How OnlyFans Grew Its Revenue by 2000% in Just Four Years

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OnlyFans has managed to do what many other businesses have failed at. It took a product people were used to accessing for free, adult content, and convinced them to pay for it. The business model of being naked online was fairly broken, but they managed to piece it together to some degree. In just four years, the company's revenue grew more than 2000%, bringing in $6.6 billion in 2023. Now other social media platforms are eager to implement subscriptions, but it's more complex than that. Many people mistakenly believe that simply posting sexy pictures in lingerie will generate significant income.

Despite resembling other social media platforms, OnlyFans' underlying business model is different. It appears that OnlyFans's approach has been to determine the legal boundaries and then operate within a safe distance of them. This is why the platform is not available on major app stores, and the company claims to have intentionally created a difficult-to-use search function. Now, OnlyFans is capitalizing on the evolving creator economy to establish a new type of social media. This is "The Economics of OnlyFans."

OnlyFans’ origins

One of the aspects that intrigued me most about the business model was its stark contrast with traditional social media. Most social media companies like Facebook and Instagram generate revenue from advertisers, whereas OnlyFans derives all its income directly from its creators, and these creators in turn earn money directly from their fans. Our revenue stream is entirely dependent on the success of our creators.

Creators can charge fans up to $50 per month for their content, a significant portion of which may be explicit, while some is not. The company retains a 20% cut, while creators receive the remaining 80%, making it a more straightforward model compared to other platforms that share a percentage of ad revenue only after certain account criteria are met.

While OnlyFans did not invent the concept of revenue sharing, it benefited from opportune timing. Other websites already existed that allowed creators to directly monetize their content from fans. A few years after OnlyFans launched in 2016, social platforms like Tumblr began restricting adult content. Then, in 2020, the platform experienced significant growth.

App stores and traffic sources

The platform boasts a user base considerably smaller than giants like Facebook, YouTube, or Instagram, but there's a crucial distinction: OnlyFans is not available on most app stores.

OnlyFans operates against the current, largely due to Apple's terms of service, which prohibit the full-time operation of pornography. This decision was made strategically, anticipating a substantial volume of payment processing. By avoiding app stores, OnlyFans circumvents the 15-30% commission that Apple and Google typically charge on app transactions. This has allowed them to maintain their 80-20 revenue-sharing model, a cornerstone of their business operations. If they were obligated to relinquish 30% of their 20% to another entity, it could significantly impact their financial model.

OnlyFans has disbursed $20 billion to its creators to date, surpassing Patreon, another creator subscription platform with a longer history, by more than fourfold. Currently, the platform boasts 4 million creators and 300 million fans worldwide. The absence from app stores has not hindered its growth.

Despite its stark differences from other social media platforms, OnlyFans also exhibits symbiotic relationships. The primary source of fans for OnlyFans accounts is overwhelmingly other social media platforms. Essentially, OnlyFans outsources the task of customer recruitment to its content creators.

Creators must actively engage in groundwork, such as messaging on other platforms, advertising, and marketing their content. This leaves little time for other activities, such as watching television or sleeping.

In 2021, OnlyFans launched OFTV, a safe-for-work streaming platform as an additional marketing tool for its creators. However, to effectively monetize on OnlyFans, creators typically require an existing fan base to capitalize on. Starting from scratch on the platform can be quite challenging.

This is attributed to the company's decision to eliminate algorithm-driven search recommendations. For instance, searching for creators who post yoga content may yield limited results. Instead, users are typically required to search for the exact username to find specific creators, although the process is not always that straightforward. While we attempted a search for "yoga," we received numerous suggestions for different creators.

OnlyFans does maintain a homepage that promotes various creators' content and a suggested accounts section, which the company claims represents the most popular accounts at that time and are not personalized based on user browsing history or personal data. Nonetheless, the company relies heavily on other social media platforms to attract users.

The platform's success on this scale would not have been possible without creators effectively harnessing virality and social media, even though OnlyFans itself eschewed these mechanisms for its own platform.

Creators often experience fluctuations in their income, leading to periods of self-doubt. However, when content goes viral on platforms like Instagram, it can reignite their passion and confidence.

As the platform has evolved, it has incorporated various features to enhance user engagement and revenue streams, including tipping, pay-per-view messaging, paid direct messaging, paid live streams, and paid voice notes. Essentially, it offers a multitude of ways to consume and pay for content.

Purchases and subscriptions

Today, OnlyFans generates more revenue from one-off purchases than from subscriptions. This data provides valuable insights into user engagement and spending habits.

Microtransactions are indicative of a deepening relationship between creators and their fans. Users are willing to invest in exclusive content, unlike, for example, paying for readily available cat videos.

Many users utilize the platform primarily for social interaction and connection. They seek online companionship, engage in conversations about their lives, and seek a sense of belonging.

The company does not disclose the average earnings of its creators. While some achieve substantial income, others earn modest amounts, with many falling somewhere in between.

Even those who have achieved significant financial success on the platform, such as myself, maintain a sense of humility and appreciation. Having transitioned from a secondary school teacher relying on food banks, I understand the importance of not taking anything for granted. The realization that success can be fleeting serves as a constant reminder.

Ensuring creators are compensated fairly, regardless of their earning potential, has been a significant challenge for the business.

Working with banks

In 2021, OnlyFans faced significant difficulties in establishing banking relationships, culminating in a temporary ban on adult content by the then-CEO. This decision was quickly reversed.

The rapid and exponential growth of the company during this period likely contributed to the market's apprehension and lack of understanding regarding the sophisticated controls implemented by OnlyFans. The sheer size of the company and the volume of revenue generated understandably caused some concern.

Regarding the possibility of another ban on adult content, the company has unequivocally stated that this will not happen.

Financial institutions often categorize accounts associated with sex work as high-risk, potentially denying services or imposing higher fees, primarily due to concerns about child exploitation. While the risk associated with some of these businesses is undeniable, it's important to acknowledge that similar risks exist within general social media platforms.

Payment processors typically charge a 1-3% fee on each transaction, but high-risk accounts may incur fees exceeding 10%. This is attributed to the reputational risks associated with adult merchants, including rampant fraud and higher rates of chargebacks.

OnlyFans collaborates with a diverse range of payment providers to ensure global coverage. It's crucial to focus on mitigating actual risks rather than merely addressing headline risks.

OnlyFans now claims to be able to collaborate with institutions that have traditionally avoided working with the adult industry, having demonstrated its ability to mitigate risks through robust safety controls. While further improvements are always necessary, it's acknowledged that some banks and financial institutions may still adhere to outdated risk models or harbor moral objections.

Age verification

OnlyFans mandates that creators submit more than nine forms of identification to verify their age above 18 before they can post content. However, creating an account as a viewer is significantly easier.

I was able to create a new account within minutes using only an email address. After entering a payment method, I was prompted to scan my face using a program by Yoti to verify my age. Within seconds, I was granted access to subscribe to explicit accounts without providing any further identification.

OnlyFans asserts that every piece of content undergoes rigorous review through a combination of automated and human checks, designed to block specific words and non-consensual images. However, this system is not infallible. The company's UK regulator is currently investigating whether its face-scanning system adequately prevents underage users from accessing pornography.

OnlyFans has clarified that fan verification procedures vary depending on location. In all jurisdictions, fans are required to register with a valid payment card, confirm they are over 18, and accept the terms of service.

While Keily emphasizes the moral justification for operating the company as OnlyFans does, there's another, more unspoken, reason. When directly profiting from pornography, it's imperative to ensure that the content is legal, safe, and non-abusive.

Other types of creators

Today, OnlyFans is positioning itself as one of the most lucrative options for all types of creators within the $250 billion creator economy, actively recruiting athletes, comedians, and adult entertainers alike.

While I support the expansion of the platform to include content creators from various verticals, I also believe that OnlyFans should be recognized for its remarkable business success story.

By treating the platform as a legitimate business rather than something inherently "dirty," Only