The Future of Investing and the Creator Economy

Alessio Frateily

Hatched by Alessio Frateily

Sep 14, 2023

4 min read


The Future of Investing and the Creator Economy


In recent years, there have been significant shifts in both the investment landscape and the way creators operate in the digital economy. These changes have given rise to new opportunities and challenges for individuals seeking to build wealth and for creators looking to monetize their work. In this article, we will explore the concepts of long-term investing and decentralized autonomous organizations (DAOs) in the context of the creator economy. We will also discuss the emergence of non-fungible tokens (NFTs) and their potential impact on the ownership and distribution of digital media.

The Power of Long-Term Investing

One fundamental principle of successful investing is the concept of "just keep buying." This means that, unless for the purpose of rebalancing or retirement, investors should hold on to their assets and continue acquiring more over time. Selling investments prematurely can hinder future wealth accumulation. It is important to take a long-term perspective and resist the temptation to sell based on short-term market fluctuations.

When evaluating stocks, one commonly used metric is the price-to-earnings (P/E) ratio. This ratio measures the stock's price relative to its current earnings. Interestingly, there is a negative relationship between the P/E ratio and future real returns. As stocks become more expensive, the expected future return decreases. However, this negative relationship diminishes over longer holding periods, and positive real returns become more prevalent. Therefore, investors who hold stocks for extended periods of time are likely to see more positive returns.

The Rise of DAOs and NFTs in the Creator Economy

The creator economy has experienced significant growth in recent years, enabling individuals to monetize their creative work through platforms such as YouTube, TikTok, and Patreon. However, this growth has also brought about challenges such as creator burnout and a lack of necessary support and resources. DAOs and NFTs offer a new way to address these challenges and build a more sustainable and equitable creator economy.

DAOs, or decentralized autonomous organizations, present an alternative organizational structure that aligns incentives among various stakeholders. In a DAO, the relationship between creators and consumers evolves into a collaborative one, where everyone becomes a co-creator. Creative organizations within a DAO operate as flat peer-to-peer networks rather than hierarchies. This structure allows for greater participation and ownership among all participants.

In a DAO, the media company itself functions as a crowdfund of its creators, supporters, and community members. Through this model, all revenue generated from advertising, subscriptions, events, and other means is pooled into a publicly recorded treasury. This ensures a universal share in the ownership and distribution of wealth. Additionally, all digital assets created by the DAO are minted as NFTs, providing a means for participants to earn royalties based on the performance of the content. NFTs enable the ownership of digital media to become a liquid financial asset, secured through cryptography and programmable through smart contracts.

The Future of NFTs and Collective Ownership

As NFTs continue to gain popularity, creators will have two paths to choose from - independent or collective. By going independent, creators can fully benefit from the upside of their NFT creations and earn built-in royalties. However, the collective model offers a unique way to build distribution. NFTs can be programmable to allow royalties to be broken down into fractional shares. This means that a digital media file minted as an NFT can be owned collectively by a group of individuals, while still being accessible to all.

To fully capitalize on the potential of NFTs and DAOs, the foundation of the creator economy needs to be reimagined and rebuilt. This process is challenging, especially for businesses that have not been built with the criteria for the new era in mind. However, by embracing the principles of collective ownership and interdependence, creators, operators, and consumers can create a new media structure that benefits all parties involved. This structure allows for the development of multiple collectives, where creators and consumers can flow freely and invest in the growth and value of each collective.

Conclusion: Taking Action in the New Era

As we navigate the future of investing and the creator economy, it is important to take action based on the insights we have gained. Here are three actionable pieces of advice to consider:

  • 1. Embrace a long-term investing mindset: Resist the urge to sell your investments based on short-term market fluctuations. Instead, focus on acquiring assets over time and holding them for extended periods to maximize the potential for positive returns.
  • 2. Explore the potential of DAOs and NFTs: Educate yourself about decentralized autonomous organizations and non-fungible tokens. Consider how these concepts can empower creators and provide new opportunities for ownership and collaboration in the digital economy.
  • 3. Seek out collective ownership structures: Look for platforms and organizations that prioritize collective ownership and interdependence. By participating in these structures, you can contribute to the development of a more equitable and sustainable creator economy.

In conclusion, the future of investing and the creator economy is evolving rapidly. By understanding the power of long-term investing, embracing the potential of DAOs and NFTs, and actively participating in collective ownership structures, we can navigate this new era and build a brighter future for creators and investors alike.

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