Online creators and their business models have been on our minds this week after mega-popular YouTuber MrBeast announced his company is buying fintech startup Step, followed by Hollywood studios sending ByteDance a flurry of cease-and-desist letters over the launch of its new Seedance 2.0 video generation model.
These seemingly unrelated headlines suggest a media landscape in the midst of transformative change, as popular YouTubers seek to diversify their business models with the threat and promise of increasingly powerful AI generative tools on the horizon.
On the latest episode of TechCrunch’s Equity podcast, Kirsten Korosec, Rebecca Bellan, and I discussed what’s next for the creator economy and whether there will be room for the next generation of creators to excel.
“What’s the next saturation point?” Kirsten wondered. “Not all of these people can go out and make products. So then does the pool of successful creators just shrink? Or does something else happen, technologically speaking, or a different medium that allows them to find an audience to monetize?”
You can read a preview of our conversation below, edited for length and clarity.
Anthony: (The news) led our colleague Lauren to do this great article about the business model of creators in general and how they no longer rely solely on ad revenue. I think it’s still a pretty big part of their business, but she broke down a number of the most popular YouTubers and noted that each one is expanding — usually into e-commerce, but also into other revenue streams.
Mr. Beast, for example, actually has this line of food products, including chocolate, which is making hundreds of millions of dollars and was actually profitable for him in 2024, while his media business was unprofitable. It was all pretty wild for me.
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Kirsten: If Mr. Beast can’t be profitable with his media company, who can? To me, that was a staggering statistic.
It doesn’t surprise me that the whole ad revenue game for creators and influencers isn’t necessarily working because it just hit saturation point. I guess my big question is what is the next saturation point? Not all of these people can go out and separate products. So then the pool of successful creators is simply shrinking? Or will something else happen, technologically speaking, or another medium that allows them to find an audience to make money on?
Rebecca: It’s interesting, there are many ways you can think about what else could happen, right? Maybe they create digital twins of themselves and put their digital twins in many different situations that can make them (different kinds of) money.
But then again, going back to the fact that it’s not surprising, these people are celebrities now, right? Someone recently told me on the phone that a lot of the (younger) generation doesn’t know our celebrities, they know TikTok celebrities. And we’ve seen celebrities launch products and make money off of them for years, right? I was watching Rachel (Ray), she was a celebrity chef and she was selling her EVOO or her olive oil.
We Slow Ventures on (Equity) sometime last year. They have a creator fund and basically what they do is they put together a venture capital fund to basically support creators with their business if maybe they have a fan niche, maybe they’re really into woodworking and here’s their chisel collection, I don’t know.
I think it’s an interesting way forward and it’s something that we see as journalists: How we also try to be creators and make ourselves a brand that we can diversify our income. It sounds awful, saying it out loud like that.
Anthony: I smile, but it’s the smile of someone whose soul is slowly turning to ash inside.
So we took a break from talking about AI, but I will definitely bring AI back into the conversation. Of course, one of the other related developments in the last week or so is that ByteDance, which is the Chinese company that launched TikTok and is still an investor — we won’t go into all that — launched a new version of their model, Seedance 2.0, which was, at least initially, primarily available to Chinese users only.
But you started seeing people posting videos made by Seedance, including this viral video of Brad Pitt fighting Tom Cruise. This prompted both of them to have this general conversation: Is Hollywood doomed? And then more specifically, a lot of Hollywood studios, including Netflix, were sending letters to ByteDance saying, “You can’t do that, you’re basically allowing all of your users to make videos using all of our IP, all of our movie stars.” And for a few days there was no response at all from ByteDance, but then they said, “Sorry, sorry, sorry, for some reason we launched without real railings, but we’ll improve in the future.”
Kirsten: So the timing is perfect because right now I’m editing a story that Rebecca wrote. It has nothing to do with Seedance, but it has to do with AI and filmmaking. So I’ll give Rebecca credit for figuring this out in time. Rebecca, I know you have a lot to say about this other than Hollywood being pissed off. Is it more complicated?
Rebecca: Yeah, sure. I mean, if we combine that with creators, I think a lot of people are going to be using these tools to produce all kinds of content, and we’re going to be absolutely inundated. And it will be intense.
But when we talk about whether it’s making movies or ads or just content in general using AI video tools, I think there’s such a tension between one that it’s going to lead to a lot of small efforts versus two, it could also democratize access for a lot of people who don’t have the funding or the budgets or the teams to share a lot of stories that they want to tell.
And also, if you’re a small business and you want to do a little ad for shampoo — just so you know, because the shampoo ad went viral — or you’re selling coffee and you want to do a little ad for it, (this) could give you the tools to do that. Is this a bad thing? Isn’t that a bad thing? Do we need more content in the world? There are several ways to walk.
Kirsten: Is it bad, Anthony?
Anthony: As far as creators go, my general feeling is (that) the response to a lot of this kind of stupidity—frankly, a lot of it is slop, and I think it will continue to be that way – it will be an appreciation of authenticity. And so the opportunity for these great creators is less about thinking, “I have a digital twin,” but (instead), “No, I’m the real Mr. Beast, not a digital simulacrum walking around.”
And I think it’s also telling—of course, every social network has its ups and downs, but OpenAI’s Sora, as I understand it, skyrocketed in the beginning, and lately it’s been struggling to retain users because there’s a certain emptiness to the experience when you just feel like there’s not an authentic human being on the other end.
But I think it’s also going to make the landscape a lot more challenging, both for established creators to monetize (…) and I think it’s going to be especially hard for new creators because there’s going to be a lot more stuff. Trying to actually break free will be very difficult.