If you follow Tim Ferriss like I do or you’re interested in crowdfunding and business models online you might be interested to see what just happened with Tim Ferriss on the Tim Ferriss Show, which is his podcast.
I’ve been listening to it for a few years, it has amazing guests on it like Arnold Schwarzenegger, Amanda Palmer, Brene Brown and lots of others. Tim Ferriss this year in June 2019 just tried a bold experiment with him. He started offering crowdfunding but through supporting his show directly instead of taking advertisers. He started, as you can see on tim.blog/support it says from June to December 2009 I’m removing ads and sponsors from the podcast for a planned six month test. He said if the response is mostly crickets it could end sooner as this is an expensive roll of the dice. The Tim Ferriss podcast is currently monetized by advertising revenue where sponsors pay to have their ads before and at other points, potentially in his podcast episode. What he offered on tim.blog/support was the option to pay monthly just on a voluntary basis. Then you get private question-and-answer videos live with Tim when you pledge to do this along with other rewards. I signed up for this and went to Tim’s first live question-and-answer session.
Right after that Tim then sent this message in July at 2019, thus just less than barely a month after this experiment started, he sent this email out saying why I’m stopping the fans supporting the podcast experiment.He says he’ll be stopping and that is what he’s stuck with since this message. He sent this email saying I’ll be stopping the fan support podcast experiment and moving back to ad support.
He notes that people were saying that they wanted ads back in the podcast and that they found the ads valuable. What I saw as a supporter and a viewer and a listener is that people were also saying the opposite, that people did like it with no ads, did like the supporter model.
It seems that Tim chose to take action on the comments saying that the people, for example, this one “I don’t mind hearing your sponsored advertisements”. I consistently skip past Tim’s sponsored advertisements myself, I’m not interested in hearing those and I much prefer the idea of a direct sponsored podcast to the alternatives. What I can gather is that even though Tim Ferris had thousands of people that were jumping in and supporting the podcast immediately, the amount of income he was getting monthly from having thousands of people who pledged $10 or so a month was a fraction of what he was used to. Based on that there were hundreds of people in his first live stream and at least 500 questions I’m going to guess, probably conservatively, he had at least 2,000 people within the first month pledged at least $10 a month, maybe even up the average to say $20 a month given there were higher priced options, up to $1,000 a month. I’m guessing, maybe more aggressively, that there were at least 5,000 or maybe more accurately, there are probably about 5,000 people that signed up. That means that’s about $50,000, I’m guessing, maybe around $50,000 a month within a month of launching that Tim was getting directly from the podcast.
The problem with that is for Tim $50,000 compared to his ad revenue on a podcast with 400 million downloads was probably really teeny-tiny, thus he immediately canceled the experiment seeing that his income, I’m guessing, was probably looking to get cut but drastically maybe 80% or more over the ads. I imagine Tim’s getting at least $20 cpm on ad revenue, maybe $50 or a hundred, even depending on the negotiations. You’ve got Tim getting probably a hundred plus thousand listens in the episode, maybe even a million listens in the episode, then Tim’s looking at getting a lot less money, making hundreds of thousands a month on his podcast ad-supported versus maybe $20,000 a month with direct crowd mode.
This is good guidance for those of us who like the idea of funding, this is a good lesson that a lot of people just aren’t ready to transition into something like a crowdfunded podcast, as you can see with the comments on Tim’s, who’s been providing a lot of value for years for free on his podcast, lots of people just not interested or willing to contribute.
Here’s a very interesting poll Tim had on here as well. He went against this poll, doing the experiment which I salute as bold and courageous. Tim went against the information on this poll and I believe Tim put the minimum at 10 dollars or more a month. I imagine that the actual contributions were significantly less per listener than in this poll. Given my estimation that there were probably somewhere between two thousand and ten thousand people who signed up within the first month or so along with me. You can see the majority of people saying they wouldn’t donate and then the next majority saying they would give five dollars a month and then only four percent saying ten dollars or more a month.
This is a good lesson if you’re looking to especially use Patreon or any other model that this currently is not a business model that most people are at the level for or interested in participating in. For Tim Ferriss, who has such a huge following with his podcast and so many listeners, for this to fail for him is a grateful lesson for all of us.
I’ve tried to do a bunch of Patreon and the only way I could get people to pledge was to give them a direct some kind of a business service in exchange for pledging and thus that can work. Tim what was giving a live question and answer, which I thought was really valuable, I guess other people didn’t jump right in on it within the first month.
If you’re thinking about going with some kind of crowdfunding, keep this experiment in mind, which is what Tim Ferriss podcast did at a big level. If you put that down to a smaller level with someone just getting started, you’re likely to have anyone at all contribute. Even where I’m at, when I do something for crowdfunding, I’m lucky to have a few people sign up within the first month. For example, I just did a Kickstarter and off of all the promotion I did and talked about it in the first couple days two of my friends signed up and not one other person put in. There was technically one spammy thing but not one other real person put in money out of thousands of people who were aware of it, thus, crowdfunding does have its place however, it has to be done in a very certain way.
I’m very grateful Tim did this big experiment for us and he even gave double the refund of whatever you put in, he fully refunded every Tim Ferris podcast subscription thus he gave me my money back, I pledged I think $39.99 a month. I was thinking of pledging a thousand a month and I pledged $39.99 a month after my wife told me that charity begins at home so I gave her the thousand dollars instead. Tim Ferriss sent us, all of us who have supported him, he sent us Amazon gift cards in addition to the refund for the exact amount that we pledged. I gave $39.99 to Tim, he refunded it and gave me $39.99 back The selfish part of me says Man don’t you wish you’d put the thousand in now you could have got that refunded and gotten a thousand dollar Amazon gift card as well.
Wow, I appreciate you taking a look at this, this is an interesting story. If you’d like me to do some more stories like this please let me know in the comments here, things that involve other people and what is going on out there in the world that I’m paying attention to. I appreciate the chance to serve you today. if you haven’t already, I trust you’ll hit that subscribe button if you want some more amazing videos like this or you’ll follow me on Facebook. If you want to contact me and you’re interested in collaborating, go to jerrybanfield.com/contact. I’ve got my contact information up in the best format I’ve ever had so far.
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