Online creators and their business models were on the mind this week after mega-popular YouTuber MrBeast announced his company is buying fintech startup Step, followed by Hollywood studios sending a flurry of cease-and-desist letters to ByteDance over the launch of its new video generation model Seedance 2.0.
These seemingly disjointed 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 generative AI tools on the horizon.
In the latest episode of TechCrunch’s Equity podcast, Kirsten Korosec, Rebecca Bellan, and I discussed what’s next for the creative economy and whether there will be room for the next generation of creators to stand out.
“What’s the next saturation point?” Kirsten wondered. “Not all of these people can go out and churn out products. So the pool of successful creators is simply getting smaller? Or is something else going to happen, technologically, or another medium that will allow them to find an audience to monetize?”
You can read a preview of our conversation, edited for length and clarity, below.
Anthony: [The news] led our colleague Lauren to do this great piece talking about the creator’s business model in general, and this feeling that they are no longer solely dependent on ad revenue. I think that’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 foods, including chocolate, that’s making hundreds of millions of dollars, and it was actually profitable for him in 2024, whereas his media business was losing money. All of that was pretty crazy to me.
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Kirsten: If Mr. Beast can’t be profitable with his media company, then who can? For me it was a great state.
I’m not surprised that the whole ad revenue biz game isn’t necessarily working for creators and influencers because it just hit a saturation point. I guess my big question is, what is the next saturation point? Not all of these people can go out and churn out products. So is the pool of successful creators simply getting smaller? Or will something else happen, technologically speaking, or another medium that allows them to find an audience to monetize?
Rebecca: It’s interesting, there’s a lot of ways you can think of what else could happen, right? Maybe they want to create digital twins of themselves and put their digital twins into a lot of different situations that can make them [other kinds of] money.
But again, going back to it’s not surprising these people are now celebrities, right? Someone told me on the phone recently that a lot [the] younger generation, they don’t know our celebrities, they know TikTok celebrities. And we’ve seen celebrities for years giving up products and making money off of them, right? I used to see Rachel [Ray]she was a famous chef and she sold her EVOO or her olive oil.
We Slow Ventures on [Equity] sometime last year. They have a maker fund and what they’re doing is they’ve raised a VC fund to essentially support makers with their businesses, if maybe they have a niche following, maybe they’re really into woodworking and here’s their collection of chisels, I don’t know.
I think it’s an interesting way forward, and it’s something that we see as journalists: how do we also try to be creators and make a brand of ourselves so that we can diversify our revenue. It sounds terrible to say it out loud like that.
Anthony: I smile, but it is the smile of someone whose soul is slowly turning to ashes inside.
So we took a break from talking about AI, but I will obligatorily bring AI back into the conversation. One of the other related developments over the past week or so, of course, is that ByteDance, which is the Chinese company that launched TikTok and is still an investor — we won’t get into all of that — they launched a new version of their model, Seedance 2.0, which was, at least initially, only available to Chinese users.
But you started seeing people posting videos generated by Seedance, including this viral video of Brad Pitt fighting Tom Cruise. It prompted both this general conversation about: Is Hollywood doomed? And then more specifically, a bunch of Hollywood studios, including Netflix, sending ByteDance letters saying, “You can’t do this, you’re basically allowing all of your users to generate 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 this without any real bumpers, but we’ll do better in the future.”
Kirsten: So the timing of this is just perfect because I happen to be editing a story right now that Rebecca wrote. It has nothing to do with Seedance, but it has to do with AI and filmmaking. So I want to give a future ]rop to Rebecca for being timely about it. Rebecca, I know you have a lot to say about it besides Hollywood being upset. Is it more complicated than that?
Rebecca: Yes, definitely. I mean, when it comes to the creators, I think a lot of people are going to use these tools to produce all kinds of content, and we’re just going to be completely inundated. And it gets intense.
But when we talk about whether it’s creating movies or ads or just content in general using AI video tools, I think there’s this tension between one, it’s going to produce a whole lot of low stakes versus two, it could also democratize access for a lot of people who don’t have the funds or the budgets or the teams to share a lot of the stories that they want to tell.
And also, if you’re a small business and you want to do a little shampoo ad — to be on the nose of it because there’s a shampoo ad that goes viral — or you sell coffee and you want to do a little ad for that, [this] could give you the tools to do so. Is that a bad thing? Isn’t that a bad thing? Do we need more content in the world? There are a few ways to go down.
Kirsten: Is that a bad thing, Anthony?
Anthony: As for the creator side of it, my general feeling is [that] the answer to a lot of this kind of nonsense – frankly, a lot of it is slop, and I think it will continue to be the case – will be this appreciation of authenticity. And then there’s the possibility that these great creators are less about the idea of, “I have myself digital twins,” but [instead,] “No, I’m the real Mr. Beast, not the digital simulacra wandering around.”
And I think that’s also telling – of course all social networks have ups and downs, but that OpenAI’s Sora, as far as I understand, took off in the beginning and has been struggling to keep users lately because there’s a certain emptiness in the experience when you just feel like there’s not an authentic human being on the other side.
But I also think it will make the landscape much more challenging, both for the established creators to make money from […] and then I think it’s going to be especially difficult for new creators because there’s just so much more coming. Trying to break out will be super hard.