Mobile users who scroll through TikTok, Instagram…and now Clubhouse…are looking for entertainment.
But when Isaac Hayes III scrolls, he’s thinking about one thing: How can he help these content creators make money?
Hayes, son of singer-songwriter and producer Isaac Hayes, has experience both on the creative side and the brand management side of the industry as a songwriter-producer and as the manager for his late father’s estate.
Around 2018, he started noticing that while individuals were creating a lot of content, they were not being compensated financially.
“It reminded me of the music business around 2010 – 2012, where rappers were putting out free mixtapes…and they weren’t making any money,” Hayes told Hypepotamus. “Then streaming came along. Spotify blew up and Apple Music came along, and now these people are able to put their content on streaming sites and monetize their mixtapes.”
“Black culture contributes so much to social media platforms. We really help boost the valuation of these platforms,” added Hayes, though often Black content creators are not directly compensated for their contributions to the platform.
He also recognized another important part of social media culture: Younger generations have a very different relationship with online communities, and they want to be in digital spaces where they are surrounded by their peers.
“Centennials (Generation Zs) are very transactional, they’re giving, and they understand in-app purchases.”
That led to the launch of Atlanta-based Fanbase, a subscription-based social network focusing on monetization opportunities through authentic user engagement.
Content is served to a user’s entire audience, without having to compete against an ad-based algorithmic model that is seen on more legacy platforms like Facebook or Instagram.
The platform supports both short-form and long-form content, be it short films, recipe guides, or music. Creators can upload photos, videos, and live streams, and fans can subscribe to each individual creator’s channel for $3.99 a month.
Hayes told Hypepotamus that the app will soon be available for Android. Audio rooms and other chat features are set to roll out in the near future.
THE EQUITY CROWDFUNDING DECISION
Since late 2020, Fanbase has raised over $2.3 million, well over their initial target of $1 million.
This came from StartEngine, a platform where founders can turn to the general public for equity crowdfunding opportunities. Platforms like StartEngine help those who don’t qualify under traditional SEC angel investor regulations but still want to invest in up-and-coming startups.
To date, Fanbase has well over 4,000 investors from the site.
“Coming from the music industry, I always say that getting money from venture capitals is like signing to a record company. Typically they take a bigger piece of the pie…but doing equity crowdfunding is like going independent,” said Hayes.
For Hayes and Fanbase, starting with equity crowdfunding was yet another way to help grow Black wealth. “There’s room on the cap table for young creatives that say, would I rather make money from TikTok or own the next TikTok?”
The decision to use equity crowdfunding instead of a more traditional VC route also helped Hayes keep decision-making power while growing his team, which is currently 14 people strong.