Creators are the future - so let’s put payment delays in the past

The numbers don’t lie. The creator economy, currently valued at around $250bn (£185bn), is expected to nearly double to $480bn (£355bn) by 2027. That adds up to remarkable growth, by any metric.

But even as the sector they have built booms around them, creators are struggling to get the money they are owed - just the latest victims of cash flow friction in the digital supply chain.

As new platforms and solutions enter the adtech process, the supply chain continually extends, bringing new payment delays and fresh bottlenecks as money meanders slowly along an ever-longer chain. 

Given that they already face payment terms that regularly hit 120 days, creators and other adtech partners are often starving for cash by the time they get paid - money they could have been using in the meantime to settle bills, create content and fund growth and innovation.

A high-tech business - powered by frustrated human beings 

Most of those along the digital supply chain are struggling with similar problems. The agencies who commission creators often struggle to settle up within a reasonable timeframe, frequently adding terms and conditions into contracts to protect themselves.

Typically, agencies and brands pay creators 60 to 90 days after work is delivered, but according to recent research, 56% of creators face late payments, while 74% have stopped working with a brand after feeling undervalued for their work. In a human-driven business that depends on happy, satisfied creators, this represents a genuine problem.

It is easy, perhaps, to shrug off a small supplier’s calls for faster payment. But the satisfaction and fair remuneration of creators ought to be a source of concern for all those who benefit from the campaigns they create - from creator agencies to partnership platforms to the brands themselves.

Creator agencies that stake their reputation on delivering successful campaigns and maintaining strong creator relationships need to attract top influencer talent. Fast, smooth payments to creators represent a competitive advantage, and slow or unpredictable ones undermine their reputation. But as it stands, many agencies face a lengthy wait for payments from their own clients, and creator payments slip as a result.

Brands that commission creators in-house have slightly different concerns, but they still need their influencers to be motivated, create high-quality content and uphold brand values. They too have valuable reputations to maintain - no brand wants its former collaborators broadcasting negativity across the internet. However, they also often have rigid internal payment processes and slow accounting cycles that mean they are often slow in paying creators.

Partnership platforms, meanwhile, risk unwelcome churn if creators and agencies are dissatisfied by financial friction. Seamless payments increase partner satisfaction and reduce drop-off - so much so that, having traditionally sold themselves on their discovery, performance and analytics capabilities, platforms are increasingly aiming to differentiate themselves in the marketplace by offering fast payment terms.

Keeping valuable collaborators on side

So what is the solution to an endemic, industry-wide problem? Here’s one: businesses that want to address their own payment problem can work with fintech partners who understand their business and can provide instant access to advances against revenues - unlocking cash to streamline and safeguard their creator investment.

For agencies, fintech partners can easily plug into their systems, establish eligibility, and provide the funds to ensure partners are paid quickly. Creators remain happy and loyal, and agencies establish a reputation-enhancing differentiator in the market.

For large and small brands commissioning creators through in-house teams, this funding model allows them to pay partners instantly without changing legacy internal processes. For partnership management platforms, the ability to make faster creator payments limits churn and increases retention of both creators and satisfied brands.

Fresh finance against revenues allows companies to offer influencers instant payment without straining their own cash flow. And by paying creators faster, brands and their partners keep these fast-growing, highly creative collaborators on their side. 

Finger-pointing doesn’t improve cash flow

This isn’t a simple case of starving heroes and late-paying villains. For businesses operating in the adtech space, the ability to pay partners on time is part of a broader discussion around cash flow within the industry. 

Seeking financial support through fintech companies that specialise in adtech can mitigate cash flow issues caused by financial friction in the supply chain. It allows businesses to plan for the future and focus on growth and effectiveness, rather than jeopardising their creator investments with persistent late payment problems.

The opportunity exists to make payment delays a thing of the past - increasing loyalty and relationships between media partners, and enabling better and more lucrative campaigns. 

The future of adtech is exciting and creator-centric, but it is also uncertain. Working with funding platforms to ease financial stress can help agencies, brands and platforms focus on growth and creativity, while enabling creators to do the same.