This startup describes itself as a “Netflix for short stories”. Creators can publish stories consisting of (at most) 5 chapters and 6,000 words and will be paid when readers finish each chapter.
Readers can buy credits to read stories, or they can earn them by referring friends, reporting plagiarized stories, and continued participation. Each credit is worth 0.02 cents (a fiftieth of a cent) and a chapter can cost up to 3 credits.
Penpee is based in the UK, and is relatively new – it only launched a few months ago. According to founder Tijan Penpee, the startup currently has over 300 users.
Edit: Penpee sent me a press release with more info (DOCX).