Contently’s Attempt to Charge Payment Fees Provokes Freelancers

Media workers were infuriated when Contently attempted to tack on extra fees.

By Study Hall staff writer Allegra Hobbs (@allegraehobbs)

Contently is a marketplace, a semi-closed platform, that mediates between freelancers and brands — including big names like American Express, Morgan Stanley and Marriott — that want content. For the past nine years of its existence, it has graciously allowed freelancers to collect the entirety of their paychecks from the clients. But on Wednesday the company announced that it would, as of April 2, slap a 4.75% fee on freelancers each time they cash out their fees. (The site’s CEO now seems to be waffling on the policy, but has not offered a clear explanation.)

The site is a simple meeting point. Brands use the platform to browse talent and connect with freelancers who can create content for them. Creators can use Contently (and its educational site The Freelancer) to set up portfolios for clients and then find work. The system also contains a built-in payment mechanism, so creators can get paid by their clients immediately through Contently before cashing out to PayPal (the service that was previously free).

Media workers, predictably, were infuriated by the change — many took to Twitter to call out the predatory practice, some calling on freelancers to discontinue using Contently while the fee remains in place. Yet for some who use it, tossing aside the service that connects them to clients isn’t so easy, and could mean missing out on a significant chunk of income. That’s why Contently can bank on added revenue from the new fee: they control the market.

Brian O’Connor of digital marketing and content agency Brunch Money, had strong words for Contently CEO Joe Coleman after being alerted to the new fee — he sent an email to Coleman calling the practice “absolutely disgusting” and calling Contently a “meaningless conduit between two parties.”

“I’m glad that stealing money from my child’s mouth by way of this new fee helps you reap even bigger rewards for contributing nothing during the work I slave over,” he wrote.

But O’Connor will not be leaving Contently behind, he told Study Hall. He uses Contently to connect to one major client, which has given him eight gigs so far this year at $600 to $800 a pop. His best bet at maintaining that connection is through Contently, he explained. It’s a pain for companies to independently vet contractors and jump through the regulatory hoops rather than onboarding through Contently. “It’s not as easy as saying, well, we won’t use the system anymore,” said O’Connor. “If we don’t use the system anymore we lose out on making 800 bucks a story.”

Contently’s inserting itself as a “gatekeeper” and then demanding a cut of the creator’s profit is maddening, said O’Connor, because the platform doesn’t offer anything outside of serving as the connector. “It’s like an apartment broker — you realize that’s money going to someone who’s not providing you with any kind of benefit.”

So why does the site suddenly think it needs an unearned cut of workers’ paychecks to keep functioning? Contently has yet to provide a satisfactory explanation, mostly resorting to hollow jargon about how the fee is ultimately for the good of the freelancers.

“This will enable us to provide better opportunities for freelancers and brands for years to come,” wrote CEO Joe Coleman in a statement to Study Hall. “Every penny generated gets reinvested back into the business.” He added the company explored alternatives, but they would have cost more or “made it impossible to continue supporting instant payments and subsidized kill fees.”

When pressed on what, if any, additional services Contently planned to offer, a Contently spokesperson wrote that the company would soon be announcing “a collection of upcoming offerings and services for freelancers that are still in development,” though the model of the site will not be significantly overhauled.

As for why this additional revenue is suddenly needed, Contently’s spokesperson wrote, “We’re always trying to grow and improve the company. We implemented this policy to enable us to scale responsibly and reinvest in managing and serving our talent network. It is a proactive move to support our work with freelancers and brands.” Nothing had changed to create a need for additional revenue, they insisted. It’s just about profit margins.

Contently is a venture capital-funded company that has gone through three rounds of investment to raise $19.3 million (the spokesperson said pressure from investors was not the reason for the new fee). As noted by Inc, it already collects a 15% fee from clients, plus subscription fees from corporations that use the platform. It is difficult to imagine how it could possibly justify taking money from freelancers and then acting like it’s doing freelancers a favor. Freelancers seem to view Contently as little more than an unfortunately necessary middleman.

Patreon, which serves a similar function to Contently in that it gives creators a painless way to get paid for their labor, underwent a similar scandal in December of 2017. The site abruptly changed its model for processing payments, foisting the payment-processing fees on patrons rather than creators. Patrons rebelled, dropping their subscriptions en masse, infuriating creators who watched as their revenue crumbled. Patreon ended up reversing the decision in response to the backlash.

Contently may in fact follow Patreon’s example and listen to its users. Coleman on Saturday seemed to be reconsidering the fee, telling a disgruntled Contently user on Twitter that the company had simply failed to make clear it would “offer other options” — contradicting Coleman’s previous allegiance to the cash out fee. There had been no other options just two days before.

It’s worth noting that this year has, so far, not been especially kind to media workers — mass layoffs have pushed former staffers into freelancing, flooding an already saturated field, while existing freelancers have been left in the lurch by the abrupt firings of their editors. Freelancers for Pride Media continue to clamor for the tens of thousands of dollars that they are collectively owed.

Given these dark realities, there is very much a market for platforms allowing independent contractors to more easily sell their services to paying readers and clients. Self-publishing platforms like Substack and Patreon were built to make it easier for creators send their content directly to subscribers, and have indeed seen a spike in popularity as writers become frustrated with the traditional route of pitching and placing content. Contently is another platform ostensibly created to serve the needs of creators striking out on their own. Its sudden shift to predatory payment models feels like a betrayal, on top of everything else freelancers have to endure.

Renee Sylvestre-Williams, a freelancer who uses Contently, said the additional cut wouldn’t make or break her income, but it’s already so difficult to make a living as a freelancer, the latest blow smarts. “Prices are already so depressed as it is that this just seems to be a further kick in the pants,” she said.

At the very least, it seems likely the site can expect to say goodbye to creators who can manage to leave. It’s just a question of whether it is manageable, and for how many. Sylvestre-Williams said she is hoping her clients will be amenable to paying her off of the platform.

“Personally, I think those who can afford to not use Contently can walk away, which is going to leave freelancers who can’t in the very unfortunate position of not being able to negotiate and having to pay these fees. On the client side, they may be losing some really strong freelancers.”

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