The Economics of OnlyFans
A perfect storm of a global pandemic, a bleak love life, and impending global recession caused one of my friends to consider making an OnlyFans account.
OnlyFans has become part of the zeitgeist recently.
The rise of e-girls and the prospects of making millions make it a fun thing to gawk at in a reality-tv kind of way. It has benefitted fabulously from the pandemic too. With everyone stuck at home all day, less of us have jobs and we all have less to entertain ourselves with. More existential boredom equals more “fans” and “creators” alike.
I was curious about this trending yet mysterious company, and wanted to find out more.
Despite dipping its toe in the mainstream, there wasn’t much about OnlyFans in the news. There are many interviews with OnlyFans creators, but I wanted some hard data.
To get it, I scraped the Onlyfans website and did some analysis. The results are presented below for your pleasure. At the very bottom, I explain how I got them.
To start I go through OnlyFans as a business, explaining why I think it is a unicorn in disguise. Next, we’ll look at how OnlyFans is more unequal than the least equal country in the world. Finally, I’ll return to the question I began this essay with. Should you make an OnlyFans account?
OnlyFans is a billion dollar business
Sex has always sold well. Now OnlyFans use the leverage of software to multiply its profits, giving power to the performers along the way.
Their business is as simple as it gets. They provide a platform for paywalled content. Creators, mostly fitness models and amateur pornstars, post exclusive content, to which only their paying “fans” have access. OnlyFans takes a 20% cut, one giant pimp in the middle of an online marketplace of punters and showgirls.
It’s the Uber-isation of wanking; the logical conclusion to markets eating the world. Instead of monetising a spare room or a Prius you monetise your selfies.
While Uber and Airbnb disrupted taxi-companies and hotel chains, OnlyFans are disrupting a seedier incumbent — the porn industry. Big Porn is notorious for taking advantage of young women. Via their commission-based model, OnlyFans pays the performers their share, giving power back to the pornstars.
OnlyFans is actually an even better business model than Airbnb or Uber. As the owner of a rental property, or a gig taxi driver, I can only cater to one group of people at any one time. But as an OnlyFans creator, I can broadcast content to the multitude all at once. Making money on Airbnb or Uber is linear — I always have to do one more ride, or host one more visit. On OnlyFans it’s multiplicative — the same selfie can serve 10 adoring fans or 1000.
If you have minimal shame, a drooling audience and are willing to get your togs off its a pretty sweet deal: Creators can make millions of dollars a year just posting photos and videos.
Since they take a share of their revenues, what is good for creators is good for OnlyFans themselves. And by the looks of recent trends, business has been very good indeed.
OnlyFans have benefited massively from the coronavirus crisis. Search activity has doubled since the lockdown, and according to Alexa, their traffic has surged.
Source: Google Trends
Even before the pandemic they were growing rapidly. They paid £641k corporation tax in 2018, which at an effective tax rate of 15% implies 2018 revenues of around £4m, or $5.5m. Today in 2020, their top users alone make this much money through their site.
With a couple of assumptions, it’s easy to estimate their yearly revenue today. And oh god is it big.
In 2019, they had over 60,000 content creators and 7m registered users. Extrapolating from the Google growth trends, it’s safe to say they have at least 10m users today. I calculated the average revenue per creator per month (about $250) and the average subscription fee (about $8.7) from my scraped data. Applying the 20% commission and assuming only half the users and creators are active, we end up with a lower bound of $90m, and an upper bound of $104m.
That’s an annual growth rate of between 304% and 334%. Absolute nuts.
But how much are they worth? According to this article, OnlyFans takes home 60% of their revenue net of processing and fees. This means they make profits between $54m and $62m. Since the business really doesn’t have to do anything besides host the platform, collect fees, and store content securely, its probably worthy of an EBIT multiple of around 15x. This gives a total valuation of between $810m and $936m.
Who knew you could make so much money hosting nudes? The crazy thing is that this valuation is probably still too low. The estimate of the number of users is likely too conservative — The Economist has it at 12m. Also, it doesn’t take into account their recent surge in traffic, nor the likely sustained increase in traffic due to social distancing (See if you can work out why).
There are risks too. In any business that sells exclusivity, security is paramount. Apparently there was a big leak in February, but the company denies this.
Risks aside, OnlyFans is a stunningly good business. But for a company which claims to democratise paid content, its amazing how unequal it is.
Almost all money is made by the top creators
This is a histogram of the monthly revenue per OnlyFans account from the set that I scraped. Remind you of anything?
The revenue of content creators follows a classic power law distribution. The top accounts make something like $100,000 a month (these aren’t in my sample). The median account makes $180 a month.
The top 1% of accounts make 33% of all the money. The top 10% of accounts make 73% of all the money. This isn’t the 80:20 rule; it’s the 80:14 rule.
The standard way to measure inequality of an economy is with a Gini Index. An index of 0 implies a communist utopia, a value of 1 implies a single greedy capitalist owns all the wealth. The Gini index of OnlyFans is 0.83. The most unequal society in the world, South Africa, has a Gini index of 0.68. OnlyFans is less equal than an ex-apartheid state.
OnlyFans is so unequal because chancers make accounts with zero fans, while big Instagram stars take their following with them. A large proportion of accounts have no fans at all, and the lion’s share of fans are shared by the top accounts.
Most creators probably lose money
Being an independent explicit online content creator is by many accounts exhausting. Your “fans” are not merely fans, they’re paying customers. To keep that sweet money flowing into their bank accounts, content creators often have to work harder and harder to satisfy their patrons.
Most accounts take home less than $145 per month (after commission). The modal revenue is $0.00, and the next most common is $4.99.
Creators put hours into each post, and on top of that, they interact one-on-one, with fans who can message them at any time. To break even on an OnlyFans account, creators need to earn more per month than the cost of hours spent engaging. The median take-home revenue is $136 per month. If you value a creator’s time at a $15 minimum wage, the median creator needs to be spending less than 9 hours per month on her OnlyFans to break even. This is less than 20 minutes a day.
Fans expect regular, prompt engagement, and many creators compare OnlyFans to running a business. It seems unlikely that you could satisfy all your fans demands in less time than it takes to make and eat breakfast.
Relative to effort, it looks like most accounts lose money.
For this reason, unless you already have a large following from somewhere like Instagram or Twitch, making an OnlyFans is unlikely to be worth the effort.
I’d invest my money in OnlyFans, but not my time. Sorry would-be fans, you’ll have to get your kicks elsewhere.
Addendum: Getting the tip
One important thing this analysis of public data misses is tipping. A substantial proportion of the top accounts’ revenue comes from tips — money which fans send directly to creators for private messages or photos. Unfortunately, tipping amounts aren’t published by onlyfans so there’s a lot I don’t know about it.
I do know it can be very lucrative — some accounts request minimum hundreds of dollars per tip. Unlike posting public photos though, tipping doesn’t scale — you have to make every individual fan feel special. If you’re a large account and can charge hundreds per tip its easy money, but if you’re just starting out, tips make it harder, not easier, to attain a sustainable income because they require more work.
How I did it
First I emailed them to ask if I could see their aggregate level data. They sent me this reply.
Thanks Vlad. So I tried scraping their site instead.
I quickly learned that scraping OnlyFans is very difficult. This is not surprising — security is central to their business model. If you could scrape the images or videos off their platform, they wouldn’t have a business. I tried using Selenium and Beautiful Soup but neither one worked for me. So I used Sikuli instead.
Sikuli is a graphical user interface automation tool. It allows you to write scripts that mimic the behaviour of a real person — the computer physically moves the mouse to click on things, and types letters one by one into the search bar, just like you would. This means your script can “trick” websites into thinking you’re a real person, so they won’t block you. A disadvantage of Sikuli is it requires your entire machine to function. Like an AI villain in a sci-fi movie, the computer literally takes control of your keyboard and mouse, so you can’t do anything while its running. It also takes much longer than a conventional web scraper.
I processed the files using Beautiful Soup. I grabbed the number of likes, photos, videos, audios, the subscription price, and the last time the account was online. Most accounts didn’t have their number of fans publicly available, but if they did I grabbed that too.
I saved them down in a pandas data frame so I could easily analyse and visualise the data.
Because many accounts don’t have their number of fans available, I had to estimate it. I calculated the number of likes per post, and chose to use that as a proxy for number of fans. This is likely an underestimate; Jem Wolfe has over 12,000 fans, but this number isn’t publicly available on her page. In contrast, she only has 6920 likes per post. You can multiply the number of fans by the subscription price to get monthly revenue. Many accounts didn’t have one subscription price but several, depending on promotions or length of time subscribed. I set the subscription price for all of these accounts to the minimum, $4.99.
If interested, you can find the code I used here.
Thanks to Nat Fried for helping get the data, Katie Hollands for reading an early draft and Flora Zamula for mentioning the importance of tips.