long way off for TEWWBAD right now, since the logistics of doing that right mean we need to be 75% of the way through the current story before we can announce the first volume.
Additionally, publishing on Kindle Unlimited will require stubbing the relevant volume of the story on every other location, which will end the gain in new readers from anywhere other than Kindle. Bluntly, how many of the current ~2k readers do you think will buy the books and leave reviews on launch (which are necessary to boost a book's visibility on Amazon)? Probably around 50, if we're lucky; we really need 100.
In conclusion: trying to make a living as an author doing something that isn't what people already know they want is very hard, and the economics are getting harder. There aren't any easy solutions. I really wish there were.
Thanks for reading, and even more so for your support,
LJ
Comments
L. J. Amber
Who knows, maybe I'll take you up on that, some day!
Chester Antieau
Should TEWWBAD ever get a physical edition, I would gleefully stock it at the bookstore I work at.
Grafton Rentz
Thanks for the insight! I was wondering about this myself. A shame that the economics really are so brutal. My sympathies and my dollars to you (or as many survive the patreon transaction)
