The online marketplace startup that lets users buy, sell and stream creative content is now renting movies. As of today, 28,000 video projects will be available for rent, including 2,000 full-length feature films.
Sellers can now make a product available for rent as well as sale at a price of their choosing, while consumers will have 30 days from the time of renting to begin viewing and 72 hours of all-you-can watch after the first view.
Gumroad, founded in 2012, hosts 150,000 products created by 10,000 people, many of them part-time artists. Users sell by uploading a file and generating a shortened link to be shared on social media. Buyers then pay by credit card and receive a link to content via email.
"About a year and a half ago we started seeing real traction," says founder Sahil Lavingia says over the phone from San Francisco. "It's been gradual. We got early traction in music and then in publishing; today publishing is the biggest industry we support."
The last time I spoke to Lavingia in 2012, he was a plucky 19-year-old working out of a cramped loft who had just raised $8.1 million for a great idea of how to sell stuff. Now Gumroad has 20 employees and, while still not profitable, has not taken on any more cash. Instead, it's positioning itself to become the place for indie creatives to distribute their projects directly.
"I'm pretty hopeful that film, music, and publishing will be the major industries on the platform," says Lavingia, who still owns a majority stake in the company.
Publishers have already taken note: In December 2014, Gumroad partnered with Amazon-combatting publisher Hachette. Author Amanda Palmer, who has over 1 million
the first 100 people to buy "the art of asking" using this historic tweet will get a signed manuscript draft page! https://t.co/5uJgcFEC6T
— Amanda Palmer (@amandapalmer) December 11, 2014
Gumroad says it does not consider itself a direct rival to Hulu and
"We realized somewhere in the last three years that it wasn’t purely about the payments," 30 Under 30 Technology honoree Lavingia remarked. "There's much more to allowing creatives to make their livings doing what they love, rather than just a functional ability to sell something."
Part of that comes from add-ons such as streaming, rentals and mobile access. Gumroad launched its iPhone app in 2014, following up with an Android version last month which lets users stream, listen and read from Gumroad on the go.
The company itself does not make money from rentals or streaming. Instead, it generates revenue by retraining 5% + $0.25 of each sale. The margins are lower than ebay’s 9% cut or iTunes’ 30% fee, but, Lavingia says, helps artists earn money. Gumroad won't share specifics but says "many dozen" people make their living from sales on the site, with "more and more" passing the six-figure income mark.
"Rental functionality is a crucial piece of the puzzle for the future of online film distribution," said Gumroad's head of growth, Ryan Delk. "We're excited to launch this major feature to empower filmmakers — and all creators — to effectively distribute their work directly to their audience."
Desiree Akhavan's "Appropriate Behavior" debuted at Sundance and is now available for rent on... [+]
Desiree Akhavan is one such filmmaker distributing her movie, Appropriate Behavior, on Gumroad. “I'm really lucky to be making content in an age when filmmakers can facilitate a direct connection to their audience," said Akhavan, who wrote, directed and starred in the movie.
Indeed, creators like Akhavan could theoretically crowdfund projects with Kickstarter or Patreon and independently distribute with Gumroad. And while it remains to be seen if Gumroad can scale enough to keep itself afloat with such slim margins, the future of self-sustaining DIY art is very, very bright.
