I’m getting plenty of mail from my Gumroad post. This missive, in particular, asked a very good question, so I thought I would post it (redacted for privacy) and my answer.
Thank you for writing the article on The Gumroad Blog – “A patronage model with Gumroad.” (Link)
I’m a musician with a Patreon, and along with you I’m angry about the unannounced fee structure change they made – they lost my trust.
Your article explains with great detail how Gumroad can be a great Patreon alternative. Thank you for peeling back the curtain and showing us how you’ve set things up!
One question I have is not about Gumroad per se, but the PayPal subscriptions. When you have a $1 subscription, are you paying the 2.9% + .30 fee, leaving you with $0.66? I ask because the vast majority of my Patrons are $1 pledgers. Pinching pennies, yes, but it adds up!
If you could take the the time to answer this I’d appreciate it! I plan to follow your lead and give Gumroad a try!
Here’s my reply:
I believe I do pay the 2.9% and $.30 fee on dollar PayPal donation subscriptions. I don’t care about this as much as I do about Patreon’s fees, for two reasons: one, PayPal has always been up-front about said fees, and two, PayPal doesn’t add a second fee to the patron/customer the way Patreon was planning to do. I bear the cost, which I believe is only natural and proper. I offer the PayPal $1 subscriptions along with $3 and $5, and since PayPal lets them set up recurring monthly payments or choose to make a lump-sum donation, it’s super convenient for patrons in a way Patreon never has been.
Gumroad has a $.99 minimum, which may be a little more cost effective if you have enough subscribers to carry the monthly $10 premium fee; if you don’t, the free Gumroad option will take a similar chunk of the payment from you but still not charge the customer/patron more. I do have occasional Ko-Fi patrons, but I tend to steer new patrons who just want to show support with a couple bucks per month to PayPal, for their ease and for the consumer trust PayPal has built up. I seem to recall that at the time this all went down Ko-Fi didn’t have a recurring payments option but were looking at adding it in the near future.
I think if you already have a patron base, a mix of PayPal and Gumroad might serve the ones who want to move away from Patreon better—certainly that’s the route I chose, as you can tell! I know there are creators who have set up workflows to send perks to their PayPal patrons, but I chose not to, because I need my time for writing and Gumroad is way more flexible and time-saving when it comes to sending out perks. The limit to upload files for your Gumroad membership customers is 16gb, which is comfortable for musicians, I think. (Subscribers get updates through email, and I’m not sure what the file limits are there.)
So yes, PayPal does take a chunk of each dollar donation, but I’m fine bearing that cost because there’s more trust and they do NOT charge my patron for the transaction, which was the exact thing I was furious with Patreon for even considering. I do not advocate burning your Patreon to the ground—there are still several of my clients who prefer to stay with “the devil they know”, as is their right. As long as I have a single patron there, I’ll stay on the platform, but I’m open with them about why I think Gumroad’s a better option for both of us, and those who have made the switch seem to agree. If my patrons move on wholly to other platforms, I’ll feel just fine about deleting my Patreon, but as long as they want to use that service, I’ll keep content there for them.
I hope this helps. Thank you for your feedback!
I am extremely grateful for the outpouring of support from my darling Readers. If anything good has come of Patreon’s ham-fisted attempt, it’s that I’ve been shown in concrete ways just how much my beloved Readers care. (I mean, aside from buying my books, which is awesome in and of itself.) The internet has been a giant blessing and curse for creators, but most of the time the former overwhelms the latter for me.