--- title: Learnings from Paying Artists Royalties for AI-Generated Art description: Kapwing's founder shares a candid postmortem on Tess.Design, an AI image marketplace that paid artists 50% royalties when their fine-tuned style models were... canonical: https://daily.dev/posts/learnings-from-paying-artists-royalties-for-ai-generated-art-ciebenyb1 twitter:card: summary_large_image twitter:site: @dailydotdev og:type: website og:site_name: daily.dev og:title: Learnings from Paying Artists Royalties for AI-Generated Art | daily.dev og:description: Kapwing's founder shares a candid postmortem on Tess.Design, an AI image marketplace that paid artists 50% royalties when their fine-tuned style models were... og:url: https://daily.dev/posts/learnings-from-paying-artists-royalties-for-ai-generated-art-ciebenyb1 og:image: https://api.daily.dev/og/posts/cIeBeNYb1.png og:image:alt: Learnings from Paying Artists Royalties for AI-Generated Art og:image:width: 1200 og:image:height: 630 og:locale: en --- > ## Documentation Index > Fetch the complete documentation index at: https://daily.dev/llms.txt > Use this file to discover all available pages before exploring further. # Learnings from Paying Artists Royalties for AI-Generated Art **[Hacker News](https://daily.dev/sources/hn)** · 9 min read · 0 upvotes · 0 comments ## Summary Kapwing's founder shares a candid postmortem on Tess.Design, an AI image marketplace that paid artists 50% royalties when their fine-tuned style models were used. Launched May 2024 and shut down January 2026, Tess generated only $12,172 in gross revenue against $18,000 in artist advances. Key lessons: artist supply is extremely hard to build one-by-one due to ideological opposition and brand dilution fears; unresolved AI copyright litigation blocked enterprise deals; the 2024 cultural climate was maximally hostile to AI among creatives; and running a side project split focus from the core Kapwing product. The author argues the underlying royalty-based AI licensing model isn't dead, just early, and advises future founders on creator adoption challenges, brand controls, and timing. ## Full article daily.dev links to this article rather than hosting it. Read it at the original source: --- Tags: [#ai-image-generation](https://daily.dev/tags/ai-image-generation), [#creator-economy](https://daily.dev/tags/creator-economy), [#stable-diffusion](https://daily.dev/tags/stable-diffusion) [View this post on daily.dev](https://daily.dev/posts/learnings-from-paying-artists-royalties-for-ai-generated-art-ciebenyb1) ```json {"@context":"https://schema.org","@graph":[{"@type":"Organization","@id":"https://daily.dev/#organization","name":"daily.dev","url":"https://daily.dev","logo":{"@type":"ImageObject","url":"https://daily.dev/apple-touch-icon.png","width":180,"height":180},"sameAs":["https://twitter.com/dailydotdev","https://github.com/dailydotdev","https://www.linkedin.com/company/daily-dev-ltd"]},{"@type":"WebSite","@id":"https://daily.dev/#website","url":"https://daily.dev","name":"daily.dev","publisher":{"@id":"https://daily.dev/#organization"},"potentialAction":{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https://daily.dev/search?q={search_term_string}"},"query-input":"required name=search_term_string"}}]} {"@context":"https://schema.org","@type":"TechArticle","headline":"Learnings from Paying Artists Royalties for AI-Generated Art","url":"https://daily.dev/posts/learnings-from-paying-artists-royalties-for-ai-generated-art-ciebenyb1","mainEntityOfPage":{"@type":"WebPage","@id":"https://daily.dev/posts/learnings-from-paying-artists-royalties-for-ai-generated-art-ciebenyb1"},"datePublished":"2026-03-10T06:12:57.643Z","dateModified":"2026-05-21T02:15:35.328Z","description":"Kapwing's founder shares a candid postmortem on Tess.Design, an AI image marketplace that paid artists 50% royalties when their fine-tuned style models were...","image":"https://media.daily.dev/image/upload/f_auto,q_auto/v1/posts/e64d3edf404475be116f51bdab7b667a?_a=AQAEuop","thumbnailUrl":"https://media.daily.dev/image/upload/f_auto,q_auto/v1/posts/e64d3edf404475be116f51bdab7b667a?_a=AQAEuop","isAccessibleForFree":true,"articleSection":"Hacker News","inLanguage":"en","publisher":{"@type":"Organization","name":"daily.dev","url":"https://daily.dev","logo":{"@type":"ImageObject","url":"https://daily.dev/apple-touch-icon.png","width":180,"height":180}},"author":{"@type":"Organization","name":"Hacker News","logo":"https://media.daily.dev/image/upload/t_logo,f_auto/v1/logos/hn","url":"https://daily.dev/sources/hn"},"commentCount":0,"discussionUrl":"https://daily.dev/posts/learnings-from-paying-artists-royalties-for-ai-generated-art-ciebenyb1","interactionStatistic":[{"@type":"InteractionCounter","interactionType":{"@type":"LikeAction"},"userInteractionCount":0},{"@type":"InteractionCounter","interactionType":{"@type":"CommentAction"},"userInteractionCount":0}],"keywords":"ai-image-generation,creator-economy,stable-diffusion","timeRequired":"PT9M"} {"@context":"https://schema.org","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https://daily.dev"},{"@type":"ListItem","position":2,"name":"Hacker News","item":"https://daily.dev/sources/hn"},{"@type":"ListItem","position":3,"name":"Learnings from Paying Artists Royalties for AI-Generated Art"}]} ```