Jan 11, 2021 · 1h 25m · how-i-built-this
Patreon: Jack Conte and Sam Yam
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In this episode of How I Built This, host Guy Raz speaks with Jack Conte and Sam Yam about how creator monetization frustrations led the Stanford roommates to launch Patreon, creating a sustainable subscription platform for independent artists worldwide.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Guy holds 29.6% of the talking time here. How this is scored →
Guy as informed peer 3.9 Guest teaching 3.3 Guest disagreement 1.5 Guy pushing back 1.7
speaking balance: gold is Guy, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 1:22:22 Jack rejects judging creator quality
Jack firmly rejects Guy's question about policing bad or mediocre content, stating that judging art quality would completely violate their fundamental principles.
Hardest push from Guy ▶ 1:12:28 Guy confronts Jack with platform income statisticsGuy directly presses Jack with critical reporting showing that nearly 80 percent of creators on Patreon earn less than federal minimum wage.
Biggest teaching moment ▶ 1:13:05 Jack reframes the purpose of Patreon versus discovery platformsJack educates Guy on platform mechanics, explaining that Patreon is strictly a monetization infrastructure for pre-existing audiences rather than a solution for supply, demand, or product-market fit.
Guy holds their own ▶ 56:55 Guy tests fundraising necessity against founder case studiesGuy draws upon extensive interview archives, citing Tristan Walker's regrets about venture capital to rigorously test whether Patreon genuinely required external institutional funding.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Guy as informed peer | Guest teaching | Guest disagreement | Guy pushing back | Why |
|---|---|---|---|---|---|---|
| Stanford Roommates: Physics Shifts and Dorm Burger Deliveries | 3 | 1 | 1 | 2 | Guy playfully challenges Sam on the logistical viability of delivering In-N-Out burgers to dorm rooms, noting burgers get soggy in transit. Sam amiably agrees, recounting the awkwardness of placing massive bulk orders. | |
| Post-Grad Paths: Early Startups and Bedroom Video Songs | 3 | 3 | 1 | 1 | Guy guides the narrative from post-grad startups to Jack's early video songs. Jack educates Guy on Dogme 95-inspired filmmaking rules and the concept of direct transparency in early YouTube videos. | |
| Pomplamoose Goes Viral: Covers, iTunes, and Tour Success | 4 | 4 | 1 | 1 | Guy highlights his personal familiarity with Pomplamoose from his NPR days. Jack details how treating YouTube as a search engine via unique song covers enabled rapid audience growth. | |
| Sam's Startup Hustle: AdMob Acquisition and Incubator Years | 4 | 3 | 1 | 2 | Guy clarifies the details of the AdMob acquisition and Google buyout. Sam explains the gritty reality of working alongside Instagram founders at Dogpatch Labs before their massive breakout. | |
| Streaming Squeeze and Kickstarter Discoveries | 4 | 4 | 1 | 1 | Guy points out how Spotify upended digital music sales and references his interview with Kickstarter's Perry Chen. Jack explains how the shift to streaming gutted artist unit economics despite growing audiences. | |
| The 'Pedals' Breaking Point: Big Spend, Tiny Ad Payouts | 3 | 4 | 2 | 1 | Guy reacts to the dark aesthetic and robot set of Jack's 'Pedals' video. Jack explains the painful mismatch between sinking $10,000 into high-effort production and earning negligible ad revenue on YouTube. | |
| Sketching Patreon and Pitching Sam in San Francisco | 3 | 3 | 2 | 1 | Guy probes into the initial partnership dynamics and splits. Sam and Jack humorously recall the naive NDA request and Sam's dismissive assertion that raw ideas are essentially worthless without execution. | |
| Launching with Three Creators and the Viral Adoption Loop | 3 | 3 | 1 | 1 | Guy asks how Patreon broke through after 40 creators rejected Jack's initial outreach. Jack illustrates the viral product cycle where creator pages served as public billboard proof-points for other creators. | |
| Seed Funding, Noe Valley Office, and Series A Growth | 5 | 2 | 1 | 2 | Guy challenges the necessity of raising venture capital by citing opposing viewpoints from past guests like Tristan Walker. Sam and Jack explain that server costs and customer support scaling made funding vital. | |
| Jack's Tough Decision: Transitioning to Full-Time CEO | 5 | 4 | 2 | 3 | Guy pushes into the content moderation crisis sparked by 8chan and high-profile departures like Sam Harris. Jack and Sam recount their intense internal debates and the grueling development of a comprehensive content policy. | |
| Handling Platform Criticism and the Payment Fee Backlash | 5 | 5 | 3 | 4 | Guy brings up heavy public criticism, citing reports that the vast majority of creators earn below minimum wage. Jack reframes the criticism by stating Patreon is a monetization tool for existing audiences, not an audience discovery engine. | |
| Tiered Business Model and the Pandemic Creator Surge | 4 | 3 | 1 | 1 | Guy asks about profitability and the pandemic surge as live events shut down. Jack acknowledges the strange dichotomy of company growth surging from the collapse of touring revenue. | |
| Reflections on Luck, Community Niche, and ASMR | 4 | 4 | 2 | 2 | Guy asks if the founders care about low-quality or mediocre content on the platform. Jack and Sam firmly reject the premise, explaining that gatekeeping quality contradicts the internet's ability to serve micro-niches. |
Statements from this episode (23)
Sam Yam built an In-N-Out delivery service at Stanford before DoorDash
“I created a website, I was driving burgers around and to campus. This is, that was my senior year in particular.”
Conte: YouTube drives creator discovery via search traffic for familiar songs
“That's kind of when I learned that YouTube is a search engine, and so people are searching for songs that they know. And if they then see a cool band who is singing that song, but maybe in a completely different way, with a completely different sound, and they…”
Conte: Pomplamoose made $22,000 in one month from 30,000 iTunes downloads
“We released a record, and, you know, at the end of the month, we logged into our bank account, and, like, we had sold 30,000 songs, and because we hadn't signed with a label, we owned all our own masters, and therefore we owned all the royalties, so we logged …”
Sam Yam: AdMob Acquired Adworld One Month Before Google Acquired AdMob
“It was a company called AdMob, and then literally the month afterwards, we were acquired into Google.”
Pomplamoose Earned Around $400K in 2010 Peak Direct Digital Sales
“We did about 400,000 dollars in a year off of mp-three sales, basically. And it was, I think that that year in particular, I think, was 2010.”
Natalie Dawn Raised $104,000 on Kickstarter for Solo Album
“And that, she ended up raising a 104,000 dollars.”
Conte: Creator monetization economics failed to keep up with distribution technology
“The economics of that failed to evolve with the distribution technology. So like the distribution happened first, and the economic systems to support that didn't keep up. And so we were in this horrible phase where essentially artists are working for free.”
Conte: Patreon co-founders agreed to a 50-50 equity split
“Yeah, it's in this email. We agree to become fifty-fifty partners in Patreon.”
Conte: All 40 creators rejected Patreon's initial launch invitation
“We made an Excel spreadsheet with those folks, and I found their contact info, and reached out to all 40 of them, and all 40 of them said no.”
Patreon launched securely storing credit cards but without actual payment processing logic
“We couldn't, for example we couldn't process all the payments at that time yet. I hadn't hooked any of that up. We could accept your credit card. And so that would get saved, you know, very securely by the way, because we were working at Stripe, but we hadn't …”
Jack Conte earned over $100K annualized within two months of Patreon's launch
“Within the first couple weeks, I passed 5000 dollars a month. And then soon after that, it was, yeah, it was even more. And at the time, I was making maybe two videos a month. So, you know, suddenly, like very suddenly, within two months, I went from draining …”
Conte: Patreon's growth was primarily driven by a creator viral cycle
“Some of the people who watched my video were creators themselves, and when they landed on my Patreon page, and they saw this random middle-of-the-road YouTuber making six figures, they had that same mind-blow moment that I had had two years before when Lauren …”
Conte: Patreon raised $2.1M seed round at $6M valuation
“That first round ended up being 2.1 million at a six million valuation, so it was, you know, about a third.”
Conte: Patreon raised $15M Series A round in 2014
“In 20, yeah, twenty-fourteen, we raised the fifteen million dollar round.”
Jack Conte: 8chan launched on Patreon to crowdfund the site's initial development
“The thing that caused the debate was a website called eight Chan that launched on Patreon.
Guy Raz: Yeah.
Jack Conte: And they were using Patreon to fund the development of the site.”
Conte: Patreon's first content policy took two months and totaled 40 pages
“He built these
Jack Conte: Very massive content policy and trust and safety and enforcement systems, and he worked with us for a period of two months to draft the first version of what became Patreon's content policy, which was, turned out to be about 40 page…”
Jack Conte: Online platforms absolutely can define pornography with rigorous explicit rules
“I've heard people say, you can't define porn, you just kind of know it when you see it. I beg to differ. You can define porn.”
Conte: Patreon refused to alter content policies to retain high-profile creators
“We weren't going to you know, we weren't going to change our minds to keep two or three creators as painful as that was.”
Jack Conte: Patreon does not work without an existing audience
“If you don't have an audience actually Patreon doesn't work so well for you at all, and so I think it's totally fair to, like, point that out, and I actually think it's important to be honest about that. Like, we want to be honest with that. If somebody expect…”
Conte: Patreon is not profitable and burning cash every month
“So no, Patreon's not profitable. It's tracking toward profitability. We're burning money every month, but actually the business is, like, very healthy.”
Conte: Patreon has over 200,000 creators getting paid on platform
“It's a little over 200,000, yeah, who are getting paid.”