“Creator-first” is an industry buzzword, but creators are still chasing down payments

While more marketers are realizing they need creators to drive business growth, they are still not always in a rush to pay them on time. 

A recent survey found that the majority of creators have faced late payments, and social media discourse around influencer marketing agency Captiv8 speaks to the tensions of a booming yet budding industry that can lack both consistency and transparency. 

“It’s a really unequal power dynamic,” said Jessy Grossman, founder of organization Women in Influencer Marketing. “Any agreement is only as powerful as the ability to enforce that agreement, and what leverage does a creator have?” 

On April 17, Grossman turned to Linkedin to publicize discourse within her community around Captiv8, writing “Women in Influencer Marketing is telling me your payments are months delayed for hundreds, maybe thousands of creators. I’m rooting for you guys, but please be transparent about what’s going on.”

“While you’re not answering emails and making people hire lawyers to send demand letters,” she continued, “you’re costing people even more money only to receive the payment they rightfully deserve.” 

While Grossman’s post triggered echoes of allegations across social platforms, users were already turning to the comment section of Captiv8’s Instagram posts to follow up with its finance team. Under an April 5 post, creator Alyssa Manaig wrote “It’s disappointing to see a brand so active on social media but silent on my missing payment. Can we kindly resolve this.”

In response to the recent slew of reports, Captiv8 told Banknotes that some of the comments referred to partnerships where payment was agreed upon to come straight from the brand to the creator, opposed to Captiv8. While Captiv8 declined to comment on the typical nature of its contracts, it said the company’s legal terms are  “in accordance with 4A’s/IAB regulations.” 

Breaking down liability 

In a 2021 4A’s deck, the advertising association wrote, “Consider including a sequential liability provision if agency has not received all corresponding amounts in full from client prior to payment to influencer.” 

This clause of “sequential liability,” where in this context an agency or platform can withhold  payment to a creator before they receive said payment from the brand, is a cause for contention across the industry. Michael Berkowitz, partner at talent management company Greenlight Group, says he "always pushes back" on this clause when he sees it in brand contracts. 

“I understand, brands make agencies act like a bank and that is not okay,” wrote creator lawyer Tyler Chou In her own Linkedin thread following Grossman’s post, “but asking creators to act like banks is also not okay. Creators often depend on brand deals to pay rent and employees so not getting paid makes their businesses come to a screeching halt.” 

Blocking direct contact

Another talent manager said he removes both sequential liability and any clauses that delineate a talent and brand's ability to work together directly. Gigi Robinson, who said she is still chasing payments from her previous agency, said she was often reprimanded for making any direct communication with brand partners. 

“I have no shame and will email you every single day until you pay me, but when you have  a manager, you don’t have direct contact with the agencies or the brands that you’re working for,” said Robinson. “As more of a micro creator, I’m feeling very taken advantage of and in the dark." 

Taking back power 

While creators have attempted to weave late fees into their contracts, sources agree that they lack the leverage for these clauses to be taken seriously—and both Robinson and Grossman have been met with disregard when they’ve attempted to weave them into contracts.  

“When you're tight on expenses, you can’t stiff your lawyer or venture debt or bank,” said Tony Tran, co-founder and CEO of creator and freelancer financing platform Lumanu.  “A lot of companies have this internal ranking of what vendors they pay first.” 

While individual talent lacks leverage, Tran said his platform offers creators “collective bargaining power” by connecting them through one payment system. Grossman, who said that organization members and Linkedin users have since reported fulfilled payments from Captiv8, said she is celebrating any wins while also stressing the need for higher standards. 

“I want to get these people paid, but I also want to make the point that people should not be chasing you for money that you are rightfully owed,” she said. 

‍