If you want to learn how to make money on Twitch, you'll love this guide.
Unlike some business models, streaming is relatively simple.
Not quick.
Not easy.
But it is simple.
If you do everything outlined in this guide, you could make enough money streaming games on Twitch to quit your day job — and, if you're really committed, maybe even make multiple six figures per year like some popular streamers.
Let's get started.
What Is Twitch?
Twitch is the world's leading live streaming platform for gamers.
You don't need to login to watch people all around the world play your favorite games, but creating a free account allows you to engage directly with your favorite streamer or stream your own content.
Twitch also has premium subscription options that unlock bonuses and freebies in certain games and allow users to support their favorite streamers.
Twitch averages in incredible 1.1 million viewers per day and over 4.5 million broadcasters per month. The platform has grown over 60% year-over-year for two years in a row, and it's not stopping.
Twitch's growth is just kicking into high gear, and that growth means more opportunity for new gamers like you to start earning a real income from your favorite pastime.
Part 1: How Do People Make Money On Twitch?
There are quite a few different ways to earn money through Twitch.
To start, we'll break down the income of Twitch's two most popular streamers: Ninja and Shroud.
The #1 Twitch streamer in the world right now is Ninja (aka Richard "Tyler" Blevins), who earns over $5.5 million per year streaming Fortnite and other massively popular games. To get to that level, however, you would need about 12 million subscribers (the number Ninja currently has).
Here's an estimated breakdown of how much Ninja makes based on income stream. (Don't worry—we'll explore what each of these streams means in detail later in this article)
- Subscriptions - $3,955,571
- Ad Revenue - $509,521
- Bit Donations - $316,354.92
- Average Sponsorship - $600,000
- Average Estimated YouTube Compensation - $36,000
The second-most-paid Twitch streamer is Shroud, who makes about $3.3 million per year. Here's the estimated breakdown of his revenue:
- Subscription - $2,316,404
- Ad - $182,751
- Bit Donations - $57,942
- Average Sponsorship - $600,000
- Average Estimated YouTube Compensation - $36,000
As you can see, the majority of their income comes from subscriptions and sponsorships, as is common among most of the high earners on Twitch.
Now, let's take a closer look at each of the pieces that contribute to Twitch income.
A. Subscribers (Twitch Partner Program)
The #1 revenue source for Twitch streamers is their subscriber base.
On Twitch, viewers can opt for one of three subscription levels — $4.99, $9.99, or $24.99. Initially, as a streamer you split the income from a subscriber 50/50 with Twitch. As you become a larger broadcaster, however, you can earn a bigger percentage; up to 100% in some cases.
The best part about subscriptions is that it's a recurring income. You'll earn this revenue every month, which is great for stability and knowing you (probably) won't go broke in any given month.
However, you have to be invited to Twitch's Partner Program to be able to earn subscribers. And given there are only ~12,000 Twitch partners out of over 1.7 million active broadcasters, it's not the easiest thing to do. More on this in the "How to Build a Profitable Twitch Audience" section.
B. Collecting Bit Donations
When you're first starting out, the most common revenue source from Twitch is through bit donations from your audience. "Bits" are Twitch's virtual currency viewers can buy and redeem to use "Cheer" emotes in their favorite streamer's chatroom.
These animated emoji (pictured above) are called "Bit gems," and when your subscribers use them in your chat room, Twitch pays you $0.01 per bit.
Broadcasters can also create their own custom emojis called "Cheernotes" which work in the same way, but look different. (This feature is reserved for Twitch Partners.)
C. Advertising Revenue
According to CNBC, the average Twitch streamer makes $250 per 100 subscribers from ad revenue. Again, ads are reserved for Twitch Partners.
Twitch offers standard IAB (Interactive Advertising Bureau) pre-roll and display ads. They pay streamers using the CPM (Cost Per Impression) model—you get paid for every 1,000 views of your ads.
Note that ad revenue has been dropping lately due to the rise in ad blockers, but you can combat this by directly asking your viewers to turn off their ad blockers while streaming your content.
D. Paid Livestreams & Sponsorships
Once you gain a following and/or develop a relationship with companies looking to market their products, you can get sponsored by a company to promote them during your live streams, wear their merch, and use their products on camera.
For example, if we look at Ninja's room, we can see him promoting Bud Light and DXRacer chairs, both of which probably pay him to display them.
Another form of sponsorship is a paid live stream, where game developers will pay broadcasters to live stream their game and get it in front of a new audience in the hopes some of them will start playing the game as well.
E. Affiliate Marketing
Affiliate marketing simply means promoting a product or service and giving your audience a coupon code. Any time someone purchases the product using your coupon code, you get a cut of the sale (or a flat fee).
For example, let's say you love the gaming chair you use. So you work out a deal with the company that manufactures it, and they give you a coupon code which you then share with your followers. Any time someone uses your coupon code and buys that gaming chair, the gaming chair company cuts you some of the profit.
Here's an explanation chart of how this works
Note: You can use coupon codes, tracking links, or cookies to verify that the sale came from your audience.
It's like a sponsorship, but rather than being paid just to show the product, you have to actually get people to purchase one. If you have a large following, affiliate relationships can often be more profitable, because you can make more in commissions than you would from the sponsorship.
Of course, this depends on the commission you're making and how much your audience actually buys, so you'll have to run the numbers to figure this out. Affiliates are one of the first ways you can make money on Twitch without becoming a Twitch Partner, though!
F. Getting Signed To An Esports Org
Did you know the average esports salary is about $60,000 per year? The top esports players even make $1-$3 million per year.
While this income won't come directly from Twitch, showing off your skills on stream can get you seen by and signed to an eSports team.
It's a long shot admittedly, but then again, making a full time income via any method on Twitch is a long shot for most streamers as well.
