Patreon

Discord

Patreon

Patreon takes a percentage of every payment processed through the platform — 5% on the Lite plan, 8% on the Pro plan, and 12% on the Premium plan. Each tier offers progressively more features: merch integration, team accounts, priority support, and dedicated partner managers.

On top of the platform fee, payment processing fees (typically 2.9% + $0.30 per transaction) are passed to either the creator or patron depending on the plan. The combined take rate means Patreon captures roughly 8-15% of the money flowing through the platform.

The business scales beautifully. More creators attract more patrons.

More patrons increase creator earnings. Higher earnings attract more creators.

And Patreon's cut grows proportionally with every dollar processed. Annual payment volume exceeded $3.5 billion in 2024.

The company has been cash-flow positive since 2023.

Discord

Discord makes money primarily through Nitro — a $9.99/month subscription that gives users bigger file uploads, HD video streaming, custom emoji, animated avatars, and profile customization. There's also Nitro Basic at $2.99/month with fewer perks.

Server owners can pay for Server Boosts that unlock premium features for their community. Discord also added a cut of server subscriptions — creators can charge monthly membership fees and Discord takes 10%.

The key insight is that Discord's core product is completely free. Voice chat, text chat, screen sharing, communities with thousands of members — all free.

Nitro is cosmetic and convenience upgrades. Most users never pay and Discord is fine with that.

The free users create the network effects that make the platform valuable.

Patreon

Jack Conte was one half of Pomplamoose, an indie music duo that went viral on YouTube in the late 2000s. Their cover of Beyoncé's "Single Ladies" got millions of views.

Their original music was critically praised. And they were barely making enough to pay rent.

The math was brutal. A million YouTube views paid about $1,500 in ad revenue.

Conte spent weeks producing high-quality music videos that cost thousands to make. The economics didn't work.

YouTube's ad model paid creators fractions of a penny per view. Spotify paid fractions of a penny per stream.

For mid-tier creators — popular enough to have a real audience but not famous enough for brand deals — the internet was a machine that turned creative labor into pennies.

In 2013, Conte teamed up with Sam Yam, a college roommate and developer at AdRoll. Their idea was simple: let fans pay creators directly through monthly subscriptions.

Not per-video donations. Not tips.

Recurring monthly payments — like a Netflix subscription but for individual creators. They called it Patreon, from "patron of the arts." The platform launched in May 2013 and signed up its first creator the same week.

Discord

Jason Citron had already built and sold a gaming company — OpenFeint, a social gaming platform for mobile, which GREE bought for $104 million in 2011. After that, he started Hammer & Chisel, a game studio that was supposed to make mobile games.

The game they built, called Fates Forever, was a mobile MOBA that got great reviews but almost nobody played.

What Citron noticed was that gamers were using terrible tools to communicate. TeamSpeak was clunky.

Skype was laggy. Nothing worked well for groups of people who needed to talk while gaming.

The internal voice and text chat tool that Hammer & Chisel had built for their own team worked better than anything on the market.

Citron and co-founder Stan Vishnevskiy pivoted the entire company. They stripped out the gaming stuff and launched Discord in May 2015 as a free voice, video, and text chat platform for gamers.

It spread through Reddit first — a post on the r/gaming subreddit went viral and crashed their servers on day one. Within a year they had 25 million registered users.

Patreon

Patreon grew through creator evangelism. When a podcaster or YouTuber told their audience "support me on Patreon," that was free marketing to exactly the right audience.

Every creator who joins becomes a distribution channel.

The platform expanded beyond its indie roots by courting bigger creators. Podcasters were the first breakout category — shows like Chapo Trap House, True Crime Obsessed, and Last Podcast on the Left built six-figure monthly incomes on Patreon.

Then YouTubers, writers, musicians, and visual artists followed.

International expansion drove the next phase. Patreon now supports payments in multiple currencies and serves creators in over 180 countries.

The creator economy is global — a manga artist in Japan can have patrons in Brazil paying in US dollars, processed through Patreon seamlessly.

Discord

Discord grew through communities, not ads. The first users were gamers on Reddit and Twitch who were sick of TeamSpeak and Skype.

Streamers would set up Discord servers for their fans, and every viewer who joined brought their friends. The growth was entirely organic for years.

The bot ecosystem was the secret weapon. Discord made it trivially easy to build bots — automated programs that add functionality to servers.

Music bots, moderation bots, gaming bots, utility bots. Developers built tens of thousands of bots, each one making Discord servers more useful and sticky.

A server with good bots became a mini-app platform.

COVID and the "beyond gaming" shift were massive. When lockdowns hit, study groups, book clubs, art communities, crypto communities, and just friend groups all started using Discord.

By 2020, non-gaming usage overtook gaming usage. Discord quietly dropped the "for gamers" tagline and rebranded as a platform for communities of all kinds.

Patreon

Platform risk is the core vulnerability. Patreon is entirely dependent on creators choosing to use it.

If YouTube, Instagram, or TikTok build sufficiently good subscription tools (YouTube Memberships already exists, Instagram Subscriptions launched), creators might consolidate onto the platforms where their audiences already live. Why send fans to Patreon when they can subscribe directly on YouTube?

The moderation challenge is constant. Patreon hosts content across the entire creative spectrum — including adult content, political commentary, and controversial creators.

Payment processors (Stripe, PayPal) have their own content policies and have pressured Patreon to remove creators. Every moderation decision risks alienating a segment of the creator community.

Revenue concentration is a risk. A relatively small number of top creators generate a disproportionate share of Patreon's revenue.

If a handful of the biggest creators leave for a competing platform or build their own subscription tools, it would materially impact Patreon's business.

Discord

Monetization has been the eternal question. Discord has 200 million monthly active users but has never turned a profit.

Nitro subscriptions are growing but most users are happy on the free tier. Unlike Facebook or Twitter, Discord doesn't run ads — they've explicitly said ads in DMs or chat would destroy the product.

Finding ways to monetize without betraying user trust is the core challenge.

The Microsoft acquisition saga. In early 2021, Microsoft reportedly offered $12 billion to buy Discord.

Citron and the board walked away. The thinking was that Discord could grow into something worth much more independently.

Whether that was the right call depends on whether Discord can eventually figure out profitability — Microsoft would have solved that problem instantly with its distribution.

Content moderation at scale is brutal. With millions of servers and hundreds of millions of users, Discord has struggled with harmful content — extremist groups, CSAM, doxxing, and harassment.

They've invested heavily in trust and safety teams and automated detection, but the decentralized nature of servers makes moderation much harder than a centralized feed like Twitter or Facebook.

Patreon

Patreon Memberships — the core product allowing creators to offer tiered monthly subscriptions with exclusive content, early access, behind-the-scenes material, and community perks. Patreon Commerce — tools for selling digital downloads, merchandise, and one-time purchases directly to fans.

Patreon Community — Discord-style community features built natively into Patreon, including chat, posts, and polls for patron-only spaces. Patreon Video — native video hosting so creators can post exclusive content directly on Patreon instead of using unlisted YouTube links.

Patreon Free Membership — a free tier that lets fans follow creators and access some content, serving as a conversion funnel to paid tiers.

Discord

Discord's core is servers — community spaces organized into text and voice channels. Think of a server like a clubhouse with different rooms for different topics.

Voice Channels let you drop in and out of audio conversations like a walkie-talkie. Stage Channels are for live audio events with audiences.

Forum Channels organize discussions by topic. Discord also has direct messaging, group chats, video calls, screen sharing, and a growing app/bot ecosystem.

Activities let users play games and watch videos together inside Discord calls.

Patreon

Index Ventures led the Series A. Thrive Capital led the Series D that valued Patreon at $4 billion.

Tiger Global participated in growth rounds. Initialized Capital was an early backer.

DFJ Growth and Wellington Management invested in later rounds. Creators themselves, including YouTubers and podcasters, have been informal ambassadors and some have invested personally.

Discord

Benchmark, Accel Partners, Greylock Partners, Index Ventures, Greenoaks Capital, Dragoneer Investment Group, Spark Capital, Fidelity Investments