Like its peers in tech and advertising, startups in the creator industry have had to adapt to changing economic forces, leading to rounds of layoffs, fire sales, and a slowdown in investments. Unicorn startups like Jellysmack have contracted. Others, like BEN Labs, have had to restructure.
But firms like Goldman Sachs are still betting the category will grow into a meaningful part of the marketing industry in just a few years. And things are beginning to look up again for creator startups.
While venture-capital investments in creator upstarts waned for much of 2023, they are rebounding, particularly in the US, The Information reported earlier this year. Startups are raising seed and later-stage rounds from VCs, albeit at smaller scales.
For instance, PunchUp, a comedy startup that helps comedians sell tickets and market live events, closed a $1 million round in November. Other companies, including Beehiiv, WorkWeek, Storiaverse, and ShopMy, have also raised millions of dollars in the past year.
Investors like Daybreak Ventures’ Rex Woodbury are keeping tabs on innovative shopping applications that bridge commerce and content — a category that has been an ongoing testing ground since the rise of the creator economy. Woodbury is excited by “discovery-driven shopping” tools like Flagship, a digital storefront startup.
“Hype is always something to be wary of in venture,” Woodbury told Business Insider. “This is really an industry about being contrarian. When something is out of favor, that’s almost more attractive, right? Because then you can find companies that are under the radar or founders who are exceptional, but maybe not being priced up the wazoo.”
Artificial intelligence remains a focus of many investors in 2024, too. It touches the creator economy as startups develop ways to augment and potentially replace humans in accomplishing some creative tasks. For instance, A* Capital has invested in AI tools for creators over the past year, including EyeTell, founded by YouTube cofounder Chad Hurley.
Creators and creator-founded brands, like Chamberlain Coffee and MrBeast’s Feastables, are also raising capital from VCs. Chamberlain Coffee announced a $7 million round last June featuring investors like Volition Capital, Blazar Capital, and the investment arm of United Talent Agency.
“The big question is … how do you break through the noise?” said Inspired Capital’s Kamran Ali, who led ShopMy’s latest round. He added that Inspired talks closely with brands and creators to hear what products and startups are exciting, which helps guide the firm’s investments.
Business Insider is highlighting 11 VC firms and their partners who are focused on finding the next wave of promising creator-economy startups. This list, our fifth annual, was compiled by BI based on our reporting and the nominations that we received. We looked at each firm’s investments in the past year to understand how they funded new ideas in the creator industry.
Each venture capital firm is listed below, in alphabetical order:
