Why MatPat Quit YouTube

23:35Just because you retire from one doesn't mean you have to retire from everything forever. He's retiring from the host of these channels. That's a very specific thing to retire from, actually. Have you heard Marquez's octopus analogy? I think his video was fantastic. And I love his octopus analogy. You're kind of like cutting off one part of it. But I do think in this, in this whole moment in time where these retirement videos came out, I started doing some writing around it. And I really did think about the fact that I think you do retire from being a creator the day you start building your media company.

24:11Once you start hiring and scaling and starting to make the thing bigger than what it was to be a creator. Because you're not the creator anymore. You are the manager. You're a manager at that point. Is that what you mean? You added this job that is so different that comes with like the amount of stressors that it comes with as it gets bigger and bigger are so different from when we would come up with an idea and sit next to each other. And I'd be like, he would take a break from editing for a second. I'd hop in and put in a song. And I'd be like, oh, that song works really well. And then he'd come back and be like, dude, look at this song.

24:44Yeah, absolutely. Oh my God, that song does work. Oh, I got an idea. And he would sit down and that version of us, we retired from that version of us. That does not exist. Oh, I feel that so much. Actually, I feel that like, I feel that like in my stomach or something. I have memories of like Matthew and I in our first like six months of working full time together after we'd quit our jobs and stuff of like just sitting next to each other, like thinking up the tags for a video and like thinking up the title and like trying different stuff with titles and videos. And then, and then just like being there together and, and hitting publish.

25:15And I, I'm like embarrassed to say how long ago that was. That was so long ago that things were that simple. Dude, look at this comment that just came in. Yeah, absolutely. Or like, oh, I can't believe like how much the Twitter has grown or like of these these live stream comments are crazy. And being that close to it is it's really awesome and special and it feels much more simple, you know, as part of this kind of final stretch of videos that we're doing right now. It's been really nice to have a chance to revisit a lot of those moments. So, you know, for that announcement video, I was digging through old emails with with Lee and Ronnie and Ryder and some of our early editors on the channel and looking at like, yep, back before there was Framio.

25:53and all these text solutions for notes, I literally would just write pages and pages of notes in the videos. You say Framio? I say Framio. And anyone who says frame.io, it makes me so sad. We just say frame.io. Framio is the way to do it. Framio? I love Framio. It's so much better. Framio. Framio. Try it. Just try it. Try it out. Where do you upload your videos to? I gotta be honest, I don't even know what the rest of the sentence was. I heard Framio and I was like, I can't go any further than that. I was like, I'm so sorry. Anyone who ever inherits – It's like easy. I know you're getting to a good point, but I need to stop you at Framio.

26:25Everyone who inherits an editor from us ever will get an editor who says Framio. We will never. We will never hire. Why? We will never. If it says theorist media – Frame IO. Frame IO. Frame IO. You're taking too – it's a poorly optimized phrase. Okay. What do they say? This is so niche, by the way. What were you saying? Because Framio like flows, right? Frame IO is like three very distinct syllables, which are just not elegant. Please, what were you talking about? Please tell me what you were saying. I was – anyway, throughout this whole process and going back to that simplicity, right, of those early days, it's been so nice to revisit where we were writing emails, like literal emails back and forth of like, here are the hundred bullet points that I have for notes on all the different time codes because the technology didn't exist, right?

27:07Or even earlier this week before we got here, we were in Texas filming with just like a skeleton crew of like some of our long-term employees just kind of like bootstrapping it like we did in the early days of, hey, let's shoot some tanks and analyze like video game physics and do it that way. And it's been so nice to kind of take a week here and take some time away from being a manager, being in meetings, strategizing about business, you know, business strategies and this and that. That's still happening between 11 p.m. and – No, it still is. But it's been nice to afford myself that time and prioritize and get back to that and be like, oh, I miss this.

27:45I miss that. They're different jobs. Oh, very much. And like, yes. Colin and I, when we made that docu piece on Mr. Beastberger, we just flew to Jersey, just the two of us. Yeah, that's great. And we just held cameras. And it was this weird like, oh my God, this is the thing we did. We held cameras and we showed it like we'd go up to each other and show each other the shots we got. And we just, you know, it's a very different job to be that person. And I think there are days where I think about, and even as I was hearing all these retirement videos, I was like, the thought that comes into my head is like, is there a day where I'll retire from being the head of this and move back into putting a camera in my hand and editing?

28:30And from the outside, someone who's unfamiliar with our jobs would be like, that is, you're making videos. What are you talking about? Or just grab a camera and go make some stuff. Why not? It is, yeah. I'm like, I have cameras everywhere here, right? You have more cameras than ever. Yeah, more cameras than ever. And less time to use them. Yeah. And more editing software than ever and computers. And like, just, there was a time where it was just like Colin's laptop and we were sitting, you know, office. Yeah. And that's what I think is a big conversational point around retirement is what are we retiring from, you know, and what jobs did we pick up along the way that now we're trying to, to share.

29:09Damn picked out. Yeah. Absolutely. No, I think that's, I think that's crucial. Like there's, there's been so many moments where like we've just been so um distracted by the many many many other responsibilities that we have that we can't justify doing the creative stuff like we can't justify spending the extra time to like just do something that's creatively satisfying because we're just so needed in so many other places and figuring out fewer places to be needed i think is is really nice i want to ask you guys about 2018 because clearly if you're giving a talk at vidcon a year later about exit strategies.

29:45Outside of having a child, which is a huge life moment that will start making you think about the future. Yeah. What else went into that decision in 2018 to all of a sudden be like, oh, you know what? I think we want out and this is going to take a while. There are a few things that happened. One was that we had our son, which was a massive, momentous occasion. And that happened right in the beginning of the year. four days before we had our son, we lost one of our editors who unfortunately lost his life to suicide. And that was an incredibly tough blow on our team. And it happened. We found out about it literally like hours before we went into the hospital to have our son.

30:28And we were there. And five hours after delivery, we were both on an emergency phone call to our team to tell them that this had happened and to plan for what we were going to do next. And that was our experience at that moment. And so that was our, that was the middle of our year. And then, um, obviously that's has a huge impact. We wanted to make sure that our team was okay, that we were okay. And then following that a few months later, we, um, we were with defy and, uh, that whole, um, collapse of that organization happened. Right. And we lost, you know, a good couple hundred thousand dollars when that company went under.

31:11And it was like one thing happened after another that year to just like, you know, it was like, it was like some sort of fate, just like beating us over the head, being like, figure out what really matters here, figure out how to deal with stuff and figure out like what you're going to prioritize in life. And I think that kicked off a lot of conversations that ultimately began out of these like really tough moments where, you know, we were like, oh man, there's a lot going on right now that we are not happy with. And that is a real big struggle. And it got us to set up priorities that have lasted and really taught us so many things coming into like the full five years that followed.

31:54Well, I think all of those, like you said, it gets you to question what's important in life, right? And I think having a kid, having a family is it really gets you to recalibrate kind of what what it means to spend your time yeah and and it was at that point that i one of my catchphrase that i go around with and and in the wake of the retirement too is is one of these things like people ask like what are you up to what are you up to what's next what's next and what one of my first answers is always i'm so excited to just have friends who were friend employees you know we've hired all of our friends Yeah.

32:28Like, let's be real about this. Do you have this experience? Have you hired all of your friends? Actually, the first friend I hired was named MatPat. Wow. Which is crazy. There it is. That's true. Which is crazy. It was me the whole time. Yeah. I remember when we learned of you. We were like, but we have a MatPat. Right. And there was another MatPat, too, out there. Like, early days of gaming and stuff like that. But, I mean, like, that's one of the – I love all the people that we are so fortunate to work with. And we work with so many talented people who have been there for years on this journey with us.

33:01You know, some of them six, seven, eight years. And a lot of them started as our friends. A lot of them became our friends along the way. And I am so eager to be able to dial back the workload and just be able to spend the time reconnecting with them. Same thing with my – We've been terrible friends. No, no, we're the worst. Of course. Absolutely the worst. You know, we've had to like cancel a million phone calls with people. we've had to be like I'm sorry I can't we're filming I'm sorry I can't whatever like it's really hard and we haven't been like you know connected with our extended family we haven't been connected with friends and it's like oh these people still exist and the miraculous thing is that they're still willing to be friends with us and we're like wow that's what an incredible gift there's also though the dynamic of you guys as partners like you're probably going to experience each other differently right I mean like I could only assume because yeah i uh i find being like a youtube creator and being a husband to be really challenging like those two things are i i have to work hard at um because the amount that you're i call being like you're plugged into the matrix when you're on the internet right you're literally like it's too easy to fill time at all times metrics and decisions and all types of things and all times you exist on the internet at all times and you're plugged into what's happening in that space at all times and what you could and couldn't be doing to change things.

34:29And it's a, it's an all consuming thing, right? Yeah. So, so a question for you then, do you, do you try and strike like a work-life balance? I think we've gotten better at it now. Uh, I think on the, like, when you're trying to make it work, it's, it's hard. And I imagine the early days are, they're all consuming in a very different way than when it's working. Yeah. Right. And like, when it's not working or even when it just starts to work, you're riddled with fear that it's about to go away, right? Or it's never going to happen. Which is, I think, a lot of the experience that we had of this anxiety of like, I think I can do this, but I don't know why it's not happening.

35:08So I think I need to do it all the time and just get as good as I can, which is not conducive to go like hang out with a friend, you know, on a Friday. To be honest, on like a Friday or Saturday, it's like, it's hard to do. You just want to be working on the channel. I do think one of the toughest things, and you mentioned this briefly, but is when it starts to pick up and you're already exhausted because you've been through years worth of seven days a week, really late hours, just trying to make it work. And then all of a sudden it's like, oh, it's taken off. It's taken off. Something's happening here.

35:40Oh, my gosh. I'm so tired. But I got to keep pushing. I remember that time. I think I said this to Colin, but I was like, we just, it feels like we just punched our ticket to be in the race, but we've been running for years. Yeah. That's a great metaphor. We just got in and now we have to try and win, you know? And you're like, whoa. You were going down. Now it begins. It's been 10 years and like now, now we're in the race and everyone else is 21 and can dance. Do the floss. It's impressive. Oh no. I mean, there's, there's all of that. Yes. And there's like, there's so much to talk about when it comes to, when it comes to this, like sort of this, this dance that you do and, and how, and how much of a marathon all of being on this platform is and how, and how all consuming it is.

36:26Right. And so I asked about your work-life balance because we gave up on that a long time ago. There, there is no work-life balance for us. And I think maybe for some people, that is a great thing that you can strive for. For us, it was like a total fallacy. It was impossible to create a work-life balance where there was work and there was life. The only thing that works for us is a complete work-life integration. And it doesn't function. Literally, our lives absolutely fall apart if we don't work it that way. And so we do spend date nights talking about YouTube. Of course. And there are no working hours.

37:02There are no non-working hours. There's just when the work happens and when everything else happens. And sometimes they are so closely interconnected that it's impossible to tell which one you're actually doing. But that's the only way that we've been able to function as effectively as we have for as long as we have. And I think we're pretty proud of it. But it also sounds pretty nuts when you look at it. And when you look at our schedule, it is really an unpleasant thing to look at. What was, in the height of that, what was driving you guys? like what what what do you feel like you were chasing because some of that stuff is it is really hard right and after years and years you examine your own life yeah and you know perceivably you guys had even at that time have a level of financial success right have a family like what is driving you in that moment um to keep pushing and put out that much content and work that hard.

38:01Responsibility. Right. I feel like that's it. I mean, you can weigh in. I'd be curious to get your take. I feel like there's something that I feel like we should give a more concrete answer. No, no, no. Then this vague under. No, no, no. So you get weak. I can at least track it very clearly from era to era. Right. In the earliest days, like Stephanie alluded to, it was to get me a job. You know, like I needed a way to prove to potential employers like I'm smart. I can research. I can edit. Hire me because I can use analytics to create a thing that people will enjoy watching, right? Early. I got that job.

38:31And so I figured, oh, it's time to sunset the chain. Like achievement unlocked. I did it. Time to move on. But I am a notorious completionist kind of guy. And I really thrive off of trophies and things. And so I'm like, ooh, but I could get a play button and it's gold. And that like symbolizes some level of achievement. And so I'm like, well, I'm going to work until I get like a million subscribers. And then I got that. And I'm like, okay, well, achievement unlocked, did it, time to end the thing. But at the same time, the job that I got was consulting other YouTubers and teaching them how to read their analytics, how to optimize their audiences, how to work on the platform.

39:09And I had this amazing tool behind me that I, with the channel that I could run all these experiments. For a long time, we had back in the days of annotations, we had this thing called the super amazing end card tournament. And it was literally just me doing a bunch of experiments on the audience. And the audience was okay with this. Like you all were fine. They knew this, they embraced this, right? But it was me finding out all this data collection, figuring out things about like, is the left side of the screen or the right side of the screen stronger? Top or bottom? Left or right? You know, how many arrows in the description?

39:37What do they prefer? What colors do they prefer? What do they like to click on more? We also used to ask big meta questions like, okay, YouTube audience of 2014, when was the last time you turned on a traditional TV show? When was the last time you watched linear television? What percentage of you watch sports? What percentage of you have seen X, Y, or Z movie? And so we got a really keen media read. Do you guys put that in the comments or do you guys use like polls? A little bit of, I mean. All of the above. Yeah, all of the above. Yeah, oh, absolutely. That was fun. They were great. That was cool.

40:05People love giving their opinion anonymously. Polls were great. It's fantastic. Yeah, YouTube loses all the cool features. Yeah, right. But no, we tested out all of this stuff, right? And so there was a period of time. I think this was maybe before I got the million. But like there was a period of time where doing those experiments and figuring out how to optimize things was something I was continuing to do because it was helping me with my job and be better as a consultant. to everyone that we were working with at the time. And then on top of that, there was the point where it's like, well, at this point, we have a large audience.

40:33I don't want to quit for them. Like I am responsible. I have this relationship with them and they've trusted me to follow me on this journey and get me this job and answer all of these wacky questions and stuff. I want to be here for them and I want to continue making it for them. And then lastly, so like, so that's, and that's been the driving force for a very long time. It continues to be like a heartbeat of everything. But I'd say the last layer comes in now with our own employees, right, being business owners and making sure that we're setting up a responsible business for them. Yeah, that's what I would say as well.

41:06I think it's – yeah, the responsibility piece comes in with being responsible business people, not just responsible to ourselves. And along the way, our goals changed and stuff, right? Because there was one point in time where, you know, you talk about chasing the numbers and chasing the play buttons. And I think those are such amazing incentives and they drive, you know, they obviously drive massive motivation. But there was a point where we had to confront this idea of like, you know, there are other channels that are going to grow faster. There are other channels that are going to have more numbers.

41:38Their numbers are going to be bigger than our numbers. And there was a very clear moment. And I think this was in maybe 2014 or something like that when PewDiePie blew up. And we just watched him. We were right here and he was like, you know, and he just took off. and we had to sit down and have a talk because Matthew was a bit depressed about it. And so I'm like, but I work so hard and I'm so well optimized. Darn it. And, you know, and it's hard. It's hard to see. It's just hard to see all those moving pieces, right? And we had to have a conversation where we talked to each other about, you know, are numbers the only thing that you're going to use to define yourself and define your success?

42:21If that's the case, that's crazy. You can't define your success as a channel and your success as a human being by whose numbers are bigger. You're never going to win that contest. And if you do, what have you won? What have you actually won there? And there has to be some other metric that you can use to define success other than subscribership. And I think that was a turning point where it went from being about, okay, let's just try and get more play buttons to, no, let's try to build something that's interesting, build something that we're proud of, and then hopefully give it a life of its own.

42:58So at what point in the journey did you examine yourself and go, there needs to be formulas for all of these to scale? Or was that from just day one? Like the way you described the format of a theory video, you have that written down somewhere. There's some level of like a, almost like a brand book or brand Bible of, here's how you make one of our videos. We're going to leave, but you guys can continue this. This is what makes a good video. This is what the brand's all about. It's in the writer's training. Whether they listen to us or not, it's just up to them. Got it. Yeah. But was there a point where you like, you thought like we need to document this and we need to be able to instruct this?

43:34Because I find that to be amongst creators, including ourselves, one of the maker breaks of if you can do this is if you can communicate to creative people your creative vision. Yeah. Is that on me? Yeah. You're the one who wrote the Bible, the brand Bible. I did, but I think that we, you know, you're building stuff and you don't know what you're doing. And so you build stuff as you go. And it wasn't, I wish I could be like, oh yeah, we were such geniuses that we had this master plan and we knew everything ahead of time and we were going to write it all down and it was so formulaic. So by the time we had an employee show up, guess what?

44:11It was all laid out there in front of it. It wasn't. We made up all of the roles that we hired for. when we hired a creative director. Who has a creative director? I never really know what a creative director is. No one knows what a creative director is. For a while I wanted to be one and then I realized I have no idea. But go back to 2014. Did anyone have a channel manager in 2014? We hired one. We made up the role. Maybe Defy had some for Smosh or something like that. I don't know. MCNs had something like that, but not for individual channels probably, right? And so a lot of the roles we made up and so a lot of the training we made up.

44:45And at some point, you know, we knew intuitively what the formula for a theory was, but it actually wasn't that intuitive for people coming in. And we were realizing that if we were auditioning writers, the formats were all over the place. And we also didn't even have like, we didn't even have a set font for scripts until last year. We still don't. Until last year? No, there's a style guide. Are they not following the style guide? There's a style guide, which I fundamentally disagree with. No one's using the same guide. We spend 90 % of our time on fonts. all style guides together if you're not using the style guide that is on you my friend i'm just saying there's there's a style that works for me and then there's a style that works for the creative directors when they take over wow there's the him and there's everybody else no no no but i no but i appreciate that it's good that you're out it's good that you appreciate it here's where it came in though and i think that to answer the question what where it really started was you get to a point where there's only so much research that I, Matthew Patrick, can do in a given week on a topic, right?

45:46And as you scale the business outward and YouTube speeds up the production process and you're producing more videos at a faster rate, I want to make sure that we're still delivering a high quality of research every week, each and every time. But we're also trying to cover new trending topics that I'm not familiar with, right? When we launched film theory, you know, and Marvel becomes kind of one of our tentpole pieces of content for the better part of like six years. I don't, I was not, I did not grow up as a, an avid comics reader. And so if all of a sudden you're asking me to pull from like the deep lore of Iron Man or like obscure character from guardians of the galaxy or whatever, and how that kind of came and went, I was not equipped to handle that.

46:29And so that's why we had all these freelance writers and researchers come in, we would audition them, we would have them come in and write a spec script, give us a sample of their research. And they would, you know, because then all of a sudden, they were coming in with the experience that I didn't have, they had better research and better knowledge of where to go and could produce theories that I would have never been able to come up with myself because I just didn't grow up in any of those IP, right? And when you suddenly bring on a slate of freelance writers, you need a way to communicate to them like, hey, this is what we're looking for.

47:02This is the format that we're working with. And I think that was kind of the era where we didn't officially write it down. We had maybe like some vague bullet points and like some vague like hey, here's kind of the rough outline that you kind of follow. It wasn't formalized into a brand bible or anything like that. I don't even like that word. I feel like when you put something in terms of like, oh, this is our brand bible and this is the only structure you can work in. I think that's really limiting for people. The idea was to give people support. Right. When writers came to us and they were like, oh, my gosh, I just feel so overwhelmed.

47:32Like this topic seems huge. I don't even know where to begin. What we could do is say like, OK, really, though, when you break it down, like put your thesis in, put in your evidence points. There's a little twist at the end, something unexpected. And then there's a conclusion and you got it. And they're like, oh, thank God. And then and then they can go away and then they can find really cool stuff. They just needed like some kind of guardrails. So it's really about we want to put up a safety net for people. We don't want to put people in a situation where they feel constrained because no one functions well in that.

48:08Then you come out with stuff that doesn't feel real, that doesn't feel like it's a complete thought. It feels like it was just cut to fit in a certain shape box. Yeah, and there's still bespokenness to every episode, right? Like us figuring out the secret recipe of KFC is going to look fundamentally different than me wearing edible underwear. It's going to look very different from me eating a Christmas tree to me solving the lore of Five Nights at Freddy's. We really do all those things, by the way. Yeah. We really eat the Christmas tree. It really tastes that bad. And so within that structure, that very broad structure, there's a lot of nuance and opportunities for exploration.

48:44And the episodes don't feel samey, samey, samey because you are able to explore all these fun things. And there are areas in there that you're able to like mix up the intros and find new creative outlets. Again, that's the beauty of the format is if we're covering an analog horror series on film theory, that fundamentally affects the scripting and how, you know, it fundamentally affects the editing. You know, and that episode is going to look and feel and sound very different from when we're covering, like I said, Marvel or Bluey, right? Where it's like now the colors are different. Everything is very bespoke, which has been hard.

49:19And I mean, it's one thing to say like, oh, yeah, we follow a format and that has allowed us to scale. But we're still creating each and every week like a full slate of bespoke things to fit whatever the topic of the week is. So you've mentioned freelance writers. Yes. How big actually is the organization? Like how many people do you feel responsibility for as you usher them into this next chapter? It's grown a lot in the last year, right? So we sold Theorist at the end of 2022, so like a little over a year ago. And at that time, we had nine full-time, I think, nine full-time employees. And that was sort of on the bigger side that we'd ever been.

50:00How many freelancers at that point? And then about 20 freelancers, I think, at that point. And now we have 22 full-time and another 20 freelancers, right? So it's been a huge change. Whoa. And it's been a lot of like ushering people in. and we've spent a massive amount of time training people in the last year. And I think that's actually sort of a hallmark as well in terms of like feeling responsibility for people. There's feeling responsibility financially, but there's also feeling responsibility professionally. I think one of the things that has been the most satisfying about being a business owner, other than just the accomplishment of being like, oh, I did this.

50:36Like, oh, we're actually successfully running a business. We aren't breaking any laws. we are functioning and profitable all this stuff whatever you never know you don't know like i mean that's a good cover you know yeah exactly um guys knocked on wood

50:56but there's but there's the responsibility for people professionally a lot of people who come into this uh world i think and you work with a lot of creatives you know there's there's being motivated enough by money to want to cover your paycheck and live a decent life right but beyond that, money often isn't the biggest motivating factor for people. It's opportunity, it's responsibility, it's creativity, right? It's a cool factor. And one of the things that I'm most proud of just in terms of the way that we've structured the business and the way that we've grown it is by offering people opportunity, we've been able to see the best in them.

51:32So I think there's this, you know, the first thing I want to bring up is I think one of the biggest challenges in our industry right now is hiring and team building, right? Like that is, that is something that we're faced with. I think that might change a bit in the coming years as the crop of people who's just coming up and producing really cool stuff on online realizes they don't want to be entrepreneurs and they would prefer to be a part of a team. I think that actually the workforce will change, which will be really interesting, but team building is really hard and everything you're describing is like, it is a massive ingredient.

52:07If creators are watching this being like, oh man, I'd love to do something similar. Your guys' attention to detail into team building and just the dynamics of that, I think is something that cannot be overlooked because that's one of the hardest parts in a creative business. And even more specifically on YouTube, I think it's increasingly more and more challenging for people whose channel name is their own personal name. because then you're sitting in a room and people are throwing ideas out, but that have to do with the show name. That's your name. Right. You know, and that's, that's really different than I think having like a third party show.

52:42That's just like, we all work on this show together. Yeah. That's very different than like, it's your channel and I'm coming up with ideas for you to do and that represent your name. Yeah. And I do think that is one of the biggest challenges on YouTube of, of scaling. Like, I think, uh, like we talked about in the beginning, like channels that are personality channels are inherently not scalable. They just can't be. How do you guys hire people? Do you hire, do you just like hire people you know? Because for a long time, that's all we can do is hire people we knew because it was so hard to hire anyone else.

53:13I don't even really know like how early days it happened. But like Jesse, I think is a great example of someone who took a video of us at a talk we were giving and DMed it to us. And it was just like a really good looking video. and I you know looked at the DM and I was like that's cool and I was like you want a job? yeah do you want to film with us? like that was cool and it's been years you know it's been I think that was probably five years ago I will say we always start very small it's always like come for one project sure come for a week come for three weeks come for let's let's say a three month thing yeah and then before you know it a year passes and it's like okay like yeah yeah you are de facto an employee now you are now you're getting You're with us.

54:00But I think there's that, like, because everything you've described too, the responsibility you feel is, I think there's something very different in a creative company when you're working on a creative project. Because everyone's putting so much of themselves. Like, when you're a creative, your identity is wrapped up in your creative work. And with everyone putting a piece of themselves into this thing, it turns very familial very quickly, right? Like, you operate in a very different dynamic than if we were building a tech startup. Oh, 100%. Like, totally differently. So the dynamic of the team, the culture, the energy of everyone, most of our hires have come from word of mouth or other creators.

54:36Yeah. Right. They have to. They've come from other creators. Like, hey, I'm moving over here. There's this great editor that used to work with me or you guys. Like that is actually how one of our editors used to work for Matt D 'Avella. When he left from LA, maybe we're able to. And then like I like the way Matt works. So I assume if you enjoyed working with this person, we'll like working with them. We didn't know. That you could hire someone to hire people. This was a shocking revelation. It was unbelievable. Right after we acquired, we were acquired, we got a hiring manager. A recruiter. And a recruiter.

55:08Yeah. And she was unbelievable. So, so good. And she was doing things that we would have never dreamed of doing. She was going to people who had jobs. We were like, we always assume that you hire people because they're like unemployed wandering the streets. and you just take them in and you're like, here, I'll give you money and you do things for me. That is so true. And she was like, no, you go to people who are doing well at their job and then you poach them. And we were like, what? And so she did that and she went out and she didn't just post stuff on a random site, which we also can't do because you post stuff, you get a thousand submissions from people who are 12 and you're like, I walk dogs and I think I could be your director of everything.

55:52It's amazing how common practice it still is. Yeah. On Twitter all the time. I'm like, oh, someone's hiring and there's an email. Yes. All right. Here we go. Yeah. And that had historically gone very badly for us. And so when we realized that there is a person, there is a person and they can hire for YouTube jobs. And we, cause we also were like, oh, a recruiter, a recruiter hires for like regular people companies. They hire for like real companies, not for YouTubers. And so we'd never thought of that. And she got, you know, she got completely in the weeds. She got to know exactly what we were looking for.

56:26And the candidates she delivered were unbelievably high quality. And she, you know, also had the gall to go and do things that we wouldn't do, like go to other creator businesses and be like, hey, you're working for them, but you could work for these guys over here. I was going to ask that. Like, was she primarily looking within creator companies or is she finding people in more traditional jobs? Both. A mix of everything, yeah. Yeah, and I think at this point we're also in such an interesting time in the industry, right, where you can pull from both sides. We know people who have hired, like, traditional industry veterans at different, you know, at all different levels in their company from, like, the COO level, but just, like, producers, you know, writers, all kinds of stuff.

57:06But then I think pulling people out of existing creator companies is actually better. So for the most part, they just already come with so much knowledge about the industry and they already watch the platform, which is so critical, right? It's critical. And you also have to have the fluidity and flexibility in your mind. Like things on YouTube change way faster, right? Oh, absolutely. And even in a single video, like you have to be very comfortable with that at the 11th hour. You're like, actually, we're going to completely redo that VO. Yep. And we need a completely different graphic for that.

57:36Wow. Completely redo the VO? Yeah. I'm just like, I don't know. We're just completely. Not, but like that section. I'm saying that section. Not the whole thing. No, that's. Okay. But I'm saying there's like a section and you're like, hey, you know what? I have a different idea. Let's do it like that. And like everyone has to be on board with that's how this works. We just, if we need to punch something in, we're going to punch it in and we're going to do it differently. Sure. It's not as like structured. It's a lot more fluid creativity. Maybe that's why our production timelines are so long. No, no.

58:03I mean, no, it's totally true. And I'm just thinking about like, I'm thinking about all the times that we have videos going up on Saturday and we have to change the thumbnail because we've been working on the thumbnail all week and then it's like alright it's Friday afternoon that's not working and it's like alright we're going to change the thumbnail and everyone's like you can see everyone just like slowly boiling underneath but it happens a lot right and you have to be able to be like this sucks but we're doing it but it is one of those things too like because of how post production heavy our shows are And because everything is animated, we had to solidify very early on what that workflow was and how to make it sustainable and how once my VO is in, it's pretty much locked.

58:50You're not changing the VO. Yeah, which is why all of a sudden you're like, oh my gosh, all of that has to be every time. You tell them the VO has to change and it's like, what? No, you're allowed maybe a line or two here or there in an emergency situation, but for the most part, it's there. Oh, wow. But is there an ultimate? like decision maker on that show? Is it you? Yeah, I mean, it's me or it's the creative director in this case now. We also have a head editor. That's what a creative director does. And that is – well, and that's one of the things too is like – again, there are guidelines in place to structure like, oh, you have an easy ease in and we want to use matte every X number of seconds.

59:26Or like if you're using preexisting video footage, you credit it this way and you do X, Y, and Z frames around it, this and that. So there are rules and structures, but there's still that like little nuance that exists there that kind of makes it a little bit spicy and different for every single person. Because the first time on the show, we've brought up the easy ease keyframe transition. I just want to acknowledge that it's kind of a big. It's huge. Moment. Yeah, that is. That's a massive moment. Thanks for bringing that to the table. Yeah, of course. That's a big one for anyone out there. Easy ease.

59:54Easy ease. You can ease in. You can ease out. Right. But it's all over the place. but it's also one of those things too where like we had to coach everyone to aim for 85 percent which is a weird thing to say like we are we didn't tell him to tone him down yeah we are chronic overachievers what do you mean aim for 85 percent so our editors would kill themselves and work so many extra hours and like to get the perfect edit you know and i i need to create this entire thing in blender and it needs to be perfection and i'm creating you know this for this 30 second bit, I'm spending the next like eight hours to craft.

1:00:31And it's like, I appreciate that. I love that you want to do that. And that is why you are here. But we can't do that. No, but for your sake and for the sake of the channel and for the sake of all of us, we have to aim for 85%. Like if we got to like 85 % of the way there and we're like, yes, that looks good. Like that is great. And then the next time, you know, in between uploads or whatever, that's when we kind of work. That's when we train, save that, use it in the next one. because that's how you create that sustainability. Otherwise, we would all burn out. Does that also play into how the brand shows up?

1:01:04Like part of its sustainability, part of it is the brand is a bit DIY. Like there are elements of how the brand looks from the beginning that we have retained a little bit. Oh yeah, absolutely. And if we go 110 % into 30 seconds, it's going to look potentially too polished. Oh yeah, and yeah, there's definitely a lot. There's a lot of that actually. And I don't think that surfaces a lot, right? One of the things we mentioned to you guys before we started here was that we still work out of our house. We, which is people I think is wild. It is wild. And we've gone back and forth over the years, right?

1:01:39We were in our house and we had a studio for a while out here when we were in LA. And then when the pandemic hit and everyone was remote anyway, we were like, well, everyone's just going to work remote. And we rented out the studio and we moved to North Carolina. But when we moved to North Carolina, we intentionally got a place that was big enough that we could have a whole floor, now two floors, dedicated to studio space. And over time, as our team has grown, especially this last year, our whole house is basically just overrun with production. We live in like three rooms, and then the rest of our house is all just production stuff, right?

1:02:15And so there's a lot of complications with that. Again, work-life integration, not work-life balance. It's all work-life integration. You're always at work. Which is home. Yeah, which is home. When we film that style theory video about soap and washing your legs in the shower, that was in our actual shower. There's an episode coming up where we hire a stylist and they go through our closet. Those are our real clothes. Those are my real clothes she's throwing away, right? So when you have that, you don't have to fake authenticity, right? You're not building a bedroom set and being like, oh my gosh, guys, look, here's my outfit of the day.

1:02:55And it's filmed in a studio. You're actually in your house. And so you don't have to put on a layer of authenticity. It's actually there. And honestly, it saves time. It's efficient. You know, what you just said is like it does make it more efficient. It makes it more personal. These are all things that start to get put into question as you scale. Sure. Now, right? With the loss of that feel, that personal connection and whatnot. I mean, yes and no. Like the creative directors who are basically mini-me's. You've been this whole time. You're like, what's a creative director? A creative director is like they are the me for each individual channel.

1:03:35And they've been helping to spearhead the creative. They've been giving the notes on all the edits. They stress out in the background a lot. So they sit in the background and they fret. They take some of the stress. Yes. I mean, they're YouTubers, right? They're doing all the job that I did back in the day when I had my full attention to doing that. And as I've had to scale up, I've had to lose parts of that. But they are now – they are the YouTubers for their individual channels. And now they're rising up to the area where it is their channels now. And for the last year, I've been saying, hey, these are your channels.

1:04:05When these are your channels, when you are the host of these channels, they are yours. And so you're right that me stepping away loses some of that authenticity. But it doesn't because now all of a sudden it's – It's just somebody else's office. It's going to be filming in Amy's bathroom now, and it's going to be filming in Lee's or Santi's kitchen. You're like a huge X factor for being able to sell to Lunar X. Of course. Like that role alone, actually, a creative director. So that role, the way Jimmy has talked about this, and we've talked to him, is that the only way to train that role is they have to shadow him for years.

1:04:38Is that how those roles have come together and like how they've gotten up to speed? It's just like, there's going to be a period of time. you're just going to have to watch me do it? I mean, there are a few things. I would say, I mean, first off, pretty much all of them have been a part of the team, you know, no less than three years. I think Tom was three years, but he was a freelance writer for a couple of years before that. Amy's been on staff for seven years and Lee was our third editor. So he's been around for like 10 years. So while they haven't officially shadowed me for all that time, they have grown up alongside the channel, right?

1:05:15They have watched it. They have consumed it. They have been an integral part of it. And so what does it mean to shadow someone? Like it doesn't make sense to follow Matthew around an office for, you know, for days or weeks at a time. But it does make sense to be an integral part of the community. It makes sense to have grown up with the videos. It makes sense to have edited the videos. It makes sense to have made thumbnails for the videos. That is in effect shadowing exactly what the brand is, what the format is, what the videos are. and so once you sort of have that kind of like under your skin and you can't get rid of it then then you're already at the point where you can take what is fun about the format or the pieces of the format that most resonate with you put that into your own voice and hopefully carry away well and and this go again the beauty of the format personality hybrid right is people are like oh well it's going to fundamentally change when you step away and and i said this in the goodbye video, but like they've been writing these videos for the better part a year, a year, if not longer.

1:06:14Right. They have been appearing in the videos on the sidelines and in shorts and stuff for the better part of a year. You know, Lee has been literally editing the videos and giving notes on those videos for the better part of 10 years. And so, yes, me stepping away changes the voice who's reading those words. But at the end of the day, like the scripting largely should stay the same. You know, there'll be tweaks to the personality and there'll be tweaks to some of the jokes and things like that. But for the most part, they've grown up in that structure and they've been writing that structure for the better part of a year.

1:06:42Without people realizing it, I've just been presenting their words. And now they're just the ones presenting their own words, which is cool. And you're presenting it with also the flavor of post-production too, right? Because it's like, it's both ends of that. Exactly. That really make the show. Right. And the post-production team cannot, like, our editors are phenomenal. Like, they're more animators than they are editors. And I, like, we call them the editors, but they're absolutely animated. To fill 20 minutes, right? Like a 20-minute VO bed, as I'll call it, is hard to fill visually. Yep. That is really hard to fill.

1:07:16Four times a week, every single week. We produce, we burn through 11 videos every single week. We produce around 13 to 15 videos every week. What do you mean you burn through? We use and upload and publish 11 videos every single week. Game theory, film theory, food theory, style theory, three GT Lives, which is our live streaming channel. And then on top of that, now there's new shorts on game theory, film theory, food theory, and style theory. Wow. I don't understand how you do that. I really actually, I don't. I don't. Is there a role at Theorist, which is like as a creator-driven company that maybe a Vox or a more traditional media company would never have, like that is making this possible?

1:07:59How are you? Yeah, like how are they not, right? Like I was like a Vox not putting out that much. I think there's a point of pride in being a part of this channel and knowing that what we're creating is substantial and meaningful and high quality and putting it out into the world. And again, it goes to that ethos of us as a collective working together to make these things happen. And yeah, it's a lot. And it is – I call the number of videos that we create at this point disgusting because it is like – when you say, hey, congratulations, we finished our 11 videos for the week. Start again. Let's do it again.

1:08:31You know, it's crazy. It's wild, you know, but you know, I'm no math guy, but 44 videos a month. Yeah. Right. So many, it's a lot of videos, videos. Yeah. So I think the quality you guys are producing. And the TLDR is like, we've clearly gotten them to drunk the Kool-Aid. We've clearly all the way bought into our own hype. Just absolutely deeply bought into our, we're doing something really meaningful here, guys get out there. No, there, I mean, but there is a point at, at, you have to be like, okay guys, like if something goes wrong, we've had, um, like there was, there was a, there was a moment last year where it's like something went wrong.

1:09:03We lost some footage for a video and like that sucks. And you're like, Oh man, I can't believe we lost this footage. And, um, you know, we've had people like cry about it in the office, like unbelievably upset. And, and like you do, like at some point you have to go to people and be like, you know what? It's YouTube. This is a YouTube video. It's fine. This is a YouTube video. Nobody died. Nobody died when we lost footage. Like we're on YouTube guys. It's okay. Like we're going to be all right. Well, and the other thing too, I think like is we never ask people to work harder than we ourselves work, you know, and I think that that's a big part of it too is, you know, if you think about it, you talk about 44 videos in a month.

1:09:42Up until this announcement, I am in every single one of those videos. I am the one voicing it. I'm the one in front of the camera. I'm the one editing it. Yeah. Right. Think about that. Every 44 videos a month, 12 months of the year for, I mean, 13 years, like, but it's ramped up to that. But like every single one has been my voice, my face, you know, my notes, whatever it is. November of last year, Matthew was like, there was like a Friday night where he was like supposed to do some pickups or he was supposed to like, you know, review some footage or whatever. And he was like, I can't do this because I'm so sick of hearing my own voice.

1:10:16I just hate my voice. I can't listen to it anymore. And I was like, yeah, of course not. Like this is too much. And like, you know, I think some people when they saw the announcement video go out about this whole thing is like, oh, he's burnt out. And oh, he's leaving the platform because he's burnt out. It's like, no, actually, like, clearly I could keep doing this from now until forever, right? Like, this isn't burnout. Like, I'm fine. This is fun. It's still enjoyable. But at the same time, I just recognize that it's my time to pass it on. And this is the moment. It's a lot for one person, right?

1:10:46Like, you can like something and you can not be burned out of doing it altogether. But you can be like, yeah, I recognize, like, being in 44 videos a month is like, it's like too much. Too many videos to be in. Like, somebody else should be doing this. Yeah. So when we go back in time to when you first started having this conversation with Lunarx, were there other suitors? And there were. Yeah, a lot. A lot. And when you took this to market, what do you think was most attractive? I'm curious about the revenue pie chart at that time. How much is AdSense? How much is brand partnerships? Yeah. What does the business actually look like?

1:11:23And then as you go to market with a YouTube channel, like I think people would be interested to understand what are you selling, right? Like the IP, of course, the actual videos, the, you know, like what goes into a deal like this? And what did the company look like from a revenue perspective? Yeah, absolutely. So, yep, we got a lot of phone calls about this after we sold. And I think there's a lot that goes into that, right? So the first part of that was like, what was the revenue pie chart? Oh, yeah. What was the revenue pie chart? Okay. And the first question before that was, were there other suitors?

1:12:01So, and before that, it was like when you went to market. So I was going to say, we should start with when you went to market. The first thing was we didn't go to market. We didn't go to market. We got approached cold by one company and then another and another. And we were like, this is weird. We should at least be. Yeah, it was weird. Out of the woodwork. Cold. Came out to you cold. Out of the woodwork. Totally cold. cold emails from companies who are interested in buying. Well, real quick, we talked earlier about how we were talking about YouTube exit strategies back in 2019. Oh, yeah. We were talking about investors coming into the space back in 20, what was it?

1:12:352018, there was like, you know, a VC firm that approached us at VidCon being like, hey, I want to invest in this space. How do I do that? And we were like, people aren't there yet. We literally told them like, people aren't there yet. there's not enough sophistication in this space to do that. They were like six years early. But after the exit strategy conversation, we at least knew that this was possible. There have been very limited kind of investments in YouTube channels to date. There have been a few examples of acquisitions and some big ones of acquisitions not going well. You guys have talked to Smosh.

1:13:12We've talked to Smosh. All of that. Um, but we hadn't thought about selling, you know, anytime soon really, um, or it wasn't really quite on the radar yet. And we didn't know what that picture would look like at all. We were just totally undereducated, totally uninformed. And we started getting these requests out of the woodwork and we were like, um, we took a phone call and realized immediately that we had no idea what we were doing at all. We were like, we don't know how to value ourselves. We have no idea. Even the vocabulary of these conversations, I needed, you know, I need a whole different dictionary for this, for this line of thinking.

1:13:49And so we went back and did a lot of work internally. We got, you know, professional partners. We got a banker. We called like the only person we know who had had their company acquired and it had, and it had gone well. And we were like, what do we do? and he pointed us in the direction of Liontree, which is like, you know, it's a bank with some clout when it comes to like investments in the media space. They were involved in the Maker Disney deal. They were like, they were involved in major mergers like CBS and all this stuff. So they had a lot of experience, but they had never really worked with an individual YouTube channel or a creator business before.

1:14:25So it was like a huge learning curve on both sides. And once we were kind of through that, then we were able to say, okay, now we can have our first intelligent conversation because we were on the phone with the first people who contacted us. They were on the phone. They were just like, well, like, what'd you sell for? And we were like, well, we don't really know. We need to think about that. Like sell outright? Yeah. So that was the first conversation. The first conversation is - We want to buy the thing outright. Yes. Oh, yeah. Interesting. And we were like, no, not really, but I'm curious about this conversation.

1:14:57And they just kept asking us to like pitch numbers out. They were like, well, just, what do you think? What do you think? And we were like, well, we don't know. We need to go back in and, you know, work on doing evaluation internally. And they were like, yeah, but what do you think? And I mean, we knew immediately that we were at such a disadvantage. And so once we had finally come over this learning curve, then we came back and we had a sense of what we thought we were worth, what we had, what we could back up with numbers based on, you know, what the revenue was looking like and how our revenue was split.

1:15:31And then we were able to come to the table. And over the course of the next several months, we had lots of other people who joined the conversation. And all in all, from start to finish, we talked to 10 different companies about selling from all across the spectrum, small VC firms to the biggest media brands out there. And what was also interesting was in those conversations, every single one had a different thing that they wanted to do with us. Right. Some of them were only interested in the gaming side. Some of them were interested in taking the company and breaking us down and integrating them, us into their digital video production.

1:16:07Like, hey, you've been able to create a really good digital video stream. We want you to do that for us. Meaning like an acqui-hire. Yeah, yeah, exactly. Like, we'll buy you and you come work and integrate into our company. Yep, exactly. Exactly. And some were like, okay, well, we have a food vertical and we have, you know, style content. So we're just going to take the four channels that you have or the three channels at a time, and we're going to break them apart and we're going to send them into these different lanes. And we were like that. And rebrand them. Yeah. Maybe rebrand them or maybe just like completely disassemble all of the workflow pipelines, take apart how they're being done and completely separate them and silo them all out so that they just have no connection to each other at all.

1:16:48All of these systems and a lot of them right off the bat, we were like, these aren't going to work. Yeah. There's no way. I think that was one of the things that was most surprising, though, is like you would think like, oh, everyone's going to approach this acquisition from probably the same angle. But no, they were all vastly, vastly different and very quickly helped us narrow down the field of like, hey, if we are – You get it. You don't get it. You don't get it. You don't get it. Because there were immediate red flags. And also like one of the things that you hear talked about a lot in the M &A space is this idea of like what does a good partnership look – what do you want out of a partnership?

1:17:18And I think while it sounds like just lingo, it's actually very true, right? It is a partnership between one company and another company. And in an ideal world, you are working together for the betterment of everyone. Both people have to bring something there. But whoever is the buyer, ultimately, if it's an outright sale - If it's an outright sale, yes. Can do whatever they want. 100%. So it's like, it's actually, it's not a partnership. Right. Right? Like, you have to trust this person to take care of the brand because - Absolutely. Right? And you can write lots of stuff into contracts, right?

1:17:47Sure, but it doesn't matter. They can always change their strategy. At the end of the day, yeah, they have veto power over a lot of stuff, right? And when it comes to what they're buying, that was one of the questions you asked. What are they buying, right? So for us, it was a few different things, right? It's obviously all of the IP, all of the intellectual property rights of anything that is our channels, that's derived from our channels, spin-offs, all of that kind of stuff. and that's where it becomes tricky and I think it's even trickier for YouTube channels that are based around a personality because you have to be able to draw a box around what is our channel actually right what is a theory it's like okay it's a piece of like edutainment content that is done in an animated style it's done primarily in voiceover but like sometimes maybe not and you have to be able to define what is this what is a theory format so that you can understand what it is and you can also understand like what it isn't because as people Matthew and I also exist on the internet like just as human beings and we might want to do something else ever someday and you want to be clear that what we would do if we I don't know create a travel cooking show yeah where does theory begin and your video essay end or like you explain something on the internet right Right.

1:19:11Is that a theory? So we had to define like what the heck, what the heck is a theory and also say like, okay, outside of that, Matthew and I can exist on the internet as people and talk about other stuff. We can talk about the fact that we went to the beach or we can make a video someday about, I don't know, a trip to Greenland, whatever it is you want. Um, so So defining what you're buying is actually harder than you think. It's hard. And then like how do you – I don't even know how you would do that for like a vlog channel or, you know. I don't think those are – Acquisition targets. Acquisition targets.

1:19:50No. It can't be. It has to be a scalable media brand. They can be investment targets, right? Sure. In the same way that you would invest in like in a professional athlete or something like that where you would own a piece of their business or own a piece of their – like the back-end partnerships or something like that. But yeah, it's not the same, right? And so there's the intellectual property defining what that is. And then there's this idea of like, we've, we've built a system that runs, right? We built a functional, profitable business that runs. And I mean, you're, you're acquiring the EBITDA if you want to get really technical about it.

1:20:22I didn't know what EBITDA stood for for so long. And we should, if there's someone listening who's heard the term, used the term and doesn't know what it stands for. I think in our industry, it's pretty much synonymous with your profit, right? It's just your profit. It's your profit. Before you pay your taxes, it's what it's earnings before interest. Right. Taxes and something else. Amortization was an appreciation. What's the, what's the, there's an, there's an on there. I don't know. See, no one knows. What a ridiculous term. Right. Let's use profit. Yeah. Right. What's going on. So yeah, it's, it's basically like, okay, if you make a million dollars in a year and you spend$800 ,000 of that making the production, you're left with$200 ,000.

1:21:04Yeah. Which is profit. That's basically your profit. I mean, basically. And then you're going to end up paying like, you know, whatever, between 50 and 100 grand to taxes or whatever. And, but before you pay those taxes, that's your EBITDA. That's it. And then there's a revenue multiple on that. Yeah, sure. Yep. Did you guys learn about like, cause I don't know, I don't know if you can or can't share that, but like, that is something that I think that people are exploring of like, what is the revenue multiple on a YouTube channel or a media business. I don't think there's a standard. There's not a standard.

1:21:34Because it's all the stability of the business you're buying, right? Sure. And the potential of the business you're buying, right? So when you talk about tech companies, oh my God, this is so geeky. This is so boring. I'm so sorry. By the way, I'm so sorry for the retention you're losing right now. No, no, no. It's probably increasing. This is the show. We've been boring up to this point. I know. All this mushy garbage. All the other stuff we're cutting out. Yeah, please. It was garbage. and now we're here and that's all that means. Wait, give Easy Ease the credit that Easy Ease is right there.

1:22:04It makes the internet run. Okay, Easy Ease. It does. If I could invest in just... It brings calm and peace to many people on the other end. If I could just invest, acquire Easy Ease as a concept, that is the best investment I could make. That's whoever invented the Easy Ease. Right? People at this point are just Googling. Like, look at the Google trends after this goes out. People are going to be like, Easy Ease. Yeah? Please. Duh? What is it? Yeah, right? No one knows what the uh is. What's the uh in Eva Duh? So you have tech companies, right? And they've created something that's like some amazing little app.

1:22:36And everyone's like, wow, this has the potential to reach like a gazillion people and make a gazillion dollars. And so they get some crazy multiple 10x, 15x multiple, like something wild, right? With YouTube channels and, you know, a lot of times that's not warranted. But every once in a while it is. Okay, fine. and YouTube channels are a completely different model from that, right? On the other end of the spectrum, you have traditional businesses where you may be like 2X, 3X or something like that. If it's like just a tried and true kind of business, you don't expect it to change very much. You don't expect it to grow very much.

1:23:11The multiple is smaller because there's not all this like crazy unlocked potential there, right? YouTube channels fall like somewhere in the middle of that. Also because there's subjectivity around like the key individuals. Exactly. 100%, right? Yes, very much so. there is a question of that's still probably up in the air. What happens when you guys are fully out? A hundred percent. Isn't it a fun mystery? I don't know. Stay tuned to find out more. I think they call that. It's a key man risk. It's a key man risk. That's the big buzzword in, in like in investment in this space, the key man risk.

1:23:44Right. And one of the things that we came to the table with. KMR, as we call it. Oh, the old KMR. It's KMR. I love it. KPI is the KMR. Exactly. It should be key person risk, by the way. Yes. Yeah, exactly. I wasn't offended. It's fine. But I think just generally it should be. Key human risk. Key human risk. But if there's a dog all of a sudden. Yeah, which is possible on YouTube. Right, key thing. Yeah, right. Key dog risk. Grumpy cat. Grumpy cat. Grumpy cat goes away like this. Maybe key existence risk. Key existence. Key entity risk. Key entity risk. Key character. Kerr. Kerr. Kerr. Kerr. Kerr.

1:24:23So there's the - Sorry, you were saying - What was that? Multiple? Sorry, I forget. I don't know. What's going on? So yeah, there's a huge amount of subjectivity around how much does the owner of the channel or the personality on the channel matter, right? With a personality-based channel, it's everything. And then you work into these formats and maybe it doesn't matter as much, right? And for us, I think it helped that regardless of acquisition, this was going to happen anyway. I don't think people realize that. Did people realize that? But it didn't matter if we sold. Like we were going to do this anyway.

1:24:56Yeah, this was going to happen. We were going to step away. This was going to happen. And we were already building up the company. We were already training up people. Like the acquisition helped further that along and helped secure those pipelines faster and probably more effectively than it would have otherwise. But this timeline was always happening. Did you look at other possibilities of financing, if not acquisition? No. No. No. No. No. You weren't interested in that? or you were just like, financing comes with the responsibility still there. Exactly. You lose a lot of control, but now all of a sudden there's a lot more oversight, right?

1:25:32We're control frees. Either we have it or we don't. There's no middle ground. That's it. We are type A plus. Here's the thing. And we've actually, so I don't know, I think we are a lot more uptight about this kind of stuff than other people, but we've talked about this as it relates to even stuff like Patreon and fan funding, which are wonderful tools. They are great. but as soon as you take money from someone, and this is just like a hard fact of the world and it sucks. As soon as you take money from someone, money isn't free. You owe them something. Yes. You have another responsibility. And we already felt a lot of responsibility.

1:26:05We've already been over that. There's a lot of responsibility. And so when you take an investment, right? You've taken money. And now you owe something. You are expected to pay that back in multiples, in fact. And so if we were confident in the business that we're building, great, we're fine on our own, having that middle ground just wasn't an appealing idea for us. And I think for some people it really is because they feel like they have a partner, but they still feel like they have all this ownership and control. And for us, it didn't feel like the right fit. Well, and also, I mean, we didn't need it.

1:26:36Like if we really wanted to. It wasn't about the finance. No, it wasn't about the money. We are tremendously profitable. Like, I mean, the fact of the matter is like our business is tremendously profitable. The EBITDA is great. Big EBITDA. Big EBITDA. Big, big old EBITDA. You know, it's made a mighty EBITDA. And that sounds like a really inflated thing to say, but I think it's really important to be honest about these businesses, right? A lot of them are incredibly high margin. And that's not, and we've like, you know, through various weird emails that we've gotten over the years, we've gotten sent a lot of other people's books, other big creators in the space, and they are just as profitable.

1:27:13I mean, like, this is something that I think is an honest conversation to have. And they don't need financing. They don't need like a cash infusion. Right. They have it. Yeah. So it's called it's called brand. So we're getting more money. But with, you know, but you're sacrificing control. And I think it's, you know, it's important to know, you know, I think for us, it's one thing to say, like, oh, look at us, biggie, but this and that. But it was always intentional because like we are very fiscally conservative because of that responsibility that we feel to our audience. Yeah, totally. 2023 was a hard year for this industry because there was a lot of tech shakeups as a lot of people are getting laid off.

1:27:49There was a lot of uncertainty on the platform as shorts take up more screen real estate. And so those long-form videos that actually monetize are getting less and less views as short-form, which doesn't monetize, slowly take over the screen space, right? And so on harder years, having that big old EBITDA and having something that is a nest egg for the company ensures that you don't have to panic and that you are still able to sustain and pivot and grow and make sure that your employees are taken care of for when it's tough. This episode is brought to you by LifeLock. When you visit the doctor, you probably hand over your insurance, your ID, and contact details.

1:28:30It's just one of the many places that has your personal info. And if any of them accidentally expose it, you could be at risk for identity theft. LifeLock monitors millions of data points a second. If you become a victim, they'll fix it, guaranteed, or your money back. Save up to 40 % your first year at lifelock.com slash podcast. Terms apply. 2018, like when we lost over 250 grand from the Defy thing. Still have nightmares about it. but when but when that happened it was like that really sucks for Matthew and I right that sucks for us it doesn't have to suck for anybody else our employees do not see that they don't feel it no one got laid off no one got to talk about we have got to tighten our belts guys we're like we got to cut back on these no one got that no one felt it no one had to worry and that was that's the point so I think it's really important to note that because we are entering the era of like sometimes YouTube channels are discussed like, you know, early stage tech startups, where it's like invest everything back in, you know?

1:29:32And I think the base premise of YouTube is like, you do a thing that doesn't cost very much money, right? Like you, it started with like film on your Mac book. Or at least it shouldn't cost a lot of money. It shouldn't, at least in the beginning, right? And then as audience grows, revenue should grow, but production costs should grow very minimally. Right? Like it should, it should actually not necessarily, it does not need to be proportionate to revenue growth. Correct. Yes. It actually should just slowly grow and it needs to operate like that. So the overhead is low enough that you can deal with the volatility of the business we're all in, which is advertising.

1:30:06Right. We're matching the ad market, right? With like, there's a volatility to AdSense. A market that you don't have control over. You don't have control over. You can do nothing about that. And a platform that you don't ultimately at the end of the day have control over. You're building great. You're building a business on quicksand and you're building it where it's fun funded by people who are at the best are like cyclical yearly and are subject to all of these like crazy consumer whims and these huge other market factors yeah there's like nothing in your control there right that to the vcs yeah they love that they were like quicksand it's exactly yeah and it's supposed to buy this guy sounds like rock solid let me in they're banging down the door for that pitch no but i mean like Like you hear it all the time, like with BuzzFeed, you know, when they're one of the biggest brands to exist in the digital video space.

1:30:54And all of a sudden they're like, and we're going to expand into Facebook, all in on Facebook video and this and that. And then all of a sudden Facebook video goes away and isn't a priority. Now all of a sudden you have all this investment and all this overhead that you're responsible for and it goes away. It's also about keeping your process sustainable. Yes. Right. Oh, absolutely. As you're saying, it's like cyclical. A lot may happen. It's a long game. Yes. And you got to be able to withstand. Yep. it's a lot like stocks in that way right you see the rise you see the fall but like and the beauty of our format and our brand has always been like we've never had that big thing that popped off there's never been that big viral hit it's been year over year smart sustainable growth and smart sustainable programming do you do you have the thought we i feel like as a youtube creator you always have to have this thought of like what i'm creating could i do this by myself again if i needed to oh sure i mean like yeah absolutely i feel like you kind of had to let go of that like a while ago.

1:31:45Like that's the thing because there's no way, right? There's no way to even, to even come remotely close to anything, anything like the scale and anything like what we're doing now, because specifically because, you know, like you said before, you hire people who are much, much better at doing different parts of it than you are. And there's no way for us to replicate those skills at this point. There's no chance, but the idea that, okay, we're going to launch another channel, but guess what? It's not a different format. It's using the same writers because they've just written a food theory. Now they can write a style theory.

1:32:13Right. And And the editors, they've been editing a game theory, but they can edit a film theory. And guess what? Yeah, they can. And they're and they're great at it. And so using translatable skills is what really helps to keep the overhead low because you can use the same people who can, again, expand their skill set, get into new creative mediums, feel creatively satisfied because they're not stuck only editing and animating video game characters. now they're editing and animating Marvel characters or fruit I don't know me dancing around in bread gloves exactly or whatever the edible underwear the Grimace Shake episode we keep going back to edible underwear you guys really like the edible underwear there are some images that please do that the entire time whenever you see retention dipping just insert that clad one yeah that'd be great please and that's how I think we've been able to keep overhead really low because because we are adding to the same group of people who can do everything.

1:33:11We're not creating completely separate teams to do all of the different channels. It's really all one big pool. And that's also the only way that you keep it even remotely feeling like the same brand, right? How else do you have a gaming channel and a style channel and a film channel and a food channel that actually managed to feel like anything close to the same brand? There's only one way to do that. And you have to have like overlap with the people working on them, right? It is also worth calling out. Like we were very upfront with Lunar when we said we are stepping down. You know, like this was not a surprise to them.

1:33:43It was something that they were fully on board with. It was something that they believed in. It was a selling point, actually. I mean, the idea that they were because they brought up to us the key human risk, right? Yeah. The key entity. The Kerr. The Kerr. And we were like, no, we've been planning for that for a long time, actually. and here are two going on, three creative directors that we already have in place. You know, we're only missing one and then we ramp them up and then we set them loose. And here's our training plan for them and this is what they've done so far. This is where they're going.

1:34:15And all of a sudden, you know, like we were talking about, that key entity risk is scary for a lot of investors and a lot of people. As it should be. Totally right. At least 100%. But the fact that we were already in the middle of the process, the fact that we had already had data to show like, hey, these people are, liked by the audience and look at all these scripts that they've produced that have been well-received and the episodes where I haven't done voiceover, those haven't shown a significant performance dip. Like all of those things combined into like, hey, we are willing to take this journey with you and we support where this brand is going.

1:34:45Yeah. And kudos to them for doing that. I mean, huge, huge. How important was having data around launching new channels and new verticals? Because I imagine that's also an X factor of like, well, we have a team here. It could launch, they could launch fitness theory there could be tech theory sure yeah big yeah big it showed that we were able it showed that we had a format that could travel and that we had a brand that could spread you know like the thing that we talked to them about because again like you're talking to investment people you're talking to people outside of this space who don't understand YouTube but if you put it in slide decks they understand it a lot a lot of Gantt charts if you can just if it can fit on a PowerPoint slide it's suddenly comprehensible yeah But we talked to them a lot about how being a theorist, it's a lifestyle brand.

1:35:32It's approaching the world around you with overthinking, with a sense of curiosity and wanting to optimize your life. If you are a fan of sports, congratulations, you are a theorist. If you are a fan of cooking and you want to optimize your recipes, you are a theorist. And showing that we had had success in film and food and gaming, that was already a point. and saying like, hey, and we are a couple months away from launching style theory, which is fashion, you know, fashion and beauty, which is a whole separate audience and vertical that we can tap into. And here's, you know, sports theory. If we ever are able to find a system where the sports leagues can get involved, which, you know, it's not.

1:36:14We've talked to them. They wanted too much control. But it's one of those things that like, hey, maybe at some point ESPN or Hulu or any of these companies are looking for ancillary sports related content. That will happen. Oh, absolutely. I am – sports theory would have been our first spinoff. Like we had very serious talks with all the sports leagues back in the day. They wanted to like own pieces of all the content and all that stuff. Again, control freaks. We either have it or we don't. But it absolutely will happen. Same thing with music theory. Same – like our audience has been asking for book theory forever.

1:36:42I mean like it really can spread out and each one of those is its own interesting merch vertical. You know, food theory is able to capitalize off of pots and pans and cookware and we're testing out the best cookware. and then we're making our own. Style Theory is making its own apparel brand, you know, and we're doing a fashion show in April. You know, we own Fashion Week and we're spotlighting all these different creators. Game Theory, we're creating our own game. Film Theory, we're commenting on these smaller indie series and let's make our own animation show. And all of a sudden, you see how broad this brand can be and how exciting it is because we have the marketing arm being able to talk about it with the theories.

1:37:18But also, our audience is tremendously favorable towards new IPs. and they will follow you when we say like, hey, here's a cool new channel that you've never heard of or here's a cool new movie or this game that you'd never play, but here it is. They'll follow us with those places because we have that trust. And so instead of talking about other people's products and ideas and stuff, like why aren't we creating them ourselves and then solving it internally and seeding it out for them to talk about. And when it comes to launching the new channels, I mean, it's excruciating. We have like the most uptight process for launching a new YouTube channel that I've ever heard of.

1:37:54And we had basically, for lack of a better term, like an actual playbook for how to launch a YouTube channel. That's the playbook that existed long before anything else. Actually, we had a channel launch playbook. Let's hear it. And we had, you know, we've given talks about this. We've consulted a lot of people on this. And it comes from just an overweening amount of preparation ahead of time. we research every vertical that we go into. We watch everything in that vertical. We understand how the hosts talk to the audiences. We understand the colors they use, how long the episodes are, how often they post, what their opening lines are, whether they have a theme song or not, what their titles include.

1:38:33Do their titles include punctuation? Do their thumbnails involve a white stroke on the outside of everyone's head? Whatever it is, we know everything about the vertical before we even decide to go into it. And then from there, we decide, okay, can we play in this space? Where aren't people saying the things that we would like to say? Are there enough collaborators in this space that we think we could be part of a community in this ecosystem? And then from there, it's like, okay, what would we actually say? And we come up with literally a year's worth of content titles and log lines. If you don't have, if you don't have, and I mean, maybe more than that.

1:39:09It was like a hundred, it's like a hundred, a hundred titles and log lines. And if you don't have a hundred titles and log lines, you don't have enough content to like think about launching thumbnails to those or like a couple of thumbnail mocks or like, how do you do totally like you do? You get, you have, I mean, you have to think about the audience that you want and what they're already watching. Of course. Right. So, I mean, I think it's, I think it's very common practice for other people to do this as well. And what's really fun is when we start to see people doing it back to us. That's when we know we're actually part of a community.

1:39:41Style is a great example of this, where we have channels that we super admire in that space. And we watch everything that they do. We watch how they speak to their audience. We watch the structure of their videos. And we're like, this is so well done. We admire this so much. And we take what we can as it applies to what we're doing. And we do that same thing with thumbnails to try and say, okay, if we want a similar audience to kind of watch our stuff? How can we make them feel comfortable enough to click from this video to our video, right? How can we bridge that gap for them if they've never been here and they don't know what to expect?

1:40:15Can we make them feel more comfortable? Can we help bring them over? And we've started doing that in the style space. And we've just, as of a few weeks ago, started seeing other people mimic our thumbnails in that space. And we're like, oh, we're in, we're in, we're here. And And now we're having a dialogue with those other channels. And then maybe we collab with them. But if not, we know that there's like this implicit friendliness of like, okay, we are helping each other. And we are supporting each other through a visual conversation or a, like a format conversation where we know that we want our audiences to talk to each other.

1:40:50Then it's interesting. It's super cool. Analyzing your vertical is something we talk about a lot of like, how do you even do that? Yeah. Because your vertical exists on YouTube, right? Which you have to study deeply. Because the suggested videos, I think it's a very interesting thing you're bringing up. But I also think you actually need to recognize and understand where your vertical exists beyond. Sure. And what type of information they're engaging with there and what type of, because the only way you can see the gaps is if you fully understand in the real estate of the internet, where this vertical hangs out.

1:41:21Right. Right. Like where do these people hang out? Yeah. What are they engaging in? What are they not engaging in? Like you just have to really deeply look at where the white space is. Yeah, Instagram, TikTok, all that. But it's – and then from there, you know, going back to the playbook idea, it's once we've kind of developed all this list, once we've done all this research and once we've kind of got the go-ahead, it's we have to launch with five videos. Like day one, five videos. It's not launch on an empty channel. It's not here's the only one. It's five videos that within those five videos give you the thesis of the channel.

1:41:54Here are the range of things we're going to talk about. here's how they're going to look here's how they're going to sound here's an episode about hygiene here's an episode about clothing and personal style here's an episode about you know a real life experiment where we do something wacky like try to kill you with a high heel you know and here's something did really well it did people were really excited to kill things with with high heels yeah you know here's one where we analyze no you yeah right here's one where we analyze hulk's pants because we're going to dip into fictional characters and fictional ip and how fashion plays into that space.

1:42:27And then from there, you know, we've taken you on a watch journey. You've gotten a sense of like what this audience, you know, what this channel represents. And also from our side, we've gotten a sense of what videos have gotten the most traction. And we see like, oh, they really like this one. They didn't care for this one as much. Like maybe we need to, you know, do we still want to pursue this? Do we want to kind of like merge more into one area or another? Yeah, we can turn the dials in the background about what kinds of topics we're covering based on that initial burst of viewership that we see.

1:42:55And when we're going in for an actual channel launch, we also focus all of the attention on it, right? Style theory is a great example. We got to a million subscribers in 62 hours, right? Whoa. Yeah. Yeah. Quick. Wasn't 62? Yeah. Wow. I think it was, yeah. I think it was less. Was it less? But anyway, it was one of those things though. Like again, you're structuring it. It was very short, right? It was a very short amount of time because we intentionally sent people to a channel with everything we had from every other channel. We pointed straight at it and said, go watch this right now. And when they landed there, they landed on five 20-minute episodes.

1:43:33If you make it through all those episodes, it's 100 minutes of watch time on a brand new channel. We actually got flagged or something. YouTube thought we were like – We were spamming. We were spamming. Yeah, because of – And they like tried to demonetize the channel. There were like problems early on because YouTube's like internal systems like couldn't handle all of the watch minutes that were suddenly flooding to this new channel. But we also took the opportunity to point people very specifically to videos in that watch journey and we plugged them in at different places. So the film theory that we had that week pointed straight to the episode on style theory about Hulk's pants.

1:44:08We did a Marvel episode on film theory. Hey, you're watching. Wow, you like this Marvel episode. Hulk's a Marvel hero. Go check out his pants. Boom, there it is, you know? And so again, you're creating these, you're creating all these synergistic hooks of watch you over here, drive you here. Watch you over here, drive you over here. It just has to make it easy for people, right? Video to video relationship is one of the most important things on YouTube. Yeah. I think we found that like sometimes, you know, like sometimes we'll make a video with the creator and then they'll put out a, you know, a big video six months later.

1:44:39Yeah. But it'll, there'll be a connection, right? And then that, the interview will, just immediately boost because there's like a connection of an unbelievable amount of suggested traffic. And so I think the best example was we interviewed Ryan Trahan right before he went out on the penny series. Yeah, sure. So it came out in the midst of it. Yep. And there were 30 plus videos that could recommend. Yeah. Yeah. Here's this episode of him talking. Fantastic. Absolutely. That's amazing. Suggested video is the such a powerful force on the platform, which is also one of the reasons why YouTube in 2023 is hard.

1:45:10Right. Again, going back to the idea of screen real estate becoming more and more limited as YouTube tries to make two platforms, two pretty distinct viewing experiences work on one platform, you know, with shorts and with long form that you've seen suggested video kind of be in this unstable state and kind of like in this state of flux right now, which is interesting. Suggested video is getting put into question with connected TV viewership. Yes. Right. Because like we last year, 30 % of our viewership came from connected TV. Oh, that's great. The watch time is longer on TV. CPMs are higher on TV.

1:45:44Yes, 100%. Congratulations. That's a win. Thank you. Thank you. But like I was watching some of your guys' videos on Connected TV. Well, thank you. Thank you very much for that. Yeah, you're welcome. Is that still your AdSense? What? No. I mean, no, but thank you on behalf of Lunar. Generally. Thank you on behalf of our corporate organization. Yeah, yeah, yeah. No, but I think, and again, it's a partnership, right? We are still giving our best work to them. Of course, of course. But anyway, yes. Anyhow, revenue. the revenue speaking of connected TVs and high CPMs yeah but the revenue pie chart I was just bragging about the fact that he has time to watch TV and I'm like oh man that's great well I'm watching TV in the context of researching for the interview it's 100 % work-life integration integration right there it is so like what was the revenue of the company when you went out like and you're doing in the diligence phase you know you're like showing them here's here's how we make money yeah is it like majority AdSense Is it brand partnerships?

1:46:40What does it look like? I think it has a similar breakdown to a lot of channels that you guys have probably talked to. I think like, you know, you read on a while back. And I think we followed a very similar path to a lot of other channels in the space just in general. The only thing that I think is weird about us is that we have had a real under-reliance or, you know, we have never overly relied on brand integrations in general. Interesting. Our AdSense is a big chunk, right? Yeah. We are in verticals that have typically monetized pretty well. And we are, you know, typically on the more premium end of what just happens to be out there.

1:47:19And so - And longer videos. Yeah, longer videos, all that kind of stuff. So, you know, AdSense is a good chunk. And AdSense and brand deals are definitely the top two sources, right? And together, you know, they're the vast majority of our revenue. Now, we've had some really good plays this past year into product. And so that rate, that pie is actually shifted so that product takes up a much bigger slice than it has in the past because we've really focused in on that strategy. But if you think about, you know, the typical AdSense being between, you know, 40 and 60 percent of revenue and then brand deals being like another, you know, 25 to 40 percent, just depending on the time of year and the channel.

1:48:01Right. So we're like in that same ballpark, I think, with a lot of other channels out there. but we're also in four different verticals, right? So some of them do great on the AdSense front and might be a little bit harder to score brand integrations for. And some of them like clean up on the brand deal front and might have like a slightly lower CPM or might have a more volatile CPM. The actual fascinating thing about it too is, and again, it's kind of like having a diversified portfolio, which is fantastic. Like in 2023 alone, I'd say outside of style theory, but every other channel was the top earning channel at some point during the year, during one month.

1:48:37So for the vast majority of the year, it was Game Theory because Game Theory always tends to be because it's the oldest. It's got a huge back catalog, right? It's a huge back catalog. Great, right? So for Game Theory was that for a lot of it, but Film Theory surged for about like probably three or three months, four months or whatever. Then Food Theory actually dominated throughout the summer months, which was shocking to us all and really took off. And then towards the end of the year, GT Live, you know, our little engine that could, the little live stream channel, just surged out and bested everyone.

1:49:08And so the great thing about that is you really do see this like distributed risk across all of them, where as one rises, another falls, and as one falls, or sometimes they're all just firing on all cylinders and it's great across the board. I think it's kind of interesting that you guys made channels that are equally hard to produce, right? Because a lot of creators go like, their second channel is a Reacts channel. It's supposed to be easy. this one's supposed to be easier but you went this is hard let's make another one let's make it all hard it's actually 4x how hard this is no totally yeah because that is because that I feel like is what eventually happens is like again you make the Reacts channel it's like okay this is easier to produce and it's doing a million views or you know three million views and that means the margin's higher over here that can fund this thing yeah that would have been smart you didn't do that clearly you figured something out you're doing 11 in a week right some sort of process A lot of manpower, a lot of talents, a lot of passion.

1:50:07Yeah, but I think like the reason for that wasn't because we wanted all the channels to be hard. It was actually because originally, if you really, really go back to it, is because we thought that one channel wasn't just going to survive, right? So when 2015 came around and Game Theory had been around for four-ish years, we were like, okay, well, you know, this is YouTube. The maximum lifespan of a channel is five years. So we got one good year left. So let's launch a new channel. Let's launch a new channel. As one kind of crests over the hill, like, let's launch the other thing. So that way this one is now the thing that's carrying forward.

1:50:40Well, this one kind of goes down. How funny. Right. But lo and behold, it's like, but we kept it alive. And it's still going and stronger than ever. And so it's like, well, okay, well, cool. And then food theory, we wanted to do food theory for a long time. But it was one of those things where we just needed the manpower to do it. And we're like, well, let's launch food theory because these other guys are getting kind of long in the tooth. And, you know, like maybe creatively, it's starting to get a little bit hard to find things or whatever. Food theory, like, oh, my gosh, there's a burst of fresh air.

1:51:06And also everything else continues and thrives again. And so it's on one hand, it's did we anticipate having like five channels and all of them being very difficult and time intensive to produce? Yeah. No, I mean, no, we didn't really. Because we built them in a way of like, oh, well, when one goes, the next one rises. Got it. But then they all just lived on. And it's like, oh, well, this is great. Woohoo, success. What are you guys' roles right now at Therese Media? And how long are you going to do those roles? What a great question. What is our role? So, okay. So... Why is this a difficult question?

1:51:45So Therese has an org chart, right? We have a piece of paper that says... You're just a couple that lives in the office. I mean, kind of. And our son has 12 best friends who live in the basement. We're the landlords that awkwardly live. the offices. So there's this org chart, right? Yeah. And it has everyone's roles and the editors report to this person and the writers report to this person and the creative directors and all that stuff. And we are not on it. You're not on the org chart. We're not on the org chart. We are kind of like floating bubbles. So there's the org chart and then there's a circle around the org chart and we are these like little planets in orbit around the org chart.

1:52:23And so my day-to-day existence, I can't speak to whatever the heck you're going to be doing after you're not hosting all the other four jobs that you have. I was going to say, right. But when it comes to what I do is like I might be in any part of that org chart at any given time and I'm in like five of those places at once. Got it. But at the end of the day, my primary objective is being the one to say, okay, where are we going in a year? Where are we going in two years? What are we supposed to be accomplishing right now in the bigger picture? And that's why I was the tip of the spear for our acquisition.

1:53:00And that's why I was the tip of the spear for the, you know, all of that research for the style vertical, all of watching all of those videos, all of defining what that space was. That was that was me. Right. And so I'm behind a lot of the stuff and sort of the foundation of a lot of the stuff that our whole team ends up building, which is really cool. And then and then me, meanwhile, like on paper again, like I'm still CEO. I'm still listed as president of the company. But really what I function as is chief creative director. You know, again, like if they're all kind of like their own. Chief creative director.

1:53:37The CDD. Yeah, the CDD. Standard CDD. The standard CDD, yeah. Classic CDD, where if you have kind of these creative directors who are learning how to be YouTubers and get control over the whole production process and the creative and they're leading their individual channels. I'm then kind of like brand supervisor. I'm helping to supervise them and, you know, give them advice and weigh in on programming and serve as a mentor and a coach to them and a support network to them. When it comes to, hey, how are we – how are you communicating with the editors? Are you getting what you want out of them?

1:54:12Like how is that relationship happening? How do we work on the writer's, you know, portfolio? And how do we, you know, make sure that we're there being trained up and learning what is a theory and how do you write that? How is programming? Let's learn about that. And so really as the elder statesman of theorists, my job at this point is making sure that the video production and the creative pipelines are running smoothly and cleanly and communication is still going on. And so that way, again, I'm functioning as the audience. I'm representing them and telling the creative directors how to continue to relate to them in a way that makes sense and feels appropriate.

1:54:51But also to Lunar where it's like, hey, Lunar, this is our business. This is how we work. This is what our audience stands for and who they are. And so as we pursue new projects like fashion shows and video games and new theory wear lines and things like that, this is how we – this is what feels theoristy. This is what feels appropriate to them. And this is the sort of stuff that we as a collective can be excited about moving forward. Is there a moment where you're fully out? And is that planned or is it just like not? Are you ever fully out of YouTube? YouTube is always with you. It's always in your heart.

1:55:28I guess not fully out of being on YouTube. It's with you, Tony. It's probably with you forever. Like a virus. Like are you hiring a new CEO of Theorist? Are you working towards like actually? being out of this business. I think there's a world where, you know, there are other people who can rise up and take over our responsibilities, you know, because we are nebulous and because we are there, you know, and there are people in our company who are ready to take on those responsibilities. And I think, you know, with a bit more training and with a bit more practice could very well take on those, those roles.

1:56:07Right. I think it's really, I think there's like a lot of hubris and being like, no, I'm irreplaceable. No one can ever replace what I do. And I'll never be able to leave because of like, that's, that's, first of all, who wants that? Like the best thing that you can do for yourself and for any company that you work for, and this goes with like anybody is make yourself replaceable, like find ways of taking bits of what you do and carving them off and training someone to do them as well or better than you can. Right. And eventually you'll have taken a lot of, a lot of the parts of what you do and, and you'll have been able to empower somebody else to do those.

1:56:45And that's, that's a pretty amazing thing to, that's a gift you can give to someone. Like I mean, in reality though, right? Like there is always going to be a moment where we move on just because, you know, I'm not going to be a 70-year-old still managing the same YouTube channel, right? I mean, maybe, but like – It depends on how big this thing is. Hey, fellow kids. Hey, fellow kids. Here we go. There's like a succession narrative here, right? I mean – Like, you know, you're running like this massive media company. Right. Hopefully the people who are taken over aren't as terrible as that. I was going to say we're not passing this on to our kids.

1:57:15They're like comments. They were like, well, they could have just waited until Ollie was a little bit older. And then like past the YouTube channel. And then I was like, I wouldn't do that to him. Poor guy. But I made mention of this. Here you go. There's 40 million subscribers. There you go. This is my legacy to you. I know you're just getting into sophomore year of high school. Good luck with the acne and the YouTube channels. But I mentioned this earlier, but like at the end of the day, you know, we love learning. You know, I think this is one of the first things that we said as a part of this is like we thrive off of learning and challenging ourselves.

1:57:49and there's there was this truism in theater where like when i back when i was in theater like if you could do anything else don't do theater uh because it's it's thankless it's it's a pretty miserable experience you're out of a job every three months like even if you're working like it's it's it's a tough business to work in and you know and i was able to find happiness outside of theater and i think for steph and i you know you you look at youtube and it kind of functions in a lot of the same way right where it is this like you said it's it's this all-consuming thing that you're constantly inundated with and you're constantly absorbing and this and that.

1:58:21And we just by the nature of who we are and our intellectual curiosity and stuff, we have other interests. I think that's what's helped the creative of theorists work so well. But I think like, you know, I love rock climbing. I love I want I'm teaching myself how to ice skate right now. You know, I want to there's a whole back catalog of books that I want to read that I've never gotten to read before because of how much time is taken. And hopefully on the other end of this host transition, I have the time to do that sort of stuff. And we're very unhealthy. It should be stated. Absolutely. We don't live a particularly healthy lifestyle, right?

1:58:53There are – like life is a balance, shift your weight kind of thing. There are shifts that can happen here where we can pursue other things that also make us happy in addition to YouTube and find ways of pursuing those. And those make you a better rounded person but can also make you better at business. Are you talking about fun? Right. Well, actually, we're talking about happiness. Oh, yeah. Sorry, the other thing. And I think this is – Stephanie read this very influential blog a long, long time ago. It was unbelievably impactful on my whole life. Are you ready for it? I don't think anyone actually likes this when I tell this story.

1:59:35So, sorry in advance. No, I think it's – I like this story. I'm prepared to be underwhelmed and unattracted. Yeah, great. I mean, maybe I can tell the story. and then maybe it'll be better. Do you know that that's happened? Okay. So, so

1:59:59you tell the story, then you tell the story. Choose the best one. No, this, that's what Matthew is doing is a callback to many moments that we've had, but one moment in particular that always like burns into our memory from VidCon where, um, this was when I was not, it was really wasn't known that I was helping with this, with the channels that I was part of the business. It was back in the days when there was one channel, one face and YouTube only invited one person to everything because it was like, if you can't be a YouTuber and have anyone else work with you ever. Um, but we were, we were at VidCon and we were talking to, um, you know, an industry big wig.

2:00:36Um, and I said something to them and received absolutely zero acknowledgement. Like it was as if I didn't say it. And then a couple minutes later, they turned to Matthew and Matthew knew that I had just said this thing. We were standing next to each other. It wasn't that hard to hear me. And he said the exact same words, literally the exact same sentence. And the guy was like, whoa, what an amazing idea. That was incredible. That was amazing. And so we have a running joke sort of about this instance a good solid 10 years later. Anyway, tell me your story. Okay. Okay. So, the opposite of happiness.

2:01:18What is it? What's the opposite of happiness? Sadness. You would think, right? Wrong. Wrong. You've been lied to. Unhappiness, whatever. Whatever it is, it feels like this moment right now. Oh, no. That's the impression that we've left them with. I mean, you know. This is why people don't like the story. I wouldn't have quizzed them and made them feel bad about an impossible question. I feel like I got set up. Yeah, you were. I'm sorry. So this idea posits the opposite of happiness is not unhappiness. The opposite of happiness is interestingness. And it comes from a study that was done in the early 2000s where you interview a bunch of people who some of them have really high-powered jobs where they're traveling a lot.

2:01:59They have unbelievably hectic, busy lives. And some people have very, very predictable suburban schedules where they don't do very much and they live in these sort of small towns and stuff like that. You interview these two sets of people. the people with the really high-powered careers who are going and coming all the time, they describe their lives as extremely interesting and mostly unhappy. And you look at the other set of people who have a very predictable life. They have a very normal, average kind of existence. They describe their life as not very interesting, but pretty darn happy. And so you have this spectrum that doesn't go from happiness to unhappiness.

2:02:36It goes from happiness to interestingness. and the more interesting your life gets and intense and crazy. And you recognize like, wow, my life is super interesting right now. But most of the time on a day-to-day basis, you are not very happy. And it's about this idea of where do you want to sit between the spectrum of happiness and interestingness at different points in your life. And we have pushed ourselves for the last 10, 13 years so far in the direction of interestingness. And on a day-to-day basis, we're like so stressed out. most of the time, right? And at this point, we can move somewhere else toward the happiness end of that spectrum, right?

2:03:18Maybe a little bit less interesting on a day-to-day basis, but maybe a bit happier. I love that. And I think you did a great job. You're not going to top it. I got, I mean, I don't think I can. But that essentially suggests that happiness is connected to simplicity, right it is right and i think that like it takes a lot to realize that and i don't know i wasn't someone who believed that i was like yeah you get out there you do all this amazing stuff and you're going to feel so satisfied and accomplished and you do and that's the thing i think i feel really satisfied and accomplished with a lot of the things that we've done but i think about my happiest moments and they're absolutely some of the simplest super simple yeah i mean i mean if you think about it right like even take the example of a sports car right like a high-end super powered sports car All of a sudden, you have to worry about the maintenance of it.

2:04:08You have to worry about like, oh man, if I take it to the store, I need to park it far away because someone might dent it. The streets are too bumpy and so it might bump – the car insurance is expensive. Like I have to run the engine at a certain rate because the engine doesn't function on like 25 mile per hour roads. Like there's a lot of stresses that come with the interesting and exciting thing of having a sports car, right? Whereas, you know, if you simplify it and go with just kind of like the happy option of like, hey, I have a car that runs well and I don't have to do extra maintenance for it.

2:04:41It's totally fine. That's perfect. Like there is a beauty in the elegance and simplicity of normal everyday life that allows you to put away a lot of those stressors that come with being interesting and pursuing an interesting lifestyle that allow you to just have happiness. In other words, mo' money, mo' problems. Mo' problems. Yeah, wise man once said. Right. Wise man once said. You know who's really good with this is Ryan Trahan. Mm-hmm. I always say if there was one YouTuber I could be, it's Ryan Trahan. Yeah. Like, I think he has found this amazing space of simplicity. He has a small team.

2:05:17Oftentimes, he's filming with just himself and an iPhone. He can, you know, I remember I think he told us he edited a video on the plane ride back from shooting the video with his editor, Zach. And like, it's a very simple setup they have now. And he's been able to excel in that simplicity. And I really admire him in the way that he's operated in a world of pretty complex desires on YouTube now, right? Like YouTube has become a place of complex desires. Yes. And I'm curious your perspective. I know you've talked a lot about the eras of YouTube and just this premise of being a YouTube creator and what it means in 2024 is so different than what it used to be.

2:06:00And I think these are connected conversations, the conversation around like interestingness and happiness and simplicity. So I'm curious your perspective on YouTube today from the elder statesman vantage point. Do you want to adjust your cravat? No, I think we're in an interesting era for a lot of reasons, right? We are definitely at the turning point of a new generation of YouTube, absolutely 100%. and it's on account of two things, right? I think Ryan Trahan represents a lot of what this new generation is, which is a swinging of the pendulum back. You know, for the last, what, three years or so, you know, everyone's talking about the Mr.

2:06:36Beastification of YouTube. I think, you know, it wasn't just Mr. Beast. There were a lot of other factors, but he was definitely like the point of the spear in a lot of that, where productions are bigger, expenses are higher. You know, we did a video about this towards the end of last year, about the era of excess. You know, like everything has to be the biggest, the most. I did everything, right? And Ryan Trahan represents that but to the complete other end, which is I took it down to a penny. I did this simple thing, you know, and it is that simplicity. And I think what you're seeing is kind of that swinging of the pendulum back towards embracing that sort of simplicity, that relatability, that human connection that really was foundational to the success of early YouTube in a lot of ways.

2:07:19Concurrent to that, I think you have, again, I've made passing mentions of it, but that the role of shorts on YouTube and the influence of TikTok on audience attention spans and production value, right? Where as shorts continue to take over more and more of the feed and as TikTok continues to take up more and more of audience attention, people are loyal to the platforms rather than individual creators. You know, when everything is just a like, let me scroll, let me scroll, let me scroll. Haha, that was a funny video. move on to the next one, you don't appreciate who was the person who actually made it, right?

2:07:53Like when you talk to people about TikTok, they're like, oh, did you see that funny TikTok where? The guy did this. Yeah, the guy did this. But who was the guy? Yeah, who was the guy? And they're like, oh, I forget what his name was. And they have to, maybe he saved it. They have to dig back through it. Or they can never find it again. Yeah. Or it's just gone. For me, I'm like, I can never find that again. I will never see this. That's exactly right. And so everything is this like passive watch experience where you're loyal to a platform, you're loyal to the feed, but you're not loyal to a creator.

2:08:19And it's very hard for a creator to kind of like put their stamp on that video and stand out from that crowd, right? You were talking to somebody else. I think it was like a, I think it was a round table video that you guys did before the streamies. Oh, it was Michelle Correa and - Yeah, yeah, yeah. I think, yeah. Yeah, and a bunch of other people who were talking about how there are, it's really hard to, like how they see a lot of trending videos from this past year, but not a lot of exceptionally growing creators. There was a comment like that that really resonated about that. And I totally agree.

2:08:55I think that's a great way of putting it where, yes, lots and lots of trending videos, an individual video that's like 200 million views and not as many of those like creators, especially this sounds like a bad way to put this, but like middle class creators, but like creators who are on the rise or mid-tier creators. mid-tier, that's us. That's an inside joke that we're probably going to have to get. I know. Too much context. I was like, do I explain this? Call back to a 2018 video. Don't worry about it. But that chunk of creators in there who, again, have small teams who aren't interested in necessarily being everything for everyone, but are interested in kind of staying in their lane and doing a great job of it.

2:09:41I'm seeing less of those or like just maybe not as, as many as I would have expected. Um, and I think that, that comment really summed it up really well. People are chasing that the big video, like in the video conversation of the week, um, and maybe overlooking the, like, what does this look like in three years? Like, what is my, like, we talked about this before we started recording, but we always think about formats on a 52 week cycle. Like what does 52 weeks of this look like? Um, yeah, I think it's, but I do think it's swinging back. There's a lot of lo-fi kind of stuff working, which is interesting.

2:10:14It's not necessarily that it's taking over, but there's stuff working that's lower fi and even long form podcasting is something that's interesting. People are I just want to see what happened in the room. It's either super short or super long, but that kind of like middle era is tough to come by at this point for sure. Is there anything that you would do to change YouTube to make it a better place for creators? I would have broken out shorts into its own separate viewing experience to be honest. Into a separate app. Yeah, into a separate app. Yeah. I think you are trying to create two different watch experiences on the same platform and the way they operate are fundamentally different from each other.

2:10:57One is a passive scroll that gives you those quick hits of dopamine and are funny and it's like good discoverability for a lot of smaller tier creators and it's... Or bigger tier creators. Or bigger tier creators. Yeah, or anyone. Just a lot of discoverability. My concern is always just that it threatens the viewing behavior. Correct. The viewing behavior of YouTube is so unique to YouTube. Exactly. And people underestimate the value of the channel page where it really, when you break it down, YouTube is a large website with a lot of smaller websites on it. And those smaller websites are called YouTube channel pages.

2:11:25And so when I go to look for a Colin and Samir video, I type in Colin and Samir. I know who you are. I know what you are. I recognize your thumbnail. Your brand is everywhere. Your brand is in the title. Your brand is how you thumbnail. Your brand is, you know, the content that I'm getting. And so I like everywhere you go on YouTube proper, like long form YouTube, that brand exists in shorts and in any sort of feed based thing on TikTok either. There is no thumbnail. The title is hidden off to the corner. Your brand logo is off in the corner. I better recognize your face and your microphones. Yeah.

2:11:57I mean, even if you look at VidCon from this past year, as you looked around the creator hotel, the amount of people in kind of over the top, brightly colored, wacky outfits. was through the roof. Did you guys see this too? Did you notice that? That's interesting. I mainly just noticed that we talked to Hank about this, but like someone would come up to us and say hello and say they liked our stuff and we'd be like, oh, thanks so much. And then we'd be like, and what do you do? And they're like, oh, we're a TikTok creator. Oh, okay, cool. And then we'd look them up and they have like 15 million followers and you were like, that was the crazy thing.

2:12:31Everyone was famous and no one was famous. It was like, and fans are creators and creators are fans. And everyone was just everything. And I was like, VidCon used to be, there's a couple of celebrity creators and everyone else is there as a fan. Yeah. Yeah, anyway. But it's very hard to stand out. The wacky outfits. To the point of the wacky outfits, yeah, no, I think that's what we're talking about. And I think, and the reason why, you know, or at least our theory, our game theory, I had to do it at least once, I'm so sorry. Man, whenever you say that for the rest of your life, huh? Constant, yeah.

2:13:00Uh-huh. You have to do the bit to yourself. I am legally required to do it. I'm so sorry. And then apologize immediately after. And then you have to pay a royalty. Royalties back to Lunar X. corporate overlord lunar x um no but it's one of those things where our theory is the reason why the the crater hotel looks so different this past year is because you need a visual thing to stand out immediately as you're scrolling through it's like oh that's the person who dresses like they're from good burger or oh that's the person with like the neon green tutus or whatever and i don't necessarily know who you are but i immediately within that split second of me flipping i have that moment of visual recognition because there is no thumbnail.

2:13:38You know, it's whatever the first frame of your video is. There is none of those other branding things that you trust on YouTube. And so for me, if I were to make that one small change to YouTube, which isn't that small of a change, but I would have broken the two out and still have them talk back and forth to each other in some way, you know, be able to link between one app and the other app or maybe there's long form connections there somewhere. But, you know, do it in two separate watch experiences where the screen real estate one isn't cannibalizing the screen real estate of another one. I think they're actually maybe planning for the mega, like the very long term of connected TV versus mobile.

2:14:17Yeah, I mean, maybe. Because we've said this before, but they have us on both at one time. Sure. The amount of people who are probably watching connected TV and also scrolling shorts, that means now you just doubled your watch time across two products, right? And so that could still happen if it was a separate app, But I imagine it would be much more challenging to bring people over to that other app. Oh, no. Right? Like, it's just. I mean, it would be. I understand the case from them. Oh, sure. I understand why they did it. And I also, and here's the thing. I think we have like a good amount of faith in YouTube.

2:14:52Like, we're like fans of the platform. We like YouTube. And it sustained us and allowed us all to build careers for over a decade. 100%. Which is pretty substantial. I think where you get into some trouble is when there's so much going on on the back end of YouTube and YouTube doesn't understand it. Right. I think there are a lot of unintended consequences that happen when YouTube tests things. Yeah. And the only way to test them a lot of times, this is not their fault, but the only way to test them is by using people's real channels and real income and real employees. Right. And if they've made a miscalculation and if they haven't really thought through how the shorts feed actually cannibalizes long form or vice versa or whatever, there are unintended consequences in their fallout.

2:15:34But those are real people that are in the fallout, right? And I think there might have been a case of correlation versus causation with YouTube in a lot of ways. So obviously shorts was a very strong reaction to TikTok, right? Where like, oh man, TikTok's eating our lunch. All like TikTok's the new hip thing. And all the kids are on TikTok. And YouTube is now the old man in the room. Just like YouTube swooped in and took the audience away from traditional media, here's TikTok in that same role now with old man YouTube, right? And I think they saw that and panicked. And they're like, how do we get the young people to make YouTube hip again?

2:16:11How do we get the young— Oh, no, the youth. Yeah, how do we get the youth onto our platform, right? But I think what they underestimated was the reason why TikTok was so exciting for these people. It wasn't necessarily one minute videos. It wasn't necessarily like a vertical scroll or things like that. What it really was was a lower barrier to entry. Of course. You know, it was that idea of in order to find success on the platform, it could just be me on my phone, you know, and I don't need this big production where I buy every single Barbie dream house and then review it for the next hour. Which is a great video, by the way.

2:16:44Which, which, I hope, it's a fantastic video, but also like it's difficult for a small aspiring creator to do, right? You know, I don't have a big team. I don't – or even as a viewer, right? If I'm a kid in school who wants to watch a digital video, I don't have a half hour to 45 minutes to watch or three hours to watch a Colin and Samir podcast, right? I don't. How's your middle school demographic? Is it pretty good? This has got to be big in middle school. Huge. We're popping off, boys. Let's go between Mrs. Smith's geometry class. but it is it's one of those things where the platform and the algorithm because it was so optimized for long form long form satisfaction long time watch time you know all of that stuff you lost a lot of what founded YouTube in the first place which was short popcorn viewing videos you know one minute two minute three minutes that you could watch and share easily and so there was totally an open space in the market for that and hey TikTok did a great job of finding it isn't it funny that they're now they just announced 30 minute upload time on TikTok Well, because everybody's got to go Everybody's got to smush in each other Everyone has to steal each other's Because also, I mean, the clock is No pun intended The clock is ticking on TikTok in terms of Making creators money through something other than brand deals I think you intended that joke I think that pun wasn't I'm just calling Stephanie out That was an intended pun So, in a year like 2023 I think, Reid, again We saw the night letter that went out at the end of 2022 being like, hey guys, buckle up, don't buy the Lambos next year.

2:18:14It's going to be a rough ride. And we're expecting brand deals to be harder to get in 2023. And lo and behold, they were, you know, generally a bit harder to get, not in every, not in every vertical, right? But there was, there was some uncertainty in the marketplace, right? And, you know, I think Knight has made no bones about this. When they sent out that letter, they were like, you know, this isn't - You're talking about Knight Media run by Reed who manages Mr. Beast. Sorry. Yes. I just want the context. context for this. So when managers in the space have been concerned about the financial stability of creators this year in general, those concerns haven't necessarily been targeted at operations like ours or like yours.

2:18:55They've been targeted at short form creators and TikTokers who rely very heavily on brand integrations. And if those go away, it's like one revenue stream, right? One. Single revenue. Single. And maybe you have merch. Maybe. Maybe you have a product. Maybe if you're the D 'Amelios. But probably not. If it's just sponsorships and there's one bad year, that can crush you. And so TikTok is in this position where they, I mean, they know that. And yeah, of course they're going to try and create longer form opportunities for people to bring in real ad revenue. Right? And now they've got, what, Twitter to contend with, I guess?

2:19:29Where do you think, okay, do you guys watch sports? Every once in a while. We dabble. We dabble. Yeah. Do you know who Derek Fisher is? Derek Fisher. Yeah. I've heard the name. Please refresh me. Old school Los Angeles Lakers player. Okay. I grew up watching. Yeah. I became the head of the NBA, like, Players Association. Yeah. Like, essentially, the Players Union. Sure. I've been very curious, as, like, this crop starts to age up. Yeah. What happens to someone like, or people like you guys? It's like, do you become the Derek Fishers of YouTube? Right. Cause like you have a lot of perspective. I remember listening to, uh, listening to one of your videos.

2:20:12I don't remember, maybe it was about shorts or maybe it was about the$1.7 million loss. So when you're talking about defy and I was like, you speak with a kind of a political cadence at times. And I was like, do you, is there a world where you like, what, where do we all net out? Like, is there like a, there's been attempts at creator unions. I don't believe those can work because I don't think we are talent in the same way or we're not like – Talented full stop. Yeah, yeah. But we're just not – we're not actors. Just a bunch of haps in here. Would you ever like go into YouTube and work at – like does one of us become the CEO of YouTube?

2:20:49You know, honestly, like it is one of those things that as we look towards what is, you know, next steps for us. You know, like if there is that period of time where it's like, hey, Theorist is off to college and we have emptiness syndrome and we want to do something else, you know, let's work on another project. There's always been talks about us, you know, doing that. You know, either, you know, hey, maybe we do want to step in at YouTube or maybe we do want to work on some product. Like our thing has always been try to help uplift other creators and try to help make digital media a more viable, accepted, respected platform.

2:21:28You know, because we all see it, right? We all are, you know, the creators and the brands of the future, you know, and we are the production studios of now, you know. And it still boggles my mind that traditional media refuses to acknowledge that and to have – That tide's starting to change. Starting to, but – Yeah, because it has to. Because they've got nothing else to talk about, right? Like they have to. Yeah. But, you know, if instead of being scared of that, you know, there should be someone or people to kind of help mitigate those sorts of things. So for us, you know, it was very important during my tenure as hosts of the channels to serve as kind of an elder statesman or as like a state of the union of YouTube to equip creators with the knowledge that they needed and to talk to YouTube who might be listening and creators who are listening about like, hey, this is the ecosystem as it currently exists.

2:22:17We get a lot of emails from YouTube employees after like a meta video goes up. After like we write a video where Matthew rants on the couch for 15 minutes, we get a lot of emails from YouTube being like, we passed that around. Like everybody watched that over here and oh, that was really interesting. You know, we know that that stuff gets seen and that's so cool. How cool is that? I know for a fact that like Susan Wojcicki saw most of the meta videos that we did and or her assistant did a very good job of informing her. Right. Whatever. And like that's that's so cool. And it would be a shame to lose that entirely or to just take a step so far back that we don't get to participate in any of that.

2:22:57We've, we're already actually in talking about, um, you know, creator advocacy at the, um, like at the state and national level to create business parody for YouTubers to make sure that they have the same rights as other media companies, the same tax breaks, the same, um, the same, uh, like employment laws, because a lot of that stuff has been left in this like weird gray area because no one has taken the time to articulate it to, you know, people who are real decision makers in policy and things like that. And we're getting to that point in the industry where that stuff is now possible. And, and yeah, we're actually like, we we've already been in meetings about that for the last year to talk about being effective voices in that space.

2:23:41And it's pretty cool. And other than that, I think creator advocacy is, is it's awesome, right? How, like how fortunate do we have to be in life in general to be in a position where we're like, okay, money is not our most limited resource at this point. And once we get a little bit more time freed up on the background, then time is not a super, super limited resource in the way that it is right now. And then we can turn our attention to be like, well, if we have that kind of freedom, we should be advocating for other people to have it too. And that's, I mean, how awesome is that? What an incredible privilege.

2:24:20This is not really where we are in the conversation, but can I ask just a data question. Sure. Just about the type of data we should care about. You have this great quote that I pulled that was about explicit versus implicit data. Yeah. And that YouTube has so much more implicit data right now. They don't need you to like a video. They don't need you to subscribe. They can understand your behavior without you having to take an action. Yes. I thought that was really interesting. And I'm just curious for creators in general, like data has become a big conversation. We have a lot of data at our fingertips.

2:24:51What do you think creators need to care about when it comes to data? I would say, I mean, it's interesting because over the course of this past year, the algorithm has shifted probably every two to three months as YouTube has tried to figure out where shorts fit in and what the right cadence is there. So there have been a lot of metrics that have been shifting and pivoting, and we've seen that reflected in the data over the course of the last year. That data comes from the fact that we've had a lot of discussions about that particular quote, comes from the idea that we've had a lot of conversations about subscribers not being a metric to look at.

2:25:25Right. Right. So subscribership is not it is not something that YouTube needs anymore. I don't think I think it's just there so that people can click a button and have a and have a bookmark and yeah, and click playbooks. But at the end of the day, I mean, like priority number one is average views per video. So that way you can see like, hey, I didn't it wasn't just a one off, but it was a I I'm building a sustained audience. And even though the next video might not have done well as the one that popped off, did I gain more, not subscribers, did I gain more regular viewers off of that? And are you looking at returning viewers versus new viewers?

2:26:00Yes, exactly. In that average views per video. Exactly. You're like VPB 30 views per video over the last 30 days, over the last 90 days. What we encourage a lot of our team to do, anyone who's in the data regularly, is take a close look at what's happening right now and then very regularly, like almost with every upload, zoom out. like zoom out, zoom out, zoom out. And remember to your point earlier, you're planning a 365 day a year programming cycle, zoom out. Where are you in that cycle? Right. And if you're not understanding the wider context of your data, you're missing the opportunities to actually spot the trends.

2:26:36Right. So I think that's one of the things that our team, it wasn't intuitive for them to necessarily pick up immediately because they were very focused on how did this week's video do? And we're like, well, okay, this one did fine, I guess, but without understanding how the last 10 videos did, you don't really understand how this one did. And if you don't know how we're trending for the year, you don't know how this video did either. Well, and I, and I think, so on one hand it's, it's that zoom out mentality, but I would actually counter and say, go into each piece of content with a goal and with an, with a purpose, a KPI, you know a kper for your kpi um it's it's this idea of kpi means for the young oh yes for the youth you're sorry your key performance indicator yes like your goal what are you tracking what's your goal yeah man we're dropping all the all the words here but but yeah so so what is your goal because i think a lot of creators just upload videos with a vague idea it's going to do well Yeah.

2:27:34Right. Oh, it will get views, you know, or maybe it'll monetize. And what we found is that no one piece of content can do all of those things. Right. It can't it can't be satisfying to subscribers and get you new viewers and also get a lot of watch time, but also maximize CPMs and this that different pieces of content work differently all the time. And so what we always recommend is if you're, you know, take our channel, for instance, we have our wheelhouse franchises of like indie horror, you know, on game theory. But maybe this week we're going to cover Fortnite because it's trendy and it's not in our audience's wheelhouse.

2:28:10Let's see how many new viewers. This is a play for new viewers. We want to bring more new viewers onto this video because it is not in our existing audience's wheelhouse. And so we do it and then we look at see how many new viewers came over off of that video and also how many subscribers we got off that video. It's an antiquated metric, but it is a metric that is relevant for that specific video. And then you go to like, hey, we need to we want this video to be to kind of maximize watch time. You know, the last couple of videos have been short. We want something that's a little bit more narrative.

2:28:43We're going to stretch the retention time. You know, let's let's get people to watch longer sessions. let's look at that retention time graph and let's see where the peaks and valleys were or hey we wanted to run an experiment in the middle where we told people to go back and rewatch like did that work how did that work and so for us each video is an opportunity to experiment and to achieve something new with your channel and it's an opportunity to learn and that over the course of 13 years we have done that over and over and over again week over week over week over week 44 videos a week or whatever from a month and you by doing that you get such control and such power over your programming and over your content that you then have a really good sense of, hey, if I need an audience booster, I need to dip into this type of content.

2:29:27Or if I need to get people to click on that link at the end of the video or click on a sponsor link or whatever, I know based on looking at the data and the tests that I've explicitly run, that that is, you know, I need to say X, Y, and Z, and I need to frame it in this way. Yeah, but the point is that you can't test everything on one video, and one video can't achieve everything. You can't have an experimental video that also activates the wheelhouse audience and drive subscribership, whatever it is. There, there has to be, you can only measure a video's success if you know what the goal of the video is, right?

2:29:59If you don't have an end in mind, you don't know how you're going to get there or if you've gotten there. Yep. And it's not always just one out of 10, one out of 10. Right. Exactly. No, I think, I think that's, and the people we know, I'd be curious about the people you've interviewed, the people we know are very split on that as the, as the first thing you see when you log into analytics, right. Is the, is the ranking because I mean, even for channels like ours, that can sometimes be very misleading. If we're intentionally doing an experimental episode, we know that that's not going to be the biggest view getter, but that wasn't the point.

2:30:32Cause that's not what we're testing. And so that's not a relevant thing to see, but it is hurtful to be like, Oh, six out of 10. Like, you know, it's a gut punch. Yeah. It's a gut punch. And so we know people who are like, oh, that's really helpful. And I think for the most part, we find it really pretty helpful, but we know people who hate it because if they're not setting out to necessarily get the most views on every video and that's the only thing they're testing, then it's, it totally throws your game off. We've had two out of tens that 60 days later, way underperforming to what was maybe a six or seven out of 10.

2:31:03For me, it's just AVD. Because what we're making is extreme long form. Sure. Absolutely. So like when we see an AVD in the 40 to 60 minute range, we're like, oh, people are in. Yeah. People are in. Yeah. Right. They like it. Totally. If you start to see it dip in the 30 minute or 20 minute, because we're pushing, you know, two hours. Yeah, absolutely. Who knows what we're pushing right now? We've been here all night. Yeah. I have no idea what the sun is doing at this point, right? So. I think my flight left like five hours ago. You live here now. Are you guys flying out tonight? No. No. Okay. Good.

2:31:31Early to like 4 a.m. tomorrow. Yeah. Yeah. That's fine. out of here. I'm just going to sleep under your table. Yeah. I mean, we, we optimize for like, like watch. Oh yeah, that's Matt Pat. We can't get him to leave. Hi Ryan. He's been here since the recording. Hey Jimmy. This is my home now, but yeah. Yeah. So I totally agree. But I think that's, I think it's a really good note to say that each video has a different purpose. Yeah. And I think it's okay that not all of them are pegged at the same. For me, I think the, when it comes to average view duration, the thing that I like looking at is the nuance of new viewers versus returning viewers and how the duration is for each of those, right?

2:32:06You would expect returning viewers to be slightly longer and new viewers to be slightly less just because that's how it works. But I like seeing what the delta is between those two because now all of a sudden, hey, if that new viewer was pretty darn close to where that returning viewer is, it means like I've gotten them. And I'm knowing how to speak to these new viewers in a way that's retaining them and likely converting them into someone who's going to follow us moving forward. Those are people who will remember. Bustwood the Boys is here to let you know that every college football Saturday, FanDuel is dropping profit boosts that can turn wins into bigger wins.

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2:33:01Herb My Brand. Right, exactly. That's exactly right. Have you shot the final video? Part of it. Yeah, we actually just came from shooting part of it yesterday. Yeah. Does it involve pyrotechnics? How crazy are we getting here? It's kind of tricky, I think. It's going to be wild. It's going to be kind of a wacky one. I'm really excited about it. I think people who want to have a fun, quirky ending will not be disappointed. Good. You can say as much else as you want to say. No, I think, you know, the emotional sign-off was the goodbye internet video. The fun celebratory sign-off that is a celebration of kind of the last 13 years of me hosting these channels.

2:33:45That is what's coming next. And I think it's going to be unexpected. I think it's going to be fun. I think it's going to be fan-service-y. And I think people who tune in are going to have themselves a good time. I can't wait I can't wait for that yeah I do want to acknowledge that there are comps in traditional media for stuff like this right where it's like whether it's late night hosts right or the way we've likened it is actually the the last season of a quarterback of a football team right so like if we dabble with sports ball yeah sports ball so so you know you get an announcement that like a QB is retiring almost a full season right before they actually retire right and so that last season and that's on purpose right the team wants you to tune in to all of you know every game that that person is in until they retire and so it's we've kind of likened it to that it's like okay we're going to give people like a season's worth of heads up and yeah it's like it's 10 videos or 9 videos because we miscounted on all of the channels we didn't actually miscount that was kind of the joke but yeah sure sure we didn't Jason Jason on our team who is our chief creative officer he's very adamant saying, we did not miscount.

2:34:56I fully anticipated that one to be the first of the theory. Fine. He was like, I can't believe you would say that. I'm like, it's fine, Jason. It's okay. But anyway, yes. So anyway, please continue. So, no, it was like, so it's the last season, 10 episodes on each channel, right? But, you know, it's 40 episodes. So there's a whole season. Yeah, that's a whole season. And you're making it to the Super Bowl. Yeah, exactly. And then we're at the Super Bowl. What were we going to say about late night hosts? Oh, that's all I was saying is that there's comps. I think the sports team is good because the team continues with a new quarterback.

2:35:24Yeah, yeah, exactly. Absolutely. New quarterback, new late night host, new doctor. If you're a Doctor Who fan, a Whovian. Nope. No. Okay, great. Cool. Fine. Quarterbacks then. Yeah. Sports theory. Great. Yeah. Right. Cool. A couple of jocks. Sports theory is going to be a banger with you guys, let me tell you. We could host. We could host. Hey. It could be us. We're in the market for hosts. We're in the channels. Creative director. There you go. Yeah, there it is. I don't know what that does. Damn it. this whole time. I still don't know what that does. God, we have failed so mightily across the board.

2:35:59Well, I'm very excited to see what comes next. Thank you. Again, I think like this is a moment that I think, obviously you saw it across the whole platform where it almost was like everyone wanted to, everyone was ready to share something based on this, right? You gave a lot of people permission to even think in this direction. And I think, you know, we've all in different ways in this era pioneered something new in media. And then specifically on the platform started to, there's a lot of these people who are on the Mount Rushmore who have pioneered things. And I think you've done it in many different ways, but I think this year you did it in a way that gave a lot of people permission to look at themselves and recognize which parts of this job they like, don't like, how they want to continue it.

2:36:47What's even possible? Is it possible to retire? So thank you guys. We'll see. Thank you. here's the thing like is it possible to retire we're gonna we're gonna find out we'll find out i'm really excited i'm just as excited to see as everyone else i mean but i mean it isn't it like you're not gonna find out i mean it is easy you can retire you just stop you stop you're tom brady retired sure and then comes back right but you can always i mean it's up to you though whether you hit that upload button again right and that publish button no but thank you that that means a lot actually that's like when i think about like did we leave our mark and were we a good role model for the future generations of creator like that to me is really important you know it's been important for me to steward our audience through a chunk of their life and teach them something wacky about mario being a sociopath or whatever you know or a little something that got them through like a science test or whatever but at the end of the day too like i look at this industry and how privileged we have both been to be in the early days of it and to help shape it and pioneer it in a lot of different ways.

2:37:49And so to, you know, like our hope is to have left this platform a little bit better as a result. So thank you for saying that. That means a lot. Appreciate it. Yeah. Yeah, thank you guys. Yeah, of course. Cool. Well, where do people follow you personally now? Nowhere. Isn't that weird? That's a wild one. I guess look at their Instagrams. Yeah, absolutely. I'm here. I'll plug Elon here. Follow me at MatPatGT on Twitter. Or on X, I guess, at this end. M-A-T-P-A-T-G-T. It's the same on Instagram and TikTok. Yeah, I'm MatPatGT on all of them. So I probably have to lose the GT at this point. But that's it.

2:38:33MatPat, the end. Cool. Thank you, guys. Thank you, guys. Appreciate the time. Yeah, thanks. Thank you.

2:38:45Thank you.