On-line creators and their enterprise fashions have been on our thoughts this week after mega-popular YouTuber MrBeast introduced that his firm is shopping for fintech startup Step, adopted by Hollywood studios sending a flurry of cease-and-desist letters to ByteDance over the launch of its new video era mannequin Seedance 2.0.
These seemingly unconnected headlines counsel a media panorama within the midst of transformative change, as common YouTubers look to diversify their enterprise fashions, with the menace and promise of more and more highly effective generative AI instruments on the horizon.
On the most recent episode of TechCrunch’s Fairness podcast, Kirsten Korosec, Rebecca Bellan, and I debated what’s subsequent for the creator economic system, and whether or not there might be any room for the following era of creators to face out.
“What’s the following saturation level?” Kirsten questioned. “Not all of those of us can exit and spin off merchandise. So then does the pool of profitable creators simply merely get smaller? Or will one thing else occur, technologically talking, or a unique medium that can enable them to seek out an viewers to become profitable off of?”
You’ll be able to learn a preview of our dialog, edited for size and readability, beneath.
Anthony: [The news] led our colleague Lauren to do that nice piece speaking concerning the creator enterprise mannequin typically, and this sense that they aren’t simply counting on advert income anymore. I feel it’s nonetheless a fairly large a part of their enterprise, however she broke down plenty of the preferred YouTubers and famous that every of them is increasing — often into e-commerce, but in addition into different income streams.
Mr. Beast, for instance, really has this line of meals merchandise, together with chocolate, that’s making lots of of hundreds of thousands of {dollars} and it was really worthwhile for him in 2024, whereas his media enterprise was shedding cash. All that was fairly wild to me.
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Kirsten: If Mr. Beast can’t be worthwhile along with his media firm, who can? To me, that was a shocking stat.
I’m not stunned that the entire advert income biz sport will not be figuring out essentially for creators and influencers as a result of it’s simply reached a saturation level. I suppose my massive query is, what’s the following saturation level? Not all of those of us can exit and spin off merchandise. So then does the pool of profitable creators simply merely get smaller? Or will one thing else occur, technologically talking, or a unique medium that can enable them to seek out an viewers to become profitable off of?
Rebecca: It’s fascinating, there’s a whole lot of methods you’ll be able to take into consideration what else may occur, proper? Perhaps they’ll create digital twins of themselves and put their digital twins right into a bunch of various conditions that may make them [other kinds of] cash.
However once more, going again to this not being stunning, these folks at the moment are celebrities, proper? Somebody instructed me on the cellphone not too long ago that a whole lot of [the] youthful era, they don’t know our celebrities, they know TikTok celebrities. And we’ve seen celebrities for years move off merchandise and become profitable off of them, proper? I used to observe Rachel [Ray], she was a star chef and he or she offered her EVOO or her olive oil.
We Sluggish Ventures on [Equity] someday final yr. They’ve a creator fund and mainly what they’re doing is that they’ve raised a VC fund to basically again creators with their companies, if they’ve perhaps a distinct segment following, perhaps they’re actually into woodworking and right here’s their assortment of chisels, I don’t know.
I feel it’s an fascinating path ahead and it’s one thing that we see as journalists: How can we additionally attempt to be creators and make a model of ourselves that we may diversify our income. It sounds horrible to say it out loud like that.
Anthony: I’m smiling, but it surely’s the smile of any person whose soul is slowly turning into ash inside.
So we took a break from speaking about AI, however I’ll obligatorily carry AI again into the dialog. Clearly one of many different associated developments over the previous week or so is that ByteDance, which is the Chinese language firm that launched TikTok and continues to be an investor — we gained’t get into all of that — they launched a brand new model of their mannequin, Seedance 2.0, which a minimum of initially was primarily solely out there to Chinese language customers.
However you began to see folks posting movies generated by Seedance, together with this viral video of Brad Pitt preventing Tom Cruise. That prompted each this normal dialog of: Is Hollywood doomed? After which extra concretely, a bunch of Hollywood studios, together with Netflix, sending ByteDance letters being like, “You can not do that, you’re mainly permitting all of your customers to generate movies utilizing all of our IP, all of our film stars.” And for a few days, there was no response in any respect from ByteDance, however then they did say, “Sorry, sorry, sorry, for some purpose we launched this with none actual guardrails, however we’re gonna do higher sooner or later.”
Kirsten: So the timing of that is simply excellent as a result of I occur to be enhancing a narrative proper now that Rebecca wrote. It has nothing to do with Seedance, but it surely does should do with AI and filmmaking. So I’m going to present a future ]rops to Rebecca for being well timed about that. Rebecca, I do know you’ve got rather a lot to say on that, moreover that Hollywood is upset. Is it extra sophisticated than that?
Rebecca: Yeah, positively. I imply, tying this again to the creators factor, I feel that lots of people are going to be utilizing these instruments to supply every kind of content material and we’re simply going to be completely flooded. And that’s going to be intense.
However after we speak about, whether or not it’s creating movies or advertisements or simply content material typically utilizing AI video instruments, I feel there’s this stress between one, that is going to supply a complete lot of low effort slop versus two, it may additionally democratize entry for lots of people who don’t have funds or budgets or groups to share a whole lot of the tales that they need to inform.
And in addition, for those who’re a small enterprise and also you need to create a little bit shampoo advert — to be on the nostril about it, as a result of there’s a shampoo advert that’s going viral — otherwise you promote espresso and also you need to make a little bit advert for it, [this] may provide the instruments to do this. Is {that a} dangerous factor? Is it not a nasty factor? Do we’d like extra content material on this planet? There’s a couple of avenues to stroll down.
Kirsten: Is it a nasty factor, Anthony?
Anthony: When it comes to the creator aspect of it, my normal feeling is [that] the response to a whole lot of this type of slop — frankly, a whole lot of it is slop, and I feel that’s going to proceed to be the case — goes to be this valuing of authenticity. And so there may be the chance for these massive creators is be much less concerning the concept of like, “I’ve digital twins of myself,” however [instead,] “No, I’m the true Mr. Beast, not the digital simulacra wandering round.”
And I feel it’s additionally telling that – after all, each social community has ups and downs, however that OpenAI’s Sora, from what I perceive, had skyrocketed at the start after which has been struggling to carry on to customers extra not too long ago, as a result of there’s a sure vacancy to the expertise while you simply really feel like there’s not an genuine human being on the opposite aspect.
However I feel it’s additionally going to make the panorama rather more difficult, each for the established creators to monetize […] after which I feel it’s going to be particularly laborious for brand new creators as a result of there’s simply going to be a lot extra stuff. Attempting to really escape goes to turn out to be tremendous tough.
