The Real Reason MrBeast Isn’t The Next Disney & Why Brands Don’t Send Creators to Bora Bora Anymore

0:00Jasmine Enberg: Hi, everyone. This is Scalable, a weekly show about the business of the creator economy. I'm Kaya Yurieff. And I'm Jasmine Enberg. Every Thursday, we take you beyond the headlines to tell you what's happening, what it means, and why it matters. Every big creator thinks they can do the next Disney. And brands are ditching influencer trips for IRL events. We need to talk about this insane chart trip. I want to hear about civil influences being really out of touch. Today, we're going to break down both of these stories and tell you what they mean for the creator economy. We'll also give you a look under the hood at YouTube car media company Donut Media from our conversation with Max Maddox and Nolan Sykes.

0:42Jasmine Enberg: Hi, Jasmine. Hey, Kaya. Let's get into it. The comparisons between top creators and Disney keep piling up. They were impossible for us to ignore. Last week in a Wall Street Journal profile, top UTA talent agent Allie Berman explained creator businesses like this. Think of it as Disney, but Mickey Mouse is the director, producer, and distributor in addition to being the star. So this is not the first time that we've heard this. In October, Stephen Bartlett, who hosts Diary of a CEO, tweeted that he was going to build the next Disney when announcing that he had scored an eight-figure investment round for his company, Stephen.com.

1:16Jasmine Enberg: And Dude Perfect also used this comparison recently in a Business Insider article about hiring its first-ever chief content officer. And then there's Mr. Beast, who also reportedly used this line when he was pitching to raise money for his holding company. And Dar Mann's business has also been likened to Disney, at least in an article that I saw from Wired not too long ago. So, I mean, the comparisons just don't stop. I mean, obviously, it makes for a good headline, right? And it's also an easy, familiar way for creators to describe their ambitions, especially when they're talking to investors or reporters who often come from the traditional world and may not understand creator businesses, but definitely know Disney.

1:53And to that point, a lot of these comparisons have happened when creators are either trying to raise funding or when they're bringing on an executive, which is something that we're seeing happen more and more these days. And actually, in today's newsletter, we mapped out a recent timeline of notable hires and went more in depth about why these executives, who also often come from the traditional media world, are actually now joining creator companies. But the problem is, is that creator businesses are inherently different than Disney's. And the comparison could have consequences when their efforts fall short.

2:24Because while creators are busy trying to make their businesses fit into these traditional models and structures, what we're also seeing is that incumbents like Disney are getting smarter and subsequently could get stronger.

2:39Jasmine Enberg: So we wanted to break this down a little bit for our viewers and listeners who also definitely know Disney, but may not be as familiar with the intricacies of Disney's business. So it obviously is a media entertainment empire. It has an enterprise value of about$183 billion. And the Walt Disney Company also includes ESPN and its streaming service, Disney Plus and Hulu. And it's also the second largest TV distributor in the U.S. after YouTube, according to data from Nielsen Gage. Disney has also been the number one in the global box office for nine years in a row. And it also extends far beyond just movies and TV and far beyond the U.S.

3:15Jasmine Enberg: So if you look at its theme parks, for example, we know and love Disney in Orlando and California. And just in California, Disney has brought in over 900 million visitors since it opened in 1955 and more than 17 million people in 2024 alone, according to the Themed Entertainment Association. So that's roughly, shout out to Jasmine's home country, that's roughly three times the population of Finland. And a lot of the visitors in the U.S. are coming from other parts of the world. And Disney parks have also expanded to other parts of the world. So, of course, there's the theme parks in Florida. But we also have Paris, Tokyo, Shanghai.

3:50Jasmine Enberg: So you can just see kind of the diversity of the business. Yeah, I mean, Disney's business is often described as a flywheel, where its content, meaning its TV shows and its movies that are all based on its original IP, lift engagement, as well as spending in other parts of its business, meaning its streaming services like Disney +, also merchandise and other physical products. and those theme parks, Kaya, that you just mentioned. And one really good example of this in action is Zootopia 2, which I saw and loved, and I normally don't like cartoons or animated films, but it was the highest grossing animated Hollywood film ever.

4:23It did really well in China, where the company has since said that Zootopia Land is now a key driver of attendance to its local park there. Disney also said that the success of Zootopia 2 is boosting viewership of related content on Disney +, and also driving more sales of its products really around the world. I think what is most interesting about Disney's business, and of course people in the industry know this, but maybe the average consumer doesn't, is that Disney now makes most of its money from theme parks and its other experiences instead of from content. So if you think back to the first quarter of this year, 71 % of Disney's operating income came from its experiences division, which includes theme parks, cruise ships, and other products.

5:04That is a whopping figure. And of course, it wasn't always the case, but Disney has been investing really heavily in experiences and clearly those efforts are paying off.

5:13Jasmine Enberg: Okay, I want to see Zootopia now. I mean, I knew it was big, but I didn't know it was that big. But it's that flywheel concept that creators are trying to emulate by launching products, their own experiences, and even infrastructure to distribute shows. We've seen theme parks from some creators as well. But obviously, all of these creators are operating at a much, much smaller scale than Disney. I mean, if you look at Beast Industries, which is Mr. Beast's holding company, arguably, I think that's the highest valued creator company at about$5 billion. And that's by private investors as well. But the similarities are undeniable.

5:47Jasmine Enberg: I mean, if you look at Dude Perfect, again, example, Theme Park, they're opening one in Dallas this year. Dude Perfect started as a YouTube channel run by five college roommates. And now since then, they've launched their own streaming service. They just hired their first chief content officer, and that follows hiring their first CEO, Andrew Yaffe, who's a former NBA executive, and that was in October 2024. And this new chief content officer is going to be responsible for developing new shows and formats and talent to help expand kind of beyond the trick shots and sports content that Dude Perfect is known for.

6:19Jasmine Enberg: And if you look at Mr. Beast's business, right, it spans so much. Of course, there's his chocolate brand, Feastables. He opened, again, theme parks at Temporary Theme Park in Riyadh. He actually also has a real estate portfolio in North Carolina that I think a lot of people are not aware of where he lives. I didn't know that. Yeah, he does. This all came out as part of the lawsuit over Mr. Beastburgers. There was a lot of really interesting insight from that lawsuit about his business, which includes real estate. And he also has ambitions beyond, you know, content into mobile phones, into financial services.

6:52Jasmine Enberg: He recently acquired a teen banking and fintech startup. And same thing for podcasters. I mean, we've seen Stephen Bartlett, who is best known for Diary of a CEO, but he also has a media and investment company called Flight Story and a fund as well that's backing startups and in some cases other creators like Maggie Sellers, Hot Smart Rich. The other business that Stephen Bartlett has to add to this long list is a video podcast hosting company called Flight Cast. So it's so interesting to see how much how much they've evolved. Yeah. And they really are, you know, following Disney's playbook as they're doing so.

7:25I think one problem that a lot of people have also pointed out is that Disney's empire is built on original, timeless characters and universes. Thinking about Mickey and Friends, for example, all the way to Disney Princesses, which is my favorite, to Star Wars and Frozen, which I actually didn't know was its own franchise until recently. Creator businesses, on the other hand, they center around an individual or sometimes several individuals, like in the case of Dude Perfect. but regardless, they're really based on a real person in the real world. And there is only so far you can scale an individual.

7:59I mean, we hear this time and time again in our conversations with creators. It's also one reason we see them bringing on executives into their businesses. And that isn't to say that these businesses aren't successful. I mean, of course, we're seeing, you know, creator content being watched on TV screens the way we do regular TV now. You know, they're also being watched during primetime TV viewing hours. They're really, you know, posing a threat to the traditional media landscape. But creator content really is much more reality show or talk show than it is Magic Kingdom. It is so much harder to make a reality show a timeless, universal classic and build an immersive world around, you know, a creator content than a scripted piece of original narrative.

8:42There's a reason why we've never seen an Oprah Winfrey or Martha Stewart themed theme park, for example.

8:48Jasmine Enberg: Well, you know that you and I would be the first in line to the Martha Stewart theme park. A hundred percent. And I would be a repeat visitor. A hundred percent. But I don't know how big that market is as much as we love Martha. I would argue that the Kardashians have proven they are pretty timeless. So there is a lot of them, which I think helps keep them kind of in the discourse. But it is a very different kind of business empire that they've built. And it's increasingly centered on physical goods these days. Skims, which is Kim Kardashian's shapewear brand, was last valued at$5 billion by private investors, which is on par with Mr.

9:25Jasmine Enberg: Beast's holding company as well. Yeah. And I think the one thing or one of the many things that the Kardashians have done right is as they've been launching these physical products, like, yes, they are the face of these brands, but they're also kind of one step removed. I mean, Skims isn't called Kim Kardashian's shapewear brand, right? Or then you have Good American from Khloe Kardashian, her fashion, primarily jean brand or poosh, right, which is from Kourtney Kardashian. And so, you know, they are obviously very connected to them. Many of them are the face of those brands, but they built it in a way that the brand can go on without them.

10:00Jasmine Enberg: And they're also not the CEOs of these brands. They've brought in seasoned executives to run them. But I think that's sort of the goal is they're leveraging their initial influence. Like Kim was in all the early Skims campaigns, and then she started bringing in kind of other faces. But anyway, to go back, I think it is hard to build a business that lasts kind of around one person. I think that's often dubbed in this industry as key person risk, right? Or the challenges of having a business be too dependent on a single individual. And I think the Kardashians are a perfect case study. Like if you think about kind of how their businesses have evolved over the years, it's been less and less about them, but still leveraging kind of their universe.

10:36Jasmine Enberg: And I think like, yes, look, people feel like they know creators. They have these parasocial relationships with them. I think that's what that's a huge reason why creator content works really well. But there's always the question of what happens when that creator steps away. I mean, so many big creators now are thinking about how they can exit and even for the Kardashians, right? Like Skims is a potential exit for her. I mean, I don't think they want to be in the spotlight forever. Who knows? But I think this is a big question in the creator economy. Maybe. But at some point, I mean, I don't know.

11:05Maybe I want to break. I mean, look at Kris Jenner. She's still going strong.

11:08Jasmine Enberg: I know. It's true. It's true. Okay. Scratch that then. And maybe they'll be here forever. But it gives them at least an exit where they don't have to keep hustling forever in the same way. But I think that's a big question, right? So many creators kind of get into this business accidentally, and then they don't start thinking of this as a business. They start from a passion project and posting. So what happens to these businesses when the creators are no longer the star of it? I mean, you can't just kind of swap in another person overnight. Although it is worth saying that there is quite a bit of these roll-up companies that have been doing this, right?

11:38Jasmine Enberg: Electrify Video Partners in London and Lunar X. They take majority stakes in YouTube channels, and the hosts either stay on or are slowly replaced. But often these are like science-focused channels or channels that are more around the content and aren't as centered around an individual. So anyway, lots to unpack there, but it is a really, really interesting question. Yeah, I mean, obviously there are examples of this working successfully, but I think it's closer to the exception than the norm, right? And I think a big part of that is something that you just brought up, which is, you know, the emotional connection that you have to creators, right?

12:09And everybody has an emotional connection to Disney. And I'd argue that that is much stronger. I mean, I think it's universal. Everybody has a memory about Disney in one form or another. I mean, I remember flying from London to LA when I was about nine years old and getting to go on Space Mountain. I think we went like three times in a row because my sisters and I all loved it. And then last year, I got to go and bring my nephew to Disney for the first time here in California. And it was just such an amazing experience to kind of see the joy on his face when he met the Marvel characters. I mean, Spider-Man and Thor, who he's totally obsessed with.

12:42And that just continues generation after generation. And you build new memories on top of that. It's hard to imagine that, you know, being replicated for a lot of the big creators that

12:51Jasmine Enberg: are out there. And it's harder. I mean, it's not impossible to cancel a brand, but it's much easier for a creator to get in hot water than for a brand to completely light itself on fire. But Disney really does have something for everyone. I mean, I also have childhood memories of traveling to Disney World in Orlando because I grew up on the East Coast, including, which reminded me, I remember like vividly getting pulled into the middle of a restaurant to like belly dance with Princess Jasmine, which maybe was not the most appropriate for a nine-year-old. But I don't think they're still doing that.

13:23Jasmine Enberg: I mean, yeah, this is the 90s. But still, I mean, you have these, everyone I feel like in the US has Disney memories. And the other problem, and this relates more to the infrastructure side of things, meaning how content is produced and distributed is that we're now in an entirely different media landscape than we were even just five years ago and radically different from when Disney first started building its flywheel. There is no dominant medium anymore like there was with TV. We really are all over the place with how and where we're consuming media and entertainment. And that to me says we're probably not going to have a dominant media and entertainment brand anymore like we have had for a long time with Disney.

14:03Jasmine Enberg: Yeah, I mean, it's so splintered and personalized. I mean, what shows up on my feed, you know, isn't what's going to show up on my sister's feed or your feed, although sometimes it is because we do have similar interests. But like the monoculture has really disappeared. And people are, you know, with the exception of some, you know, moments like with the White Lotus, and it feels like everyone's kind of tuning in at the same time, like, people are just not generally watching, you know, the same movies and TV shows anymore. And I mean, if you think about all the streaming services that you have to have logins to, right, like, if there's a phenomenon on Hulu, like, you just might not be part of it because you don't want to pay for like the 18th streaming service.

14:36Jasmine Enberg: Or you may not, you may just be watching like highlights or commentary videos on social media instead. So it is like just such a hyper niche. It's a totally different landscape now. Yeah. And everything is moving so quickly. So even when we do have those moments, you know, that are universal, like with White Lotus, like we move on pretty quickly. Right. And so it doesn't last the same way that, you know, Disney has lost it throughout generations. And I do think, obviously we are also in this era where traditional media is clearly on the decline and creators and social media are growing and I think that is a huge part of what gives these creators and the executives who support them the confidence to say that they can be the next big media and entertainment brand or the next Disney but again you know the problem is that unlike Disney creators are still almost entirely reliant on algorithmically driven social platforms to publish their content like yes some of them now have Netflix deals Dhar Mann and others are operating studios and Markiplier, of course, had a big box office hit, but their core platforms and their core audiences really are on YouTube.

15:35They're on TikTok and they are subject to the whims and the changes of those platforms, which aren't always in the best interest of creators.

15:43Jasmine Enberg: And these platforms are more crowded than ever. Like if you think about the rise of TikTok, like TikTok was minting new mega stars. Like if you think about the Charli D 'Amelio and the Sway House Boys era, like overnight, there were bigger and bigger stars breaking through. And we might not see that again as we've moved to kind of these more niche algorithm driven feeds, which makes building loyalty really hard. I mean, these platforms are more crowded than ever. I mean, I was thinking like probably Alex Earl is the last creator to really break through to the mainstream. And that was 2023. So this is like almost three years of that happening.

16:19Jasmine Enberg: The point being is that it's hard to imagine a single creator having as big and universal of an audience as Disney does in this really splintered and fragmented media landscape. Yeah, and I worry about the ramifications of trying to force an existing business model onto a new industry like the creator economy that is new and different, right? And I mean, we've seen this happen before, including in this industry with influencer marketing. We are still years down the line trying to force old structures and measurement frameworks onto the tactic and they're not working. Like we all know that you cannot measure a creator partnership the same way that you do a search ad.

16:55And even as spending has risen dramatically, that is really holding a lot of marketers back. I mean, whenever I talk to brands, the number one reason they give me about why they're not investing more in influencer marketing is because of measurement issues. And because they're facing so much pressure from the C-suite to compare their influencer marketing investments to other types of digital media, whether that's social ads or search ads or whatever else. And in the meantime, new competitors are cropping up and we're seeing a lot of advertisers already starting to shift speed. Like the creator economy is not the hot new thing in marketing anymore.

17:29And that has both pros and cons. But we know that it's now AI and advertisers are already starting to spend more of their energy and ultimately more of their spending there. At the same time, we're also seeing the incumbents, meaning the big social platforms just get smarter. They're all pushing creator ads. And according to a report that we covered recently from the IAB, brands are now spending more on paid media amplification of creator content than they are on creators themselves. So that money is going to the platforms versus the creators who are developing the content. And we're already seeing some of these similar dynamics start to play out in the media and entertainment landscape.

18:07Like even Disney has adapted to this new reality. It aired an entire movie, High School Musical, on TikTok and 52 videos, recognizing that that's how people are consuming media these days. It also entered this landmark deal with OpenAI to license its characters so that people could create their own content using these famous Disney characters. And it also released a short video feed on Disney+. So as it's doing all of this, it's going to be harder and harder for these creators to compete because it is a juggernaut. And in the meantime, we're going to see new challengers rise for creator companies as well.

18:42Jasmine Enberg: All right, let's move on to our next story for today. The era of the influencer brand trip is over. It has been replaced by in-person events. Just in the past week, we've seen Spotify host a Galentine's Day party for female podcasters where they made custom jewelry and got cute Polaroid photographs taken. Substack, meanwhile, put on a spelling bee event emceed by Kazzy David, which featured celebrities and other newsletter writers. And it's not just the tech platforms. Ocean Spray invited a group of creators to a bog harvest last fall outside of Boston, which was extremely popular. These types of events have a lot less baggage than influencer trips, which have gotten such a bad rap.

19:24Jasmine Enberg: But these events still provide many of the same benefits that the trips did. Yeah, we were actually invited to the Spotify Galentine's Day party, and I was so bummed to have missed it. It sounded like a lot of fun. But I mean, yeah, you're right. I mean, these trips have gotten a really bad rap over the years. But for a long time for an influencer, going on a trip with a brand was such a big flex, right? And yeah, for brands, yeah. And for brands, it was a really effective way to build loyalty with creators, get a bunch of content, generate a ton of attention and at a relatively low cost. It is cheaper and easier to fly a bunch of influencers out to a cool exotic place where you know that they're going to make a bunch of content for you that features your brand instead of negotiating individual long-term deals with all of these influencers.

20:09And so just a couple of examples of this and this one, I obviously remember because it has to do with Finland, but Kiehl's a skincare brand sent a bunch of influencers to the north of Finland. We had Revolve and Tarte who famously organized trips in Dubai and Bora Bora. And I do think that for a long time, people were mostly on board with these trips. It was still, you know, the time of the millennial aspirational influencer. Or, you know, if they didn't like them, at least they weren't being very vocal about it.

20:35Jasmine Enberg: Yes. But over time, these trips got more and more extravagant. They did. They started rubbing people the wrong way. I think Tart and Revolve were sort of the poster tiles for this. I mean, they started getting criticized for lack of diversity and also for feeling out of touch for the average consumer. And the drama really started spilling into the public conversation from the creators themselves. Some Black women who are on the trips complained of getting worse rooms or receiving different treatment. So all of this kind of contributed to this perfect storm. And then Sheen happened. Sheen in 2023, if you remember, flew U.S.

21:08Jasmine Enberg: influencers to China on an all-expenses-paid trip, which included a factory tour. And the hope was to improve Sheen's image, but it spectacularly backfired. The influencers did their part, saying, you know, they did the good PR that Sheen wanted. They praised the working conditions in TikTok and Instagram videos. One creator went viral for saying, quote, workers weren't even sweating. Sheen was, needless to say, completely blasted for this by the media, civil rights group, customers. I was looking back at some of the articles and the videos have been taken down by the creators. So that really was the beginning of the end for these trips.

21:44Jasmine Enberg: Yeah, whoever thought that was a good idea? I mean, come on, because it was it was such a huge scandal. And it also revived other concerns about shame's business practices, like its environmental impact and the ethics of overconsumption. Because if you remember, this was in 2023. It was the era of de-influencing. And that, of course, was prompted by this massive economic uncertainty that a lot of people were dealing with at the time. And basically, creators were using social media to tell people what not to buy, how to spend less, how to consume less. And I think on the one hand, and, you know, Kaya, you and I have talked about this before, this showed how creators are really good at adapting.

22:21I mean, de-influencing is still influencing after all. But it also made these, like, really lavish, extravagant trips seem super tone deaf when people were struggling to make ends meet.

22:31Jasmine Enberg: A hundred percent. I mean, also, they didn't totally stop after that, which is baffling. I mean, the Kiel's trip to Finland was 2024, but it did make brands think twice. And I think they also realized that they had far less control over the content creators posted from these trips. than they would in a more traditional brand deal. And no brand wants to be caught up in the media frenzy that was Shein. And I think as with other formats, I mean, it just gets old. Like, how many times can you watch influencers get, you know, jetted off onto these amazing trips? Like, brands had to come up with something different.

23:02Jasmine Enberg: So if you fast forward to the end of 2024, early 2025, we really saw in-person events come back in a big way. I mean, I think a lot of brands have been thinking about how to show up physically, whether it's at conferences or smaller events or host dinners or just kind of get better involved with our customers and social media audiences in the real world. Yeah, I mean, we were out of the pandemic, people had been cooped up at home, and they were craving real IRL experiences. This was the time when you saw people start going back to shopping malls, including Gen Z, right? And they were going to festivals, they were going to concerts, shout out to Taylor Swift, that's when she was on her heiress tour.

23:36And to my great dismay, people were also going to run clubs.

23:39Jasmine Enberg: I will say to save my thoughts about run clubs for another time. You will never catch me at a run club. Never. No, never, never, never. But people loved them and still do. And, you know, again, so this was like examples of how people were really getting back out into the real world. And you even saw social platforms trying to figure out ways to connect people in their local communities. Like you had Facebook, Instagram, TikTok, all launch local feeds for that purpose. The difference was, of course, is that people wanted their offline experiences to really reflect what was happening in their online worlds.

24:10Because one thing that didn't change after the pandemic was that people were spending record amounts of time on social media. They were also spending record amounts of money shopping on e-commerce sites. And I think, you know, that's where creators come in. They are a huge part of our online world. They were also, you know, starting to go on tours. Some podcasters were selling out stadiums. And I think a lot of brands just really had this aha moment where they were like, we can host our own event, invite creators, also invite regular people. We'll still get good content. We'll build loyalty with creators and we won't alienate anybody by excluding them.

24:47Instead, we'll bring everybody together into our world in a more controlled space. And sometimes at an event that they would have been doing anyway, right? So if you think about Heels, for example, now what they've done is they've entered a partnership with Jackson Hole to be their official skincare partner. And they bring creators and influencers there for weekends where they can create content and, you know, kind of enjoy the resort. It's like a low lift influencer

25:12Jasmine Enberg: trip. Exactly. And it's easier to scale. Exactly. And we've seen this on full display at a lot of the conferences we've been to in the past year. South by Southwest, which kicks off this week, is no exception. Last year, for example, one of the buzziest events was by Gordons, which took over one of the buildings on Rainy Street. I missed it and had FOMO because everyone was talking about it. But candidly, I was like, wait, why would I go to an activation from a hundred year old seafood brand? Like we're at a tech and arts conference. But here we are. It was like the hottest activation of the show.

25:43It really was. I mean, the line was around the block and I got to go and I actually got a tour of the whole space, which was amazing. And a big reason why it was so buzzy, though, is because they invited creators either to come visit or to take part in their programming. So they had a cookout there, they had music, they had like demos and all of that kind of demos. Demos of what? Like fruit? I'm cooking demos. Yeah. Okay. No, no, it was amazing. I'm like fascinated. Well, maybe they'll do it again this year and we can go. But I mean, I think a lot of it was because there's creators who were there.

26:15I mean, they were posting content onto social media, some of it in real time. And a lot of the creators that they invited were actually local to Austin. The food influencer Jane Coe is a really good example. I just missed her, which I was really bummed about because she was actually the first creator I ever spoke to when I started covering the creator economy. So I was dying to meet her in person, but she posted about it. And again, so did a lot of others. And I think that helped bring in these crowds. I think that actually speaks to another benefit for brands here because you can invite local creators and that eliminates some of the costs associated with those big influencer trips in places like Bora Bora or Dubai, right?

26:49Jasmine Enberg: Okay, so speaking of South By, let's talk a little bit about what we're expecting this year. It kicks off on Thursday, and like nearly every tech conference, it's become so much more creator-focused in recent years. The one exception, I have to say, is Mobile World Congress in Barcelona. I was there last week. It was my first time. It is one of the largest tech conferences in the world. It attracts more than 100 ,000 attendees every year. It reminded me a little bit of CES in Las Vegas. In my past life, I did cover gadgets and consumer tech for CNN, so I spent many times at CES before it became kind of a creator destination.

27:20Jasmine Enberg: Mobile World Congress is very technical. I mean, there were so many robots, wearable devices really in the weeds on AI, but no creator track, no panels or activations related to creators. I mean, Google and other companies were there, but it was all about AI. There were creators there, though, but they were primarily tech-focused creators, which I thought was so interesting, like creators who post about AI, whereas I think like CES and Web Summit and these other conferences have attracted more general creators. I mean, Logan Paul was in Doha earlier this year and Max Klemento from the Career Ladder series.

27:49Jasmine Enberg: So they're not tech-focused at all. So notable attendees, though, at Mobile World Congress were representatives from Mr. Beast, including his CEO, Jeff Hausenbold. Jimmy Donaldson was not there personally. But at first I was like, hmm, what are they doing here? There's no creator presence. But given their recent acquisition of a fintech startup, you know, their ambitions to launch a mobile phone company, plus the recent Salesforce Super Bowl ad, it does make a lot of sense that they wanted to be among all the techies. Yeah, I was so surprised to hear that Mobile World Congress barely had any creator presence.

28:20It is one of the oldest and biggest tech conferences.

28:23Jasmine Enberg: And you'd think at this point that they would have had creators there. I mean, I hope you gave them some feedback about that. I should. I should. But anyway, back to South By. The conference has a special meaning to us because the idea for Scalable actually really started there a year ago, which is crazy to think about. But Jasmine and I did a solo presentation together, breaking down the biggest stories in the creator economy. We put up a bunch of charts. And people really liked it. And they told us that it sounded like a podcast. They said we should create a show and take it on the road. And here we are.

28:53Flash forward a year later, and we'll actually be recording a live podcast at South By as part of the podcast movement. So we're really excited to be on stage with Jordan Newman, who's an executive at Spotify, as well as Sherry and Jean Liu from the Tiger Sisters podcast.

29:05Jasmine Enberg: So like us, they've come from business backgrounds, and they've built a top business podcast over the past few years. So very excited to talk more with them. That is on Friday night. And over the weekend, I'm excited to moderate two panels, one on why creators are flocking to podcasting with Vox Media, YouTube, and a podcaster. And I have another session with OG YouTubers Rhett and Link and Agentio CEO Arthur Leopold about next generation creator brand partnerships. Yeah, and you can find me on stage with Beehive CEO Tyler Dank. We'll be talking about the future of the newsletter industry and how to turn small audiences into big businesses.

29:39I'll also be moderating another panel on Friday night about creators on the red carpet. I'll be joined by Julian Barnum Shapiro from Recess Therapy, who also is about to launch a variety show on YouTube, as well as executives from Doing Things Media and the Dick Clark Productions. So super excited for that. It is going to be a very, very busy weekend for the two of us.

30:00Jasmine Enberg: Very busy. But enough about us. South By has changed a lot over the years. This is the third year it will have an official creator track. And I actually think this year will feel quite different. I caught up with the organizers ahead of the event. First of all, big change, no Austin Convention Center because it has been torn down and they're rebuilding it. So the Austin Convention Center has been the anchor of the event since 1993. So this means that the organizers had to get creative and are spreading out across hotels in the city. I mean, that already happened to an extent. I mean, I did panels that were official South By panels at different hotels in the area.

30:34Jasmine Enberg: Another big change, South By is happening across just seven days this year. Normally it overlaps with two weekends. And they're bringing together all the events in the same time frame. So it used to be that, you know, the music side and the film side and the tech side were all kind of separate. And a big part of the reason that they're combining this is because of so much overlap. And a lot of it is driven by the creator economy touching everything. So I remember, you know, one year I went for more of the tech portion, but at the end of the week, Meta was hosting, you know, an event with creators and entertainment companies and all this stuff.

31:05Jasmine Enberg: So you would miss out. So I think that the organizers recognize that. And basically what they're doing is they're creating these like clubhouses themed around film and TV, music and innovation. And they're organizing panels and events to kind of make it easier logistically for folks to attend similar sessions and also be able to be there kind of for the full events that they want to be there. So I think it'll definitely feel different this year. And also it'll be much more embedded kind of in the city of Austin. I do think like convention centers have their pluses, but it kind of, you know, it's not super charming to be at a massive convention center.

31:33Jasmine Enberg: So I'm curious kind of what it'll feel like. But what are you most excited about this year at South Bay? Yeah, I mean, I think, honestly, the same as for any conference, right? I mean, there's such a good way to get a pulse on what people are thinking. I mean, both in terms of, you know, the panels and what people are talking about on stage, although people tend to be more guarded when they're in front of an audience, but especially in sort of the impromptu conversations, as well as the meetings that you have while you're there. I mean, it's such a when you're all in the same place, it's so much easier to be able to get meetings with people who you might not normally be able to speak to.

32:04And then, of course, the Vox Media Party. I missed it last year. I know, Kaia, you got to go and I had so much FOMO. So I'm excited to be able to go this year. And I even changed my flight so I can be there Sunday night.

32:15Jasmine Enberg: So I am dedicated to this. Yeah, the Vox Media Party, it was like I was like, oh, my God, Andy Roddick's there. And I'm a big tennis fan. And he was a podcast with Vox. There were CMOs there. there were, you know, familiar faces. So it was a great event. Yeah, I agree. It comes down to the people for me. It's always so efficient to be able to like meet with people, run into people, you get so many ideas. I think too, just like outside of the conference, I'm really excited for some good barbecue and tacos. I also if I have time, I try to pop into Alan's Boots, which is an iconic cowboy and hat store.

32:46Jasmine Enberg: And I found some gems there, including very fun cowboy boots that are metallic. And last year, we bought the same jacket with stars on it. So now we have to coordinate to not wear it at the same time. But so if I have time, we definitely are eating some barbecue, Jasmine. And we're definitely going to Alan's Boots. I loved it. Last year, you gave me the recommendation and I went and I have been back since. So I definitely want to go. And also, I mean, just in general, I'm excited about outfits. Like we've already been texting and trying to coordinate what we're wearing so that it's not exactly the same, but still sort of like in a similar vein.

33:17And last year, I don't know if I told you this story, but I sourced a pair of cowboy boots from Facebook Marketplace in Finland, which was such an adventure showing up to this guy's workplace in his office to pick up his wife's cowboy boots that had never been worn. And I tried them on there. Don't have to do that this year. But it is so fun to be putting putting outfits together to wear. You secure the boots. Yes, exactly. Okay, well, next up is our conversation with Donut Media. For those of you who aren't familiar, Donut is an automotive media company with more than 9 million YouTube subscribers.

33:50Unlike most creator companies, Donut actually started as a business first, making ads for car brands. They found success on Facebook, of all places, with a show that they created and then started building out their YouTube channel, eventually launching multiple lines of business from merchandise to podcasts to live events. So we talked to Max Maddox, who's the head of creative, and Nolan Sykes, who's the editor-in-chief of Donut, about their journey and what it actually takes to build a business in the creator economy these days.

34:18Jasmine Enberg: Hi, Max and Nolan. Welcome to Scalable. Hello. Thanks for having us. Thanks for being here. So take us back to the beginning. How did Donut start? Oh, man. Okay. So 2015 is when the company was formed. This was before either of our times. But it started out as more like an ad house. So, you know, we'd get contracts from companies, mostly automotive, like Gumout or Nissan, NOS Energy. And we would make commercials that would live on their social channels usually. This was when everybody wanted a viral video, like as a form of marketing in that like 2015. It was before like YouTube became a really big platform where it was creator driven.

34:57It was very much like companies trying to make cool viral things happen. We were fully invested in that. But at the time, our CEO, Matt Levin, recognized that there would be a bit of a shift from like a company driven to creator driven kind of scene or ecosystem on YouTube. In 2017, we started experimenting with like YouTube donut brand exclusive videos on the channel. We tried vlogs at first, and then we started doing a weekly show called Up to Speed. That first video on the Nissan GTR, I mean, it was a big success on Facebook especially, and then started giving some momentum to our YouTube channel.

35:37And it's like, okay, let's do this every week now. And then we started adding other shows into the rotation. and weekly cadence for all of our uploads and having multiple shows was something that not a lot of other channels could do just by virtue of Donut being a media company with a staff of around 10 people at that time. And our momentum was just insane. And that's how we really grew. And at that time too, I think a big ref for us was like what Vox was doing, what Bon Appetit were doing. The idea was to be like the car YouTube channel. at a time when there really wasn't a definitive car brand on the internet.

36:16I think a lot of legacy automotive brands like Motor Trend and to some extent, like some of the TV shows that you'd see, that was kind of like the mainstay for car media. And we were a bit of a response to that. Was there a moment where you felt like you had made it? I remember fast forwarding a bit when 2020 with COVID and the quarantine happening, you know, we didn't actually miss a week of uploads there. We like we're able to order equipment so we could shoot all the videos at home and then send them to send the footage to editors and stuff and keep the cadence going. But, you know, we were then working from home, shooting from home, not going to a lot of car meets or any sort of events like that.

36:54And then coming out of covid and, you know, when things are starting to open up again, our channel in that time over that year from 2020 to 2021, we had doubled in size, I think, from two million to four million subscribers. And I remember distinctly feeling like I feel like more way more people are like I'm getting recognized way more. And like I'm seeing more donut merchandise out in the wild, more bumper stickers. And we were just a lot more famous. It was it was a weird feeling. You also just got signed by CAA in September, right? Like that is another sign of real legitimacy. One of the things that you brought up there is that you are posting videos weekly.

37:32Tell us a little bit more about that, because I think, you know, keeping on going and staying consistent in this business is a challenge that a lot of creators and media companies have. I know we think about that all the time, too. How what is your strategy there? A big part of that is just having a team structure. And unlike a lot of other YouTube creators, which start as creators and then they turn themselves into a business, Donut was always a business first. And so we had the infrastructure to say, like, OK, we've got we've got a creative director and then there's showrunners and then there's hosts.

38:00And having the hosts have a lot of ownership about the type of content that they're in is also a big part of it. You know, especially when, you know, 2018, 2019 or so, when we were really just building the momentum of our channel, the hosts were very much writing and conceptualizing and pitching and doing like all the work on their shows. So like Nolan, for example, was writing like crazy and he was hosting and it was just a lot of busyness. But there were a lot of people who were able to contribute to the whole process. Yeah, I definitely have a lot of sympathy for, you know, the creators out there that are still writing, shooting themselves, you know, editing themselves, uploading themselves like that.

38:38I don't think I could do that.

38:39Jasmine Enberg: Well, disclosure, we are also signed by CA. So we're like cousins, right? There you go. But there are obviously so many options now to build a business via social media, right? Your business has expanded, you know, to live events, merchandise, podcasts, like you mentioned, so many things. So how do you make decisions about what to launch and what makes sense? For me, like how I think of it is like, how do we marry our interests and our desires for what we want to create with what we think our audience will like? You know, there's definitely been times where we've forgotten a little bit about the audience and seen the performance reflected in that when it comes time to release.

39:18You know, it's like, oh, you know what? That was really more for us. It didn't really hit that mark with our audience. And something that you got to like remind yourself over and over again as a creator is like, who is your audience? Like, who are you making your videos for? And how do you make them happy? Obviously, you want to get more fans. You want to attract more viewers to the channel. So finding that balance between what your core audience is into and what, you know, the audience at large might want to see as well is it's always a challenge. Every week it's a challenge. You know, we've been doing this for 10 years now.

39:50So there's just like, as Nolan said, we have a lot of information about what our audience likes and what they don't like. And we don't want to do something that's going to feel inauthentic to the brand. So like a good example would be, we did a really big deal with Zoomies to get our merchandise in their stores. And we thought that was super cool because Zoomies represents sort of a younger fan base, kind of like our audience. And it was just like pretty cool. And the designs of our merch really fit in with the store. So that was something that we were like really thrilled about. And it's been awesome too, because we'll see people wearing our shirts who maybe they don't even know who Donut is, but they see the designs on the merchandise and they think it's cool.

40:21Like, for example, there was, I think it was, was it a curler, Nolan? Do you remember this? There was a guy who's a professional curler who wore one of our hats. Yeah, that was a couple of years ago that this Italian curling athlete wore one of our hats because he saw it in a store and wore it during our competition. I don't think it was during the Olympics. I don't think they're allowed to do that, but it was during like a high level curling competition. That was pretty, pretty funny. Like it blew up on our Reddit and people were tagging us in all the pictures of the guy wearing the hat. So super cool.

40:50Yeah, I think that's just like number one priority for us is like don't make decisions that don't best represent our interests and our audiences. Like sometimes opportunities will come in and you know in your heart, you're like, dang, that would be so cool to fly out to that place and do that opportunity. But you can't really thread the needle on like what the audience would think of it or like how it would benefit the audience. And we've said no to a lot of like cool opportunities because it just didn't really gel with the brand overall or like what we think our audience would like, even though it would be, you know, a cool opportunity to go travel to someplace, take a little mini vacation.

41:30We've said no plenty of times. And we've had some really cool opportunities come up that we were like hell yes to. Like, for example, besides the Zoomies thing, we have a Samsung TV fast channel right now. So on all Samsung TV, you can see Donut as like a 24-7 stream. Live events, too, has been a huge thing that we've been leading into recently. First, you know, we've done some smaller cars and coffees and we've done events at the Peterson Museum in Los Angeles where we've completely sold out both of the top decks of the parking garage. It's just like an incredible opportunity to get our audience in person and meet them.

41:58And that for me is, you know, back to like the moment when we made it is like seeing all the fans in one place and seeing just like the passion from these people in the real world is like crazy to see. We had an event, a signing at a Zumi store in like the South Bay area. And that was the first time I like we were legitimately mobbed. It was after the event. We had gone back to our cars in the parking garage and there had been a bunch of fans that hadn't been able to get into the store for the signing. and we were like surrounded and spent another hour and a half or so signing people's merchandise or taking pictures.

42:34I will change my answer to the when did you guys know you got big? That that's my answer right there. That was that was crazy. That was crazy.

42:41Jasmine Enberg: To go back to what you said about, you know, your Samsung TV fast channel. I mean, now Instagram has a TV app. Like, it feels like we're in this moment where, you know, social media, streaming TV, it's all kind of coming together. So how do you see that and how do you think about, you know, TV screens? Obviously, YouTube is big on the living room, but where do you see all that going? I mean, for us right now, TV has been a really big investment in terms of our long form. We've been seeing that number of TV viewership rising, and it's actually the majority of all of our watch time on YouTube happens on smart TVs.

43:11So a big strategy there is just making slightly longer content that people are watching at home. And we're seeing sort of this shift from, I think, during like the COVID era, people were watching like everything we uploaded on their computers because they were all working from home and kind of post-COVID it switched to phones. People were more interested in like, you know, they're just kind of like on their mobile devices. And now YouTube, I think just because the quality has gone up and people have a lot more trust for YouTube creators in general is I believe the number one streaming platform above Netflix now.

43:39And so, yeah, we're definitely taking advantage of that because I think we're able to make pretty high quality content that people do enjoy watching on TV for longer periods of time. Yeah. And I think there's a balance when it's on YouTube specifically for the TV watch time, like the length of the videos and stuff. I'm sure you guys can probably relate, but you'll be on YouTube and scrolling through and seeing like a 25 or 30 minute video for a topic that you're into. But maybe you know enough about the topic to be like, I don't see how you're going to make an interesting 30 minute video on this topic.

44:11You know, it's like respecting the audience's time, I think is still very much an important factor in creation. You know, I know, again, if I see a super long video, I'm like, I don't know if I have the time for that right now. It just depends on, I guess, when I'm viewing it. I'll indulge in a 45 minute YouTube video. But I still think like a 12 to 15 is really our sweet spot to be still dynamic, but deliver enough information where it feels like it was worth the audience's time. Oh, one thing that's interesting is we do have, I don't know how much specificity I can give, but we are going to be having some videos premiere in theaters in front of a live audience in the coming year, which is a new opportunity that we haven't really seen a lot of other creators do, but we're super stoked about that.

44:50We have a flagship series called Hi-Lo that we've been working on. This has been on the channel for several years. It's our number one performing series where we build two identical cars, one gets cheap parts and one gets expensive parts. And so we have a new season of Hi-Lo that we're shooting right now, and that will have a live premiere, which is something we've done a little bit of in the past, but not too heavy. So we're going to be leading into that a little bit more this year. It also feels like we're kind of going full circle, though, right? I mean, we went from TV screens to laptops to mobile phones and now back to TV screens.

45:19But, you know, one of the reasons the platforms are leaning so heavily into the living room screen is because they want to expand and diversify their audiences. Have you seen any evidence of that in your work or has it helped you to sort of diversify to maybe different age groups, demographic groups, that kind of thing? Generally speaking, 80 percent of our viewers are under 35. And that's that's still typical with TV. But I think with TV in general, it skews a little bit older. and we're hitting that audience where it's like maybe you got home from work and you want to just kind of sit back and put something on tv which is very interesting for us and another thing with tv i think speaking maybe not so much towards demographics is that we're seeing longer videos do get more watch time longer term on tv so we've made videos that are you know two three years old at this point and they've been getting views on a more consistent basis even still because the tv viewer is like you know maybe not so concerned about if something's just like one week old or a month old, like they're okay with watching something that's been on the platform for a little bit longer, which is very interesting.

46:19Jasmine Enberg: Well, let's talk a little bit about revenue. So to the extent that you can share kind of what is your revenue mix look like? Is it primarily brand partnerships? You know, YouTube AdSense? You know, if you wanted to give us your annual revenue, we'd be happy to hear it. But to the extent that you can kind of share what the business breakdown looks like. Well, I'm not privy to the hard numbers, but definitely partnerships and sponsors are a major source of revenue for us. Most of our videos do have sponsorships and our channel does have several official partners like Hankook Dynapro, for example, is our tire partner.

46:52And so they've been with us for a couple of years now. And so they're in our content a little bit more organically, as opposed to just like, you know, sometimes we'll do one-off sponsorships where there's a branded segment in the middle of the video. Hankook is a little bit more prevalent on the channel at large. And so that's something that we're very interested in is the official partnerships and just kind of growing relationships with brands for those sponsor segments. Certainly YouTube AdRev is a big part of it, but it's not quite as substantial as the sponsorships and partnerships. On the other side, definitely merch is something we're interested in growing and events too.

47:23While they don't represent the majority of our revenue right now, like that's a really big channel for us and a big area of growth that we're currently working on. So with all of these different content types, devices, channels, lines of business that you have, how do you measure success? Success is, you know, maybe not something where there's just like one number that we try to hit, but I think relatively for us, growth, seeing how videos perform relatively to videos that we've put out in the past, you know, obviously like our goal is to keep building and to get more views and to be able to create more videos and being able to see our audience in the real world and grow that brand beyond just like, you know, your phone screen or your TV screen would be a huge measure of success for us.

48:06Yeah. I also think more, more literal sense, like the viewer retention as well, seeing like more than 50 % retention at the end of a video is pretty good watermark, pretty high. And that's when you're like, okay, I made a good video. I did, I executed my job. Also view count, obviously, but you know, taking satisfaction from that, that retention there is, that's how, that's how we know we did a good job. So it's a mix of qualitative and quantitative. Definitely. like. Absolutely. Yeah. Cause like we're proud of, I mean, sometimes we'll make videos that don't perform as well as we'd like, but we're just like, so fundamentally proud of them that we're like, okay, we made a good video.

48:40We can be proud of it no matter what. But then on the other hand, it's like, you know, YouTube is a game in a lot of ways. And there's so much data that we can know like, okay, what's the click-through rate of this and how can we work on getting that up for the next video? How can we make the retention better so that people are sticking around longer? And so there's like, there's the meta of, you know, building a good, successful YouTube video. And then there's balancing it with something that we're very proud of. And that, you know, is, you know, I always go back to the word authenticity, but like that is authentic to us and that we feel is a positive video that we enjoy making.

49:07To be a little more specific, talking about that click through, like, you know, on the series that I'm heading right now, bumper to bumper, looking at the data and the click through versus like casual viewers versus subscribers versus new viewers, you know, we found that our, the bumper to bumper is skewing a little bit more towards our core, core audience. And, you know, but we do want to attract people outside. So it's like, how do we adjust the show to still be the show that our core audience wants to see, but is a little bit more accessible? We don't want to be too like hardcore car guy. I want people to understand my videos.

49:45I want people, even if they know very little about cars, I want them to be able to enjoy all of them. So and that's just my that's my true north. That's my compass is like, can a friend of a friend who knows nothing about the scene, watch one of my videos and understand what I'm trying to convey to them? That's one of the qualities that I try to instill in the videos, you know, instead of just like blabbering on about numbers and specs and whatever, you know. And again, just like it's a challenge every week to find that balance between our core audience and the audience at large, general public.

50:24Like, how do I tell a good story every week? It's a challenge, you know, and it's fun. And that's why we love doing it.

50:31Jasmine Enberg: All right. Rapid fire. Let's go, Jasmine. Kick us off. What does it take to scale and grow a creator business? Consistency. Authenticity. And an understanding of how the algorithm works and figuring out how to balance that correctly with your authenticity. Not everybody can be Mr. Beast, but you also have to understand that there's best practices that can make your videos perform well. What's AI really good at and really bad at right now? AI is terrible at coming up with ideas and writing videos. And the generative content is garbage when it comes to YouTube in general. It is a really good tool for research, for conceptualizing thumbnails, but not actually making them.

51:12And I find it helpful to help gather thoughts when there's a lot of ideas. But it's definitely not good at generating content or writing or anything like that at this point for us. Yeah, I personally am very old school. I still research all my stuff by hand. I've gotten really, really good at using Google over the years. So I feel like I can, I can, I trust myself. What's the biggest misconception about the creator economy? It's hard. It's not like you just turn on a camera, post a video and you become rich. It's you have to do a lot of jobs as a creator. What's the hardest lesson you've ever learned as a creator?

51:44You're going to fail. You're going to make mistakes. You're going to look like an idiot. But I think that's the only way you can learn the big lessons is by just falling flat on your face and looking stupid. You gotta let down your ego sometimes. I think another lesson like relating to this is like, yeah, you could read a bunch of nice comments, but those don't stick as much as the negative ones for whatever reason. I think a lot of creators can relate to that, but you just gotta like let that wash over you. Oh, and like, you're not gonna please everybody, you know? We have like a haste board upstairs and we have this comment printed out that says Donut's really just been killing it lately.

52:16And I love that. It's just like the most generic comment ever, but I thought that was nice. You know, sometimes there's just one comment you see and And it catches you when you're in the right mood on the right day. And it's like, you know what? Thank you.

52:26Jasmine Enberg: What is your advice to other people who want to be creators or are in that struggling phase? Believe in yourself. Stay true to yourself. You can't be afraid of being cringe. And I think there's this cultural thing where people are afraid of like what other people are going to think about them. And there's this like fear of being cringe that is just so prevalent. And you just kind of have to get over that. And you have to be OK with putting yourself out there. All right. Last one. What's the one thing you need to start a business as a creator? I guess at this point, a phone, right? Yeah, a good idea.

52:55Ooh, nice answer, Max. Nice. You can have a great thumbnail. You can be the best presenter in the world. You can have like great edits, but if you don't have a good idea, then nobody's going to pay attention to you. Well said. I agree. Well said. Thank you so much for this. Yeah, we're happy to be here. Thank you so much for having us on. Thanks for having us.