· Influencer marketing in the US is set to top $3 billion this year, according to eMarketer.
· The creator boom has given rise to new specialty companies that offer production, distribution, and talent management.
· They include companies like Made in Network and Jellysmack, which help many top YouTubers.
And while many influencers want to maintain full control over their brands, at some point, top creators will come to rely on help from a growing number of companies that provide services like talent management, distribution, and monetization — and, to varying degrees, content creation.
They include Nashville’s Made in Network, which helps video stars like Andrew Rea of “Binging with Babish”, who has more than 9 million YouTube followers, on work like developing video concepts and co-writing scripts; the company also worked with a licensing firm to launch Babish’s cookware line on Amazon last year.
TikToker Nick Cho, who goes by “Your Korean Dad,” said Made in Network helped him launch a YouTube channel this summer.
Studio71 is primarily a talent-management agency representing more than 1,000 YouTubers including comedian Lily Singh and gamer Jacksepticeye.
But Studio71 also films and distributes content for creators and helps them monetize through advertising. It helps YouTubers of color launch audio and video podcasts; one such client is gadget reviewer Marques Brownlee, host of “Waveform: The MKBHD Podcast.” Studio71 VP of podcasts Stephen Perlstein said Studio71 podcast revenues have grown 17% month-over-month since its 2018 launch.
“Our goal is to be a multi-platform publisher that supports creators in every aspect of their business,” co-CEO Adam Boorstin said.
Startup Wheelhouse Group is a production house launched by the co-creators of reality TV hits like “Queer Eye” and “Real Housewives.” Working with creators on everything from YouTube and TikTok videos to commercial-free streaming series and full-length films, it wants to build the next reality TV franchises around creators. Wheelhouse chief strategy officer Ed Simpson said the firm helped Thomas Petrou of creator group Hype House develop the concept and write scripts for a series they sold to Netflix in April.
“The creator spends nothing, and the minute we get monetization it’s shared. We take all the risk, which is why creators like it,” said Jellysmack president Sean Atkins, a vet of MTV, HBO, and Discovery.
Some creators also look to these companies for informal career help. Marty Schwartz, a guitar teacher with nearly three million YouTube followers who goes by “Marty Music,” said Made in Network comes up with ideas for his videos, handles all editing work, and has set up deals with brands like Gibson Guitars and Rocket Mortgage.
“Lots of creators don’t want to let go of control, but I welcomed the help,” said Schwartz.
Advertising sales for these companies has increased significantly in recent years, and investors are paying close attention. A frequently cited study estimates VC firms have poured around $1 billion into creator-centric businesses so far this year.
Jellysmack received a May Series C round led by SoftBank’s Vision Fund 2 that president Sean Atkins described as a “nine-figure raise.” Jellysmack said it plans to use its new funding to acquire other businesses. Various outlets reported the platform had achieved a $1 billion-plus “unicorn” valuation, and Atkins said the company has more than doubled its headcount to 900 in 2021.
Jimmy Kimmel’s production company invested in Wheelhouse when it launched, and German broadcaster ProSiebenStat.1 bought a controlling interest in Studio71 in 2015. Wheelhouse’s investment division in turn bought stakes in production company Campfire and content agency Portal A.
Parade’s publisher, AMG/Parade, acquired a minority stake in Made in Network in 2018; insiders also named the firm as an M&A target for media companies and ad agencies.
Traditional advertising companies want in on the creator marketing boom. In the past year, WPP signed a deal with TikTok to give clients more access to the app; Mark Penn’s Stagwell launched a tech platform to connect creators with brands; and Tool of North America started helping stars like TikToker Grace Wells get work directing ad campaigns.
Specialty agencies believe the field is still open for them, though. Made in Network CEO Kevin Grosch said marketers started paying more attention to the creator economy as YouTube viewership soared in 2020; he predicted influencer marketing would soon become its own category in big brands’ budgets. Sean Atkins of Jellysmack predicted the growing creator economy would create more room for companies like his.
“Creators beget traffic, which begets monetization; it’s the virtuous circle,” Atkins said. “That genie’s not going back in the bottle.”