| Image Credit: Techleap.nl
The creator economy can be described as one of the biggest influences of the internet of today’s modern age. Gen-Z has decentralised the media to such an extent that creators have become a go to source for news, entertainment, live events and even commerce.
A SignalFire report estimates 50 million consider themselves to be creators while 29 per cent of American kids aspire to be a YouTuber. This prolific rise of creators and influencers has not been without its share of grievances. Like traditional media companies, who have grown critical of social networks, creators have grown frustrated with some social networks as well.
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In late 2020, TikTok creators came together to criticise the company for its creators fund. Is it possible for creators to make a livelihood out of doing what they love to do? Dutch startup The Cirqle believes it’s possible, having paid over $25M dollars to creators while its ROI-driven influencers marketing platform could become the model for the future of driving commerce on behalf of brand partners.
Helping creators build a profitable business
The Cirqle is a creator commerce platform that unites brands and 500,000 creators. Steven Lammertink, a serial entrepreneur and founder of The Cirqle, says “enabling brands and creators to build a profitable business on social media, together” is their sole and singular mission. The company has over half a million influencers worldwide on its platform who are able to better monetise their following. Brand partners subsequently discover what creators are generating revenue for their business.
“We essentially give creators a platform to monetise their audience and to participate in brand partnerships that they were otherwise unable to attain,” Lammertink explains. “We equip creators with social insights on how to grow their accounts and in what areas they should invest while continuously sharing new collaborations with them. On the flipside, we equip brand-partners with deep insights into creators’ performance, from impressions to revenue and sales once a partnership has been established.”
The Cirqle works with brands looking for creators and uses their own proprietary software to connect them with each other on its platform. “The platform offers full visibility to clients on a creator’s reach including what percentage of their audience actually sees the content. More importantly, the technology maps out exactly what piece of creative is driving the sale and boosts that creative with paid spends through the social networks for maximum return” says Lammertink.
Lammertink holds a distinguished place in the world of the creator economy. His ability to see the creator economy become a massive industry should be likened to Mark Zuckerberg‘s ability to see social media bringing people from across continents onto a unified platform.
When asked about discontent among creators around revenue, Lammertink did not even take a second to answer. “What has happened in the market is that the creator’s organic reach has strongly declined by 80%” he says. “So, posts could go viral around 2 to 4 years ago. It’s now much harder. Our data indicates that a creator channel, on average, only reaches about 3 to 5 per cent – per post – of their follower base. The solution is to put paid spends behind the creative through The Cirqle’s platform.”
“Say you have a creator who has a hundred thousand followers, and that person shares an Instagram post, they typically reach around 3,000 followers. Clients end up paying for reaching an audience of a hundred thousand followers but in fact, that doesn’t happen, they only reach a fraction of them” he further explains the situation.
Lammertink says he wanted to solve this lack of transparency around actual reach from the start. The Cirqle offers transparency to both clients as well as creators about their follower count,organic reach and most importantly: ability to generate commerce. Don’t mistake the platform for helping the clients, though.
The Cirqle also helps creators open up their channel and creative to brands and run using the content produced by them. Creators own the space and the content and brands pay for this access while benefiting from increased awareness and ability to drive return on ad spend or RoAS. The platform also helps creators optimise their content for “driving as much sales and revenue as possible.”
Social Creator Commerce will overtake e-commerce
With The Cirqle, Lammertink’s team is not only building a platform that will make it easier for creators to monetise their content. He’s also built a platform that will drive the future of commerce. The evolution of commerce and our shopping experience is one where we have moved away from buying goods at a store to buying goods almost exclusively online.
The future attraction is one where we will shop directly from creators accounts, powered by the social media platforms. Instagram is already a major destination for social commerce and TikTok is quickly becoming an even bigger force in this space. An estimate says that social commerce is a $950B industry and Lammertink believes this industry is only getting started.
In comparison to social commerce, the creator market is only a $50B industry, which makes it much smaller than the entire landscape. With its creator economy platform, Lammertink says the creators are going after a “trillion dollar market.” This vision is what makes Lammertink one of the major proponents in the social commerce market.
Lammertink says there are about 7,000 influencer platforms but only a handful focus on enabling brands to drive creator commerce. He further explains that all the other platforms look at earned media value as a proxy for measuring success but “earned media value only speaks to your traditional marketing metrics, such as impressions and reach while our platform is built to only look at the amount of sales, revenue and conversions generated.”
Return on Investment (ROI) approach to influencer marketing
The Cirqle is not in the business of helping influencers or creators drive revenue for brands and themselves in the short term. It is looking at helping these creators establish themselves in a way that when social commerce becomes ubiquitous like e-commerce today, these influencers are uniquely positioned to reap the benefits.
The platform built by Lammertink and the team at Cirqle looks at ROI for every dollar invested by clients with its influencers. This question essentially keeps the Cirqle laser-focused in its promise to its clients: “How many dollars are you generating in terms of revenue and sales, when partnering with influencers to drive commerce?”
This approach of focussing on ROI, Lammertink says, is particularly apt for established markets like the US and Europe. He says the same approach has already created huge traction in a market like Asia, where there are major platforms dominating the market.
Lammertink adds, “Asia is more mature but I think we really look at Asia when it comes to content and creative formats and applications of commerce. The systems that are being deployed to drive revenue and drive commerce by partnering with influencers are much more advanced in Asia at this time.”
In a nutshell, Lammertink is one of those leaders in the creator’s economy who believes influencers should change the lens through which they view the scope of their content. He wants both brands and influencers to move away from traditional agency metrics (which Lammertink calls “vanity-metrics”) and look at numbers that are actually impacting the bottom line. In one simple change, the Cirqle is looking to convert influencers from content creators to entrepreneurs and leverage brands equity to help and empower that change.
After demonstrating how the platform works, Lammertink proudly says the influencers/creators using his platform will be happier by definition. This confidence stems from the fact that both major brands like Martini, CVS Pharmacy, and Uber Eats rely on the platform’s transparency. For creators, the opportunity is to work with some of the biggest brands in the world. For brands, the opportunity is to work with creators who move the needle for their business.
Techleap.nl’s Rise helps unlock value
The Cirqle is one of those startups that had applied for Techleap.nl’s Rise programme a few years earlier as well. Lammertink says they reapplied to check if they had managed to check what they were missing back then. He says they were admitted to the programme because they were bootstrapped and making big revenue and were transitioning the business from agency to SaaS.
The startup based in Amsterdam also applied for the programme to look at handholds across different facets of its business. “We wanted to see what areas we needed to focus on and what areas were actually performing well,” Lammertink says when explaining his reasoning to join the Rise programme.
Most entrepreneurs join the Rise programme with the intent to learn how to grow their business further. Lammertink says the theme of finding what’s wrong with your business and learning how to fix it attracts him. He says accelerators focus on finding the problem but don’t always go the extra step of finding a solution.
He says the Rise programme has done really well with helping entrepreneurs find a problem and offering them help to fix it through several highly personal and curated learning and practical sessions. Steven Lammertink says the Rise programme helped him transform from being an agency to becoming a SaaS platform.
The path ahead
Since its founding in 2014, the Cirqle has raised €1.3M in the form of Seed funding but Lammertink says the startup is looking to raise Series A during the fourth quarter of this year. While he did not disclose the size of this round, it would be reasonable to expect him to raise at least €10M since the balance sheet will support such funding.
With the funding, Lammertink says the Cirqle will look to build a stronger foothold in the US market but also across the rest of Europe. The funding will also be used to rebuild the product to support the growth. He is also cognizant of the market dynamics where the likes of Y Combinator and Sequoia Capital are warning their portfolio companies to “plan for the worst.”
It is profound to see what Lammertink has built. The Cirqle is a software-as-a-service platform that charges monthly fees from its clients for using its software to access half a million influencers. It also charges a small fee from the earnings of its influencers and it does all that with total transparency.
As a founder and keen observer of the creator economy, Lammertink says he wants The Cirqle to pay out a billion dollars to creators by 2026. It aims to do that by driving $4 billion dollars in transactions for its brand-partners and also by hiring software engineers to make the platform capable of supporting the volume.
Catch our interview with Paul Down, Head of Sales at Intigriti.
