Clubhouse needs creators, but creators need cash - The Verge

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Dozens of Clubhouse creators had been anticipating their first sponsorship meeting for months. As the inaugural class of Clubhouse’s “Creator First” program, they were supposed to receive Clubhouse’s help landing sponsorships and turning their shows into a “profitable creative endeavor.” The creators wrote down lists of brands they wanted to speak with and prepared one-sheets pitching their live audio shows. But when the time came, it turned out they weren’t getting one-on-one meetings with the brands; instead, they would be pitching their shows to a public room on Clubhouse, alongside dozens of other creators, where anyone on the app could join.

“It was a real big joke,” says Cyndi Pham, a creator from the program and a media consultant herself. “I feel like [making it public] was something they did to save face because they couldn’t get any sponsors to show up.”

The creators each had two minutes or so to pitch their programs to the sponsors in the crowd. “Dozens of agencies and brands attended,” according to a Clubhouse spokesperson. But technical difficulties tripped up multiple creators, preventing them from speaking. Clubhouse told the creators they’d hear more after the event and that interest was pouring in. But the contacts never surfaced.

“I received no email, so either that means nobody was interested in my show, nobody came, or I haven’t gotten the information,” says one creator who asked to remain anonymous because of their ongoing relationship with the Clubhouse team. “And I suspected the second one: that nobody came.”

Six creators from Clubhouse’s creator program say no brands sponsored them before the end of the program, and Clubhouse failed to turn any of their shows into sustainable endeavors, as it advertised it would. None of them plan to keep doing their high-production shows, and many are refocusing their efforts on other platforms, simply because they have a better shot at being compensated for their effort.

The creator program’s troubles suggest bigger potential issues for Clubhouse, which is reportedly valued at $4 billion. If Clubhouse can’t entice brands to put their cash behind its hand-selected, premium content, how will it keep creators on the platform?

“[Clubhouse has] a whole cohort of creators who mastered this craft, and now they’ve got to figure out how to make it a living,” says Owen Muir, a psychiatrist who hosted a mental health-focused show with his wife Carlene MacMillan for the program. “And Clubhouse is going to help us do it, or someone else will.”

It’s unclear how much money Clubhouse is making right now, despite its unicorn status. It has partnerships with some major organizations — like TED and the NFL — but the details of those deals aren’t public. And critically, Clubhouse isn’t directly monetizing the typical live audio rooms its users host.

Creators themselves also have no way to regularly monetize their shows like they do on other platforms. Right now, Clubhouse only offers tipping as a way for hosts to make money off their rooms, and the creators I spoke with say they rarely, if ever, received a tip. There’s no automatic insertion of ads, and sponsors seemingly don’t understand how the platform works even if they might be interested. One creator says they had to spend a significant amount of time educating potential guests and others about how the app functions.

Clubhouse said “a number” of the 25 Creator First shows landed sponsorships and gave three examples in a comment to The Verge. But of the three names Clubhouse provided, only one might have come through Clubhouse’s team itself. The others either resulted from the creator’s established relationships or through another Clubhouse creator who is unaffiliated with the program.

Even when sponsors did show interest, Clubhouse’s tools made it hard to support them. Pham, who arguably had one of the most successful shows from a monetization standpoint, had issues validating sponsorships, given that Clubhouse barely provided analytics. She says she and the other participants received the number of unique listeners, the total number of minutes spent listening, and the number of listeners a room had at its maximum.

“Obviously, if you know anything about sponsorships, that means nothing to anybody,” she says.

The creators point out they received no demographic information about their listeners, something brands need and want to see. In a comment to The Verge, Clubhouse says it doesn’t collect demographic data. There are also no in-app links within rooms or a way to designate that a room is sponsored, apart from saying so in the title.

“I think when [Clubhouse] first came out, it was so buzzy that there were brands willing to sign on because of the buzz,” MacMillan says. “It was a very cool place to be. I think now that it is a little bit more mainstream, they need more than that to sign on.”

Clubhouse gave creators a $15,000 stipend to cover the length of the program, although that was on a per-show basis, meaning co-hosts split the cash. Creators were also given new equipment, like iPhones, if needed; a producer to assist them; a creative agency partner to make visual assets; and the Clubhouse team’s direct line for advice or to vent. Everyone who spoke with The Verge said they were proud of the shows they made, despite likely not being able to continue them because they need to focus on supporting themselves.

Some of Clubhouse’s other advertised perks never surfaced. The team said it would help them book high-profile guests, for instance, but Clubhouse only named three connections made when reached for comment. Creators were also told they’d receive promotion both within and outside the app — another thing that barely occurred.

“We had to beg for tweets [about our shows],” says another participant who asked to remain anonymous because they fear retaliation from the Clubhouse team.

The company’s biggest promotional tool was the Clubhouse staff itself, these creators say. If a staff member entered a room, that meant more people would see it in their hallway, or the app’s main landing page. Stephanie Simon, Clubhouse’s head of community and content, for example, has over 3 million followers, so when she joins a room, all of them should see it prominently on the app’s homescreen.

“They will use their staff to drive traffic,” MacMillan says. “That seemed to be the major mechanism, which is helpful, but you have to rely on that.”

In a statement to The Verge, a Clubhouse spokesperson said: “At Clubhouse we move quickly, build in public, talk with the community, and ship improvements each week based on what they tell us. We think that’s a more human approach, more transparent, and if we are going to make social audio better, we need to be committed to listening about what works and what needs work. The inaugural Creator First program has proven invaluable for feedback and will help us refine this program and design better features for the entire Clubhouse community.”

The creators I spoke with say they plan to continue using Clubhouse in some capacity — they all love the community on the app — but they’re sketching out a new strategy: how they can keep making content and get paid for doing it, which likely means less time or effort going into Clubhouse. For many, making their Creator First show took hours every week, whether it was prepping in the form of reading up on guests, scoring episodes with music, planning detailed run-of-shows, or emailing people trying to find someone to guest. Now that the stipend is over, they have to use that time to make money.

Roderick Martin, for example, hosted a show about UFOs for the Creator First program. He’s found some success from YouTube — a TV show crew discovered him there and made him a host of a new program on Discovery Plus — and he also hosts a podcast. He says that if he now had a high-profile guest secured, particularly a guest that wants to be compensated for their time, he wouldn’t bring them to Clubhouse. He’d just lose money. Plus, the live Clubhouse show exists for only that period; there’s not yet a native recording function or archive that he could monetize.

“I would have to make that ultimate decision and do a video-type podcast to where it can be placed on YouTube so that the monetization of YouTube over time — because this is going to live forever — can begin to make that asset generate revenue,” he says.

Another creator says they’re also weighing what to do with their time.

“We’re better off turning this into a podcast, instead of doing it on Clubhouse, that then we could distribute, market, get sponsors‚ and it’s evergreen — it doesn’t disappear, people can find it — that might be a better use of our time,” they say.

Meanwhile, nearly every social app has dedicated millions of dollars to bringing creators to their platform. Facebook announced plans to spend $1 billion over the next year and a half to do so; Snapchat was giving away $1 million per day for months; and YouTube also announced a $100 million fund to encourage people to use its TikTok competitor. Even LinkedIn is dedicating millions to creators with the goal to specifically try out live social audio. Traditional podcasting apps are also offering subscription products that will help creators stay in touch with their listeners — Spotify and Patreon both give podcasters their listeners’ emails, something Clubhouse users don’t receive. Clubhouse isn’t giving up, either. It’s announced plans to continue the Creator First program in both India and Brazil.

Clubhouse and its competitors are pulling from the same playbook. But the key difference between YouTube and Clubhouse is that its platform already generates revenue for lots of people. If Clubhouse wants more creators to join and make high-quality content, it’ll need to get sponsors on board.

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