Mr.Beast, A scalable startup or Youtube Channel?
I don’t know how many founders or executives are aware of Mr. Beast, but he is one of the most valuable content creators in the world and he intends to turn his company into a unicorn already.
Mr. Beast, whose real name is Jimmy Donaldson, is a popular American YouTuber and philanthropist known for his extravagant and elaborate video productions, particularly those involving the giving away or use of large amounts of money for charitable causes.
He first gained popularity on YouTube in the mid-2010s with his stunt and challenge videos, which often involved elaborate setups and the use of large sums of money.
But the story of how he became really viral began when he uploaded a video in which he counted to 100,000. This video became viral very quickly, and one brand decided to purchase ads on Mr. Beast’s channel as a result. According to the agreement, Mr. Beast received $10,000. This was the beginning of his business idea and value proposition.
He thought that if he gave the entire amount of money to a homeless person on the street, people would like it. And he was right! Americans loved it. This video also went viral and was a major milestone in his career and YouTube channel.
When I was a Chobani Fellow, the brand manager and PR director told us a story about how Chobani survived after the moldy yogurt scandal. One day, due to circumstances beyond their control, Chobani yogurt became moldy and 89 customers became sick. After this scandal, Chobani recalled all of their yogurts, and sales dropped significantly. But Chobani’s company culture and brand structure are based on being sincere and open to people, so they acted in a way that was consistent with their values. The founder and CEO of Chobani publicly apologized to all customers and accepted responsibility for the incident. Americans are emotional, just like Mr. Beast’s example showed. After this apology, Chobani’s sales that month was the highest in the company’s history.
Isn’t it amazing? Mr. Beast discovered what sells and what is interesting to Americans while he was just a teenager. He learned this through his giveaway videos, and as a result, his YouTube channel became very popular. He literally gave away millions and millions of dollars to people and his friends in his videos.
But is this profitable? Most of the time, the answer is no, according to his interviews. He knows that the amount of money he gave away is directly proportional to the number of views he received. So, in order to invest back into his business, he did it. He spent more money than he earned. How has he been able to survive without receiving any investments all this time? He knew that he needed to create more income streams outside of his main YouTube channel.
So, he thought, why don’t I create more channels? And he started his side channels: Mr.Beast Gaming, Mr.Beast Reacts, Mr.Beast 2, and Mr.Philanthropy. Especially, the gaming and react channels were very profitable compared to his main channel because they required minimal cost — they just involved sitting in front of a computer. And these sub-channels consistently supported and promoted the main brand. His brilliant mind led him to create an empire on YouTube.
“It might seem hard to imagine how a content creator’s business can be worth that much, but the North Carolina resident has built an impressive empire. With 109 million YouTube subscribers, MrBeast runs the fifth most subscribed channel on the platform, and he’s the top earner among U.S. YouTubers. Across his five other channels, he’s amassed another 82 million subscribers — and that’s not even counting his three Spanish language channels, which have about 33 million subscribers combined.” according to Techcrunch.
According to an Axios report, MrBeast is searching for $150 million in funding, which would help the YouTuber expand his presence in the consumer goods space. With this round of funding, MrBeast has valued his company at $1.5 billion — marking another attempt by the social media star to cement his online domain with a physical (and cash-rich) retail stronghold.
I have seen a lot of startups over the years, and I have been working in a startup environment for at least 7 years. From what I have seen, Mr. Beast knows what to do and how to sell. Unlike most founders, he doesn’t need the money to continue his business. In Silicon Valley, we have seen terrible startups that have raised more money than Mr. Beast. If I were a partner at a VC firm, I would be eager to give him money. We have even seen many “micro-mobility” failures or hype failures like Clubhouse or Vine.
Silicon valley founders know Y Combinator’s motto is “Make Something People Want.” He already found 100 Million people for something he made. It’s time to fund and build :)
