The Strange Tale of Gumlord

How a Beloved Character Turned Against Its Creators

Creators roam the streets of the Internet with rakes.

Gumroad implemented (arguably) one of the most ridiculous price increases in history. Gumroad founder Sahil quietly put his platform's price increase on the slide and tweeted.

He didn't announce it to the customer first.

As you can imagine, they were outraged when they found out secretly. Gumroad then emailed everyone about the price increase after the fact.

Here's how and why it all happened. Let us simplify this complex situation so that you can use the information to your advantage and make money online.

Why Everyone Uses Her Gumroad

Let's get to the heart of the matter.

The Creator Economy is huge. Everyday people want to sell courses, books, checklists, coaching, memberships, SaaS, and more without fuss. They need another git to run their tech. Enter Gumroad.

Gumroad is a registered dealer. Simply put, this means that you, the creator, are not the seller. Refunds, taxes and receipts are handled by Gumroad. It is a huge burden that is now gone.

Gumroad also allowed customers to pay with credit cards through her Stripe, Apple Pay, Google Pay, or PayPal. The more payment methods you have, the more sales you get.

Many platforms do not provide this. The latest innovation

Gumroad brings to the table is their attractive affiliate offer. The psychology of the Gumroad platform is that you buy a product, if you like it, refer it to other people and earn affiliate commissions.

Affiliates is nothing new, but the virality of this feature was a game changer. Gumroad was used by many YouTubers selling their content on Twitter.

So when a Twitter user saw that you sold goods on his Gumroad, it immediately gave you credibility, and users trusted you more.

Gumroad's Mass Exodus

People say they always stay away from Elon's tweet platform.

But most people don't do it, or just shut up and come back within a few days. A mass escape from Gumroad is different.

I run a large private community of developers. I haven't seen people leave his Gumroad since the announcement. No, I've seen them move briskly. A friend of mine, Art of Purpose, made his $73,000 in Gumroad sales. went.

Screenshot from Art of Purpose via this tweet

Thomas Frank, who wa making $100,000 a month at Gumroad, also quit soon after. I read Gumlord's tweet reply, and many people are on board.

Why?

Big Creators increased his price by 300%. A small creator he has increased by 200%. Other than

Gumroad, my shop has had some terrible price increases. Hosting plans are up! Zapier price has increased. The Teachable eLearning platform I use has also added a significant price increase.

It will be difficult if all tech companies raise prices at once. This makes users question the value of their software more. Gumroad founder Sahil says he had no choice. Prices had to go up.

Inflation Means Rising Prices

The Tech Bubble Has Bursted And Investors Are Demanding Earnings Not Just His BS Rating And 'Being Profitable Within 10 Years'

Rising Interest Rates

These The reasons may be valid, but the market does not care. No one sympathizes with corporations.

Gumroad's competitors are offering much lower rates and people are abandoning ships to avoid the 300% price increase. Fair is Fair Any company can raise prices. But customers don't have to pay for it LOL.

Centralization Problems

Many of you have heard of Web3. The idea is that the new internet will be built on a decentralized blockchain. The blowing up of Gumroad is a perfect example of why it's necessary, one day our tech brother woke up and decided to raise the price he's 300%.

He did not tell the guest.
He is not collecting data.
He did not speak to the community of buyers and sellers.

He just thought, "I need more money, let's raise the price."

It was all dishonest. His new Gumroad prices are a flat 10% commission. What they don't tell you is that Stripe rates are now on top. So the new price is actually 13%.

No democratic decisions are made when control is centralized.

This is a fundamental problem with Web2 technologies like Gumroad.

In the world of Web 3, your company becomes a DAO (Distributed Autonomous Organization). Businesses are run on the blockchain by employees, users and investors. If there are major changes, a vote will be held. A democratic decision will be made.

Web3 data belongs to you and is designed to be portable, so if you don't like this decision, you can easily migrate your data from one platform to another.

When users are no longer ruled by a dictator designed to extort as much profit as possible for their own financial gain, it becomes harder to cheat. Advantages over

Gumroad We did some research to see where

Gumroad users were flocking.

The main alternatives are ConvertKit eCommerce, Clickfunnels, and Podia. The biggest winner seems to be ConvertKit. They charge a flat 3.5% fee and use email software that many of the big developers already use. smart companies offer free migrations from Gumroad.

The only drawback I've seen with Gumroad's competitors is that many of them don't charge taxes or allow their customers to pay with PayPal. I hope these minor flaws will be fixed soon.

Gumroad Advantages No one talks Most people who write about Gumroad are amateurs. missed him one of the biggest points of the entire story. Let me tell you the other side of the story. Gumroad could be a price hole. But don't dismiss the platform.

One of the hardest parts of selling digital products online is finding customers to buy them. Many developers use social media to build an audience and sell their products to those people through Gumroad.

This is a lot of work. However, Gumroad has a discoverability feature that has caught our attention. Users visiting Gumroad can now search for suitable products on the platform and view your products.

So Gumroad charges 10%, but can also refer clients.

This feature will grow over time and Gumroad may be worth it.Competitors don't offer discoverability. Build your own social media audience, convert it into a mailing list, and send it to Gumroad's competitors.

Gumroad also allows you to manage mailing lists for free with no limits. Purchasing an email software provider can be expensive, but with Gumroad you can effectively solve this problem. Do not miss it.

One last thing to note is that while 10% plus Stripe's fees are expensive, the Apple App Store charges creators and businesses €30.

This is comparable to peanuts.

Final Thoughts

Can Gumlord Survive?

Suspicious. Their brand is dead and they have killed their biggest marketing source, the great creators. Even if they survive, they will be left with small creators who don't bring in much money.

The lesson for you here is simple:

Don't let technology platforms run your life. Always make sure your audience and money-making opportunities are viable. And if the platform is screwing you, stay away.

Location:

Zallahmed