The company teaching influencers how to get rich without going viral

Jun 19, 2023
The company teaching influencers how to get rich without going viral
Around 2017, seven years after starting his YouTube channel, Roy Martínez got an email asking if he was interested in making a living from his content. The sender, a Brazilian company he’d never heard of, had caught wind of Martínez’s channel and website, where he sold professional car repair tools and a monthly $20 subscription to videos on how to use them. Martínez had begun making the video courses alongside his auto-repair business as customers needed constant technical training. The company — Hotmart — saw potential in his videos, despite a modest subscriber base of 50,000.

Five years later, Martínez has completely stopped selling car repair tools. He now runs a 19-person operation that produces and sells courses on his website, using Hotmart’s back-end tools. His yearly subscription, which was $360 when Hotmart first reached out, now costs $497, and he also sells individual courses that go for $50–$500 to an audience of about 6,000 people. While his income has grown to half a million dollars a year, his social media following has stayed relatively small: He has around 80,000 subscribers on his YouTube channel, and just over 10,000 followers on Instagram.

Martínez’s success pales in comparison to some of Hotmart’s 135,000 other creators, many of whom are motivational coaches, nutritionists, yoga teachers, health influencers, or business consultants. Marco Antonio Regil, a former Mexican TV show host, sells his Hotmart-powered motivational courses to over 20,000 people. Brazilian lifestyle coach Wendell Carvalho is the only creator that earns more than $50 million dollars a year by selling motivational and financial courses through Hotmart. The company told Rest of World many of its other creators’ earnings are also in the millions of dollars — its cut of the proceeds starts at 9.9% of each sale.

Unlike MasterClass, a membership-based streaming platform that offers a broad catalog of classes with celebrity instructors, Hotmart does not sell courses from a central, branded site. Rather, it’s an infrastructure provider, teaching creators and giving them the tools to sell courses on their own site. It provides support to improve their content sales and distribution and, most importantly, has a payment infrastructure that allows users to buy content from anywhere in the world, in any currency. (Hotmart also offers a website building service if a creator doesn’t have one of their own already.)

It’s come to replace the patchwork of platforms and plugins — WordPress, PayPal, Stripe — that creators like Andrea Rojas have called “a technological Frankenstein.” Rojas is a Mexico-based Rojas creator focused on making content that helps viewers grow their online businesses. She was already selling virtual courses before finding Hotmart. But the Brazilian company offered her an alternative to social media’s follower-obsessed monetization model — often dependent on large numbers of views for very few returns.

For instance, under YouTube’s current policies, creators can only expect to make fewer than 2 cents per view, requiring content to go viral more often than not to make it a sustainable income source. “Hotmart’s goal is to grow your sales, not your number of followers,” Rojas told Rest of World. She has used Hotmart for seven years now, and recently made her first million dollars in content sales from her 3,100 customers.

Hotmart lessens the burden of creating fresh content constantly by leaning into evergreen productions. Instead of producing elaborate vlogs or highly edited videos every day, creators usually post low-effort images or clips, designed to funnel social media viewers to the content they sell through Hotmart — where their high-production content lives.

“[Hotmart’s system] allows me to do the hard work [of creating content] just once and make money from it for many years,” Martínez said.

“A YouTube video, an Instagram post, or a 10-second reel is not going to solve their problem the same way a course could.”

Hotmart was born in 2010 in Belo Horizonte, after creators João Pedro Resende and Mateus Bicalho noticed there was very little online content in Latin America that people actually paid for. But on seeing the success of streaming platforms like Netflix in the regional market, they detected a demand for paid quality content, Leandro Conti, Hotmart’s head of marketing communications, told Rest of World.

Ultimately, Hotmart decided that the key to success wasn’t selling to the consumers of the content, but rather, to those who created it. The company makes it clear that it does not market and distribute the content — that’s left to the creators’ own social media and other channels of communication with their loyal followers.

Creators nonetheless told Rest of World they were happy with what Hotmart does provide: a unified system that allows them to focus on the creation of their content without being bogged down by the technicalities of selling it.

They called Hotmart’s payments system the biggest benefit they’d received. When a course is made available for sale through a creator’s website, Hotmart gives them the tools they need to paywall the content. This is particularly useful in a region like Latin America, where international payment options often don’t work. Platforms like Facebook, YouTube, and Instagram — though they give creators visibility — also lack an easy payment process.

Rojas said that before Hotmart, she had mostly used Stripe to process customer payments, but she claimed transactions often failed and said the company didn’t have a dedicated customer support team in her native Mexico.

“Hotmart has a really good advantage: They accept all payment processors, credit cards, even cash payments in cornershops like Oxxo,” Sofía Macías, a personal finance creator, told Rest of World. Rojas said about 30% of her customers pay in monthly installments — something most platforms don’t offer.
Before joining Hotmart, Martínez, the car repair creator, hadn’t been able to charge clients outside of his native market of Costa Rica. Although many were willing to pay his $20 monthly subscription fee, they couldn’t find a way around PayPal’s geographic payment restrictions. This limited his pool of customers to Costa Rica, where he’d only sold a total of about 400 subscriptions over four years. The expansion of his market was particularly useful given the appeal of his car repair courses to the Latino community in the U.S., he said. “There are many Latinos there that were repairmen before they migrated.” To them, said Martínez, paying $150 or $200 for a single course was an investment.

Creators said they also appreciated the guidance on sales and marketing strategies from Hotmart’s team — skills they had not previously had. As creators make, publish, and distribute their content, Hotmart shepherds them by giving them tips on generating leads, improving SEO, and closing sales.

For Rojas, the success of this specialized pay-per-view model highlights the shortcomings of the free, ad-driven content economy. “A YouTube video, an Instagram post, or a 10-second reel is not going to solve their problem the same way a course could,” she said.

Source: restofworld