The difficulties creators face in creating sustainable businesses and owning their fans’ data motivated Mike to start Subtext. A few years after it first launched, Subtext has become a powerful platform that empowers fans and creators.

Find out how Subtext started and its impact in the creator space today.  

Tell us about your background and how you came to co-found Subtext. 

Mike Donoghue previously ran a tech and media incubator for a larger company and is now the co-founder and CEO of Subtext, a platform that connects creators with their audiences via text. 

The founding story of Subtext was interesting. They were looking at creators, artists, athletes, and musicians and saw the number of resources that went into building huge audiences on traditional social media channels. These individuals realized they were renting relationships with their fans as opposed to owning a direct, meaningful line of communication with them. 

And as algorithms and monetization policies changed, creating a sustainable business was increasingly difficult for creators. “You’re building that business on someone else’s land,” Mike adds.

After seeing this challenge, Mike and his team knew that they wanted to create something to empower fans to have a more direct connection with the creators they love and empower creators to create sustainable businesses while owning underlying data associated with the huge fan bases they’ve built.

Fast forward to 2022, and Subtext has sent over 5 billion text messages and worked with thousands of creators. 

Can you tell us more about Subtext? Its features, who is it for? 

Subtext is straightforward to use. Individual creators have several options on the platform. They can make their campaign or text line and make it free to the public or charge a subscription fee. 

For instance, creators may charge $5 to $10 monthly for fans to be part of their private communities. These communities serve as an avenue for creators to talk to their fans behind the scenes and do live Q and A sessions. 

Other creators are more focused on building up big audiences on Subtext to keep people up to date about new videos being released, new merch drops, or live events they might be participating in. 

“It’s really simple. We like to say, ‘If you can send an email, send a tweet, or post something on Instagram, you can use the platform,'” Mike explains. Using Subtext is a no-brainer, but it’s also very powerful. ICYDK, the open rate of text messaging is 98%. Not to mention Subtext gives fans the ability to text back one-on-one with their favorite creator. 

On the creator’s side, they’re able to get back to their fans who may have questions or want to follow up. This participatory experience is just one of the reasons why everyone loves using text. Plus, it’s a very direct way of communication, which takes engagement to a whole new level.

What was the original vision for Subtext, and how has that vision evolved?

The original version of Subtext was built with the goal of creating meaningful lines of communication between fans and creators. Mike and his team wanted to help creators build sustainable businesses on the platform and remove the toxicity that exists in most traditional social media channels.

Subtext is a private, one-on-one channel, which is healthier for creators. If a creator posts something, they won’t get thousands of comments from people hating them or their content. In traditional social media, creating a fake or burner account and being cruel toward a creator is easy. This situation is inexistent in Subtext.

Ever since Subtext was developed, the evolution has been amazing. They have millions of subscribers on the platforms, and creators earn around $500,000 annually. Most importantly, the platform is easy, as creators don’t have to go out of their way to produce a video and post it to different platforms. 

How does Subtext support the 99% of creators who might not see the benefits from large social media platforms’ investments?

When Mike’s team set out to build Subtext, they looked at the totality of the creator economy. “Of course, you’ve got sort of 1% of the creators out there that have a lot of gravity that soak up a lot of the ad dollar or viewership,” Mike states. 

He continues by saying that they built Subtext for everybody — even aspiring creators or creators who are at the meteor end of the bell curve in terms of followership. 

Can you share some successful case studies of creators using Subtext to foster their communities and generate income?

Subtext has also done a lot of work in the music industry. They have relationships with Sony Music, Universal Studios, Warner Brothers, and many other major players in the space. 

Maggie Rogers, an up-and-coming artist, reached out to Subtext, wanting to become more open to her fans. She wants to show them behind the scenes of her in the studio and on tour. She has a new album coming out and wanted to create an immersive experience for her fans but using non-traditional strategies. 

Subtext set her up and gave her the ability not only to text her fans but enabled her fans to call her through a phone number. It was like a traditional phone tree where fans could press a specific number and hear her single. The different number was assigned to different singles. Fans could also leave voicemails for Maggie, too. 

The voicemails asked fans what they thought about Maggie’s new single or the first show they saw Maggie. Maggie would play and react to those voicemails live on TikTok and other social media platforms. The entire experience was meaningful, as her fans loved it. 

In your article “Creators are seeking alternatives as big platforms vie for talent,” you mention that social platforms focus their support on a tiny fraction of creators to maximize user retention and viewership. How is Subtext addressing this issue?

One of the trends Mike has seen in the space today is the push to own a line of communication with a fan base. Given the changes taking place — TikTok being banned in some states in the US and platforms introducing new formats and rev shares and then pulling those back — the space has become incredibility trick and scary for creators. 

Mike believes traditional social media platforms will always exist, and no creator will leave YouTube or Meta to solely focus on Subtext. But nowadays, more and more creators are rethinking their approaches to these platforms. 

Creators have a huge audience and the opportunity to put out content visible to millions of people worldwide. The question is: what will they do with that audience? What’s the endgame? 

“What we see to a large degree is creators using their traditional social audiences to funnel them back to an experience where they can own that communication, data, build subscription revenues, and communicate with fans in a more direct way,” Mike adds.

Traditionally, social media platforms where monetization stopped and started with more uneasiness. These platforms are large and aren’t built for high-quality interaction or community building — they’re purely for the quantity of scale because they make money serving ads. More ads mean more data these platforms can collect but don’t share with the creators.

Social media platforms need creators to some degree, but they’re not focused on quality of interaction or creators making a sustainable living. They just do the bare minimum, which is to keep creators on the platform because they’re essential to their business model. 

But at the end of the day, these platforms don’t give or commiserate amounts of money back to creators. Even 1% of creators who drive huge audiences aren’t paid enough. 

Considering the trend of large platforms entering bidding wars to retain top creators, what strategies does Subtext employ to attract and retain these creators?

Large platforms entering a bidding war to retain top creators will continue to play out in the future. But Subtext’s value proposition is simple — they’re not going to require exclusivity or ask creators to put out content set in a specific format. 

Subtext will continue to serve its purpose, which is to facilitate communities, empower creators, and allow them to build meaningful businesses on the platform. 

How does Subtext help creators transition from focusing on social virality to prioritizing community building?

Subtext sent billions of texts last year and gained a lot of learnings ever since they started. Mike takes pride in having a great team that’s focused on the success of the creators on the platform. 

According to Mike, their secret to helping creators transition is basic marketing. They assess the unique value proposition to sign up, think about how they will price their services to attract subscribers and decide how they will lead individual creators into the communities they’ve built. 

In short, what Subtext is doing is making people feel welcome and more engaged. They’re also looking for ways to leverage the existing community to grow through word-of-mouth, traditional social platforms, or other methods. 

Subtext’s processes are pretty straightforward. They employ different for people to sign up fast and easily. For instance, they can text a keyword to a campaign phone number and get signed up after a couple of seconds. 

What makes Subtext different from other platforms that also focus on creator empowerment?

Many platforms suggest they’re empowering creators but are building data businesses out of the creators’ fan data. When creators decide to switch platforms, they won’t be able to own or take any of this data with them. The data they’ve gained from their fans isn’t portable and stays with the platform they previously used.

One of the main differentiators of Subtext is that they give ownership to creators over their data. “When a creator comes on board, we can look them in the eyes and say, ‘You own this; this is your business. This is your audience. You can take it with you,'” Mike says. 

When creators win in Subtext, the people behind the platform also win. Mike takes pride in saying that they don’t have any ulterior motives, unlike most data companies. 

As you’ve stated, many creators are dissatisfied with the low payouts from social platforms. How does Subtext ensure fair compensation for creators?

Subtext always pays 80% of any subscription revenue to creators. The platform also handles all the payment processing and everything else that comes along with it. 

Subtext doesn’t levy any sort of requirements on creators in terms of funds. They won’t require creators to post a particular type of content or do a co-branded promotion on social media in order to be part of the program. 

Instead, they’ll encourage creators to focus on doing what they like to do, and they’re there to help in terms of pricing subscriptions and understanding what their audiences will and can pay. They’ll basically handle the heavy lifting from a technical standpoint, and creators can engage with their communities, create a fun experience, and walk away with the data they’ve acquired using a direct line of communication. 

In the article, you mentioned the $2 billion of new venture funding poured into the creator economy in 2021. Can you comment on Subtext’s funding and growth plans?

Subtext has focused on the core businesses and never had to raise money externally. Because of this, Mike and his team don’t receive a lot of outside venture funding, which he considers as good because it’s easy to lose the vision for the product when there are too many new voices in the room. 

The absence of outside venture funding allows Subtext to focus solely on empowering creators and building their businesses instead of changing their vision quickly as trends happen. This will be their focus in the coming years, not chase trends that might not stay in power or not have the best interest of the creators and their fans. 

How do you see the creator economy evolving in the next five years, and what role do you envision for Subtext in that evolution?

Even with the rise of ChatGPT and other AI-powered tools, Mike believes that creators won’t be displaced. On the contrary, he sees AI as an excellent tool for creators to help them scale, particularly in instances where they don’t have enormous resources, like engineers and designers.

Creators continue to exist, thrive, and become successful long-term because of their voice, vision, and content. “And I don’t think any amount of generative AI, even the functionalities of ChatGPT, can change that,” Mike says. 

From Subtext’s perspective, they’re thinking of using AI as large language models, which can help them cater to more creators, especially creators who have very large audiences. AI can help Subtext get to the core of what those audiences really need fast. 

Do you see creators eventually moving away from larger social platforms? If so, how does Subtext plan to facilitate this transition?

“I don’t think they’ll move away from larger social media platforms. I think the utility of those larger social platforms will change,” Mike states. 

Mike cites Mr. Beast as an example. He may have a sponsorship deal with Pepsi and gets paid x amount of dollars to drink Pepsi on one of his platforms. But today, there is now the “Creator direct to consumer” movement, which involves taking a little bit of money from the brand and using the audience to drive awareness about that product. 

It might be a one-time payment for an endorsement, but somebody like Mr. Beast is now using that resource to be able to create his own business. He then drives awareness about these businesses using larger social media platforms. 

Mr. Beast builds equity in a business that he owns as opposed to building equity in somebody else’s business while also opening himself up to various brand deals that come along, like sponsorships. 

Creators will never leave TikTok or other major platforms, but there will be a shift in focus. Instead of looking at these major platforms as the creator’s sole audience and monetization outlets, they should leverage these platforms to refer their audiences back to experiences that they own as a creator. 

How can creators best leverage platforms like Subtext alongside their presence on traditional social media platforms?

Subtext welcomes all creators. Mike and his team even tell people to give Subtext a shot because it’s a low-risk investment and enables them to own something associated with their audiences. 

In addition, having the first thousand subscribers in Subtext enables creators to have another revenue month over month. They also get to communicate more directly with their biggest fans — the people that people care about creators the most. Most importantly, creators will have the opportunity to try out new content or new material in that community. 

What advice would you give to creators who are struggling to maintain their creativity while dealing with the business side of the creator economy?

Plenty of platforms and people will happily take 90% of a creator’s revenue and give creators 10% while they’re also building a tremendous amount of equity in their platforms. It’s easy to see who these people are and why they’re doing that. 

“So find people who are focused on empowerment and not people who are only focused on short-term gains,” Mike advises.