71 - Marc Hustvedt, MrBeast

Conor Begley: Today was a big day. It doesn't get any more noteworthy than MrBeast, at least when it comes to creators. And Marc himself and his background is unbelievably impressive as well. I think you're going to enjoy it. Remember, if you do, be a friend, tell a friend. That's the best way you can know. Thanks, guys.

Speaker 2: Explore the minds and marketing strategies behind today's winning brands and businesses. Tap into the power of the creator economy with Earned by CreatorIQ. Here's Conor Begley.

Conor Begley: Hi, everyone. Welcome to Earned. Today, I've got Marc Hustvedt on the show today. Welcome to the show, Marc.

Marc Hustvedt: Hi, great to be here. Thanks, Conor.

Conor Begley: I was just telling Marc that I was with his good friend Tim, who you guys might have heard of on the podcast before, that referred us in, and they're good friends. So I'm appreciative for Tim for connecting us.

Marc Hustvedt: We spent a good part of the pandemic winter holed up in a ski house together, which is absolutely crazy when you both have small children to be cohabitating together, but it was honestly one of the coolest experiences.

Conor Begley: We did the same thing with family, though. We all journeyed to Tahoe, and my wife's family has a big house up there and it was like nine adults, two babies, and three dogs in a house for three months, and it was pretty awesome. Well, I want to brag about you for a second, Marc. So Marc is a serial entrepreneur and executive across all these leading- edge technology, entertainment companies, including cofounding Tubefilter a long time ago, SUPERGRAVITY Pictures, Streamy Awards, React Media. And then most recently, you joined as the president, I think about 18 months ago, at MrBeast, right?

Marc Hustvedt: That's right. You can learn new things every day. I mean, I work for a 24- year- old now, and he teaches me so many things. So it's one of the coolest jobs I've ever had, and the wildest, and we'll get into it, but it's as crazy as you think it'd be.

Conor Begley: I can literally only imagine. And again, I don't think there's many people that live under rocks and don't know who MrBeast is, but just quickly, he is the largest individual YouTuber by subscriber base, 134 million on his main channel. Got a bunch of other channels too. I think what's particularly interesting is, if you look just at the last four months, four and a half or 4. 6 billion views on that channel, which is over 142% year- over- year growth, recently I think valued around$1.5 billion. He's a big deal, to say the least.

Marc Hustvedt: And getting bigger. We're seeing how big this can really get. I've never seen a creator like him. We talk a lot about the five- tool athletes sometimes in sports. And to make a sports analogy, I wrote it down once, Jimmy is like a 12- tool athlete in terms of why he's such a good creator, and it's of course understanding virality, acquisition, retention, able to edit, great on- camera personality, good heart, but also a risk- taker as an entrepreneur. I mean, there's about 12 different things, and you rarely get that full package in a creator. When you do, you get something like Jimmy.

Conor Begley: Yeah. I think rare is a key word there, right? There literally isn't anyone else that is this big at this point. So you'll see people that are athletes or musicians, et cetera, but to be a 24- year- old kid that grew up in North Carolina that's now the most prominent video creator in the world, you got to be doing something special to get there. We're going to have a lot of time to talk about MrBeast and we'll get into that.

Marc Hustvedt: Cool.

Conor Begley: But I do want to talk about you, because I think that you... Obviously, there's a reason that you got hired to be the president, and I think that your experience is really relevant to the discussions. I think, I was really excited for this interview and I knew we'd get along, because you are constantly starting new things that have gone on to do really well. I mentioned earlier about Tubefilter, Streamy Awards, all these kinds of things. The phrase that really sticks with me is, " Your whole world changes when you realize everything around you was built by people no smarter than yourself," and I think it's a Steve Jobs quote. Not saying that you're no smarter than me, but I think that once you realize like, " Oh, I could do that. I could build that thing. There's nothing that stops me from doing that," it's like, worldview done, changed. So talk to me about that. Why are you so attracted to getting things off the ground? What is it about that that speaks to you?

Marc Hustvedt: It's a little bit of just, goes back to childhood, and I grew up in this family of computer scientists, and my brother was at Google. He's a software engineer. And we all just were obsessed over computers as a family, and I think, early on, was able to see what kind of leverage computing power could really give. So I think a big part of starting businesses for me has always been connecting with the world. And early on, I think, God, I was in college, banner ads were everywhere and we figured out you could buy frequent flyer miles. So we started this business called airClick, and we would incent people to click on the banner ads and you get five Delta miles for it. And of course, a lot of people would click on this because people were hyped about miles. I think they were worth a little more back then. And the great moment of success, I mean, it was sort of just as we were proof- of- concepting it, and eventually we get cease and desist letters from all the major airlines. I still have them framed somewhere in the attic or something, and I was like, " Okay. Now we've made attention because we've made it onto all the frequent flyer sites of how to optimize for miles." And we got a few advertisers signed up, and I remember Dell Computer to do a trial or something. And it was a lot of fun, but also, we had that moment in college where you kind of realized like, " Do I leave for this or not?" And I think it was like 1998 at that time. There were some cracks in the early internet bubble, and I'm really glad I was at Michigan and stuck it out and finished there, but I think that got the bug for me. There was some other random childhood businesses, but needless to say, I've always sort of been fascinated by the edge and where things are heading. If I'm ever entering into a traditional business where there's a very defined cadence of, " Here, you do two years at this level and two years at this level," then I don't want to be there. That's not the business for me. So that's what really kicks off my journey. And then honestly, Tubefilter was just... We were hanging out with a lot of early online video creators, and I was inspired by Mike Arrington. He was basically documenting, I think as he was a recovering lawyer, and he was sleeping on the couch of all these founders who sort of was profiling startups in that early 2000s. And so, I was inspired by that and said, " Something similar is going on in Hollywood." I had moved to Los Angeles around 2005. And anyway, I just found it fascinating to write about them and I tried to just write every day. I was not a journalist. I did not know what I was doing, but I became this incredible hack. You could meet anyone. I literally could reach out. Eventually, they started reaching out to me, but for a while, it was like, " Hey, can I interview you for Tubefilter? I want to talk about your$2, 000 deal that you got on this brand or your 20, 000 you got from MySpace." It was the early days, but anybody who had online video, who was doing anything on the internet, I basically was just so curious and fascinated by. And then we started doing events and built a community. We call them the Web Meetups or Tubefilter Meetups, and I remember we'd get them up to sometimes 600, 800 people. We'd get some sponsors, usually B2B vendors in the space, to cover the bar tab and maybe a few extra bucks to keep our site alive. But those early days, it certainly was not about making a lot of money. It was really about building the community, and then we said, " Let's do an award show," because this space needs an award show, and that became the Streamys. That was an act of love and pain. We put it on our credit cards, definitely the first year. We independently produced it for two years. Second year, if anyone remembers, the second year of the Streamys was a disaster. The first year was great. So writers' strike of 2007. And so, right after that, all this content was made, because all these writers and actors couldn't actually go on to television during that time. So there was a loophole where they could make content for the web. And so, that had Lisa Kudrow's Web Therapy. You had Dr. Horrible's Sing- Along Blog for Joss Whedon and Neil Patrick Harris, Felicia Day, and of course, Felicia Day's The Guild. She was the darling. I mean, she was the superstar of that era with web content. It was a lot of fun. We said, " Let's do an award show." And somehow, these celebrities showed up, and we didn't know how to run a red carpet. I remember Lisa Kudrow shows up and the red carpet is just bogged with all of these random web video people and she's kind of looking at us like, " What is going on?" All these real Hollywood publicists were like, " You guys don't know what you're doing." But the show worked. We live- streamed it, which was very difficult to do back then. It was very expensive. And then the second show a year later, it was a little tricky. We had naked streakers on stage during the live stream. That was a rough point. But otherwise, I remember some Hollywood people said, " You know what? It doesn't matter. People are talking about it. It's going to be fine." But we were devastated. That was a low point for me. And at that point, we actually did a deal with Dick Clark Productions, and they said, " All right. We can help you here."

Marc Hustvedt: And

Marc Hustvedt: they did the American Music Awards and all that, and they did the Golden Globes, and they're like, " Don't worry. We've been here before." So they've been a great partner over the years. And after that, I got sort of the itch. I mean, I guess the question in all of that was like, " Why do I do it?" I don't really know. I guess I have the itch. Plus, I was sort of making a job for myself in a way that I wanted to do. I was very fortunate to be able to do that. We still had to hustle and convince anyone to give us a sponsorship. It was a grind, but it was like a grind when you knew something special was happening. Online video was going to explode. YouTube had just launched, but it hadn't become the winner yet. It did become clear about two or three years in that there was something different about YouTubers. I mean, talk about that later, but it was a lot of fun. Those were really, really good years and we had some great cofounders in Drew Baldwin and Josh Cohen. We actually merged with a blog on the East Coast. We had this East Coast- West Coast rivalry. Josh and Jamison had this thing called Tilzy.TV and they were doing basically the same thing as Tubefilter, and we were just like, " Let's just make one site. We're just competing with each other. This is silly." And we were partners on the award show.

Conor Begley: Oh, that's cool.

Marc Hustvedt: Yeah, it was a lot fun.

Conor Begley: Well, you said YouTubers are different. What do you mean by that?

Marc Hustvedt: Well, there were a lot of sort of tribes that I felt like we were tapping into then. There was the video podcasters, the Tiki Bar TV people came to mind. There was the... some people call the web television or web series at that point. There was independent TV going on, and that was particularly because we were in L. A. You had a lot of people that were basically trying to be in Hollywood in one way or another, and it became sort of like making a short film, " I'm going to do a web series." It was a way to showcase their work, but ultimately a stepping stone. They weren't really obsessed with algorithmic discovery or optimizing for acquisition or retention. They were really just trying to make dollars, and I think there was something different. And obviously, Benny and Rafi Fine stood out to me. I would later end up working with them closely, obviously, but they work harder. They obsess. There was these patterns emerging with the top YouTubers, Phil DeFranco, iJustine. Just an obsession with figuring out YouTube, because I think they saw the value in how big YouTube would get. A lot of them, you ask them and they'll say, " Look, I only went there because it was free hosting." And I was paying... The Fine brothers, famously, they would have this website and they'd make viral videos, and every time they had a viral video, it would crash their website, or they have bandwidth fees to pay. And so, there was actually a need for a free hosting site.

Conor Begley: Yeah. And save money, and stayed up.

Marc Hustvedt: Exactly. And then subscribers became a thing. And of course, once the YouTube Partner Program really got going, I think that really changed the game.

Conor Begley: Yeah, rev share. Yeah. I mean, there was a quote from MrBeast where he said... I think he dropped out of college and he's like, " I'd rather be poor and only work on YouTube than going to school." And she was like, " Okay. That's what you got to do." Right? And he was just obsessed. And I think there's a timeline on it where it was like, first, whatever, 10 years it took to get to one million subscribers and it was like four years to get to 100 million subscribers, and it takes a long time to get good at. Right?

Marc Hustvedt: Yeah.

Conor Begley: But in some ways, I think the most fascinating part is, it actually provides a very immediate feedback loop for whether or not your content is good. If you put it out there and it gets reception and it goes viral, you go, " Oh, that was interesting. What was it about that that made it go viral or that people really liked?" And you can train yourself very, very quickly in a way that would be very difficult in traditional film mediums, where you work on a project with all this effort into it, you release it, and then that's only one feedback point. Right?

Marc Hustvedt: Totally.

Conor Begley: I don't know. It's fascinating.

Marc Hustvedt: You're absolutely right. That iterative improvement cycle is almost a sort of software mindset as opposed to the artist mindset of, " This is my art. Take it or leave it. This is what it is." This sort of auteur filmmaker who really, to some degree, is sort of, they listen to audience, but ultimately do the art that they need to make. And I think there's absolutely something different about YouTubers.

Conor Begley: Yeah. So you've done a lot of projects in the digital entertainment landscape, whether it's social video to more traditional productions. For you, what are the elements that you've seen or that you've noticed about the matrix that stand out as like, " These are the core elements that make a successful piece of content"? What do you notice about that?

Marc Hustvedt: Oh, wow. I guess it kind of depends on where that content is intended to be screened and what its purpose is. I've dabbled in movies, but I cannot say I know how to make a movie of high degree. What I think I have learned, and I see this certainly as pattern, is you absolutely need to take a creative- first approach. You cannot let the business drive your decision- making along that way. Usually, I'm biased towards a creator- centric model. That's why I tend to gravitate towards creators, is, you really do aggregate a lot of the decision- making, even the business decision- making, to the creator, and you support that creator, versus sort of, I think, a traditional media mindset is, it's driven by a C- suite that's largely not creative and is ultimately looking at, " How much are we making this for?" They're looking at efficiencies. They're looking at lots of things. I think one example of this is when I was making comedy specials. It was a Kleiner- backed startup called Chill. com, and it was the first non- engineer hire. I had to run a little entertainment side of it. And part of what we did, the product had evolved to be a paid VOD service, where it's similar to Vimeo's On Demand product, but it was the era of Louis C. K.'s$ 5 comedy special, where he put up a comedy special and sold it for five bucks, and he was shocked at how many millions of dollars it made. And so, we were exploring that pattern of like, " Okay. Can we work directly with comedians and make something special that hasn't gone through the machine of corporate comedy and put it out on the internet, and especially allow the artist to own it too?" That was a big thing. So I kind of went out and tested this and met some comedians and stumbled into Maria Bamford, who I admired a whole lot, and she had this quirky idea that she was going to do a comedy special. She was a big touring comedian at the time. She was making a good living touring, but she had a nontraditional special she wanted to do just in her living room in front of her parents. I guess she had pitched this to Comedy Central and they'd be like, " No, this is not what we want to do." And Comedy Central, at that time, was the leader in comedy specials. And they basically had a formula where they would shoot in New Orleans and have an audience, paid audience in and they would do a special and then shuffle them out and do another special and there was this sort of efficiency model to it, and it sort of took some of the creativity out of these specials. And Maria had this great idea. And of course, coming from an online video point of view, I'm like, " Living room is perfect. It'll actually cost less and it's more intimate." Anyway, so it was actually written up as this revolutionary thing. I wish I saw that at the time. Ultimately, I was just glad she said yes. So we did this special, and I honestly think it was in the low tens of thousands of dollars to do it, and it would make 10x return the second we uploaded it. And then ultimately, it would go to Netflix in second window, but she owns it. And Chill is a platform that ended up selling to Tinder and it's gone, and for what it is, but the artist owns that. That was a really critical insight. So all of the deals we did were always way more favorable to the artist or creator. And so, we did Ari Shaffir's first hour. That was really cool. He just happened to live down the street from our office and took the meeting, and we said, " Look, we'll fund your hour. You can do whatever you want, man." And I didn't realize how giving a comedian that kind of authority... I was so used to it from the YouTubers having full control. I just didn't realize that it was new to the comedy space. So it was a lot of fun, then Netflix, years later, would come in with these just amazingly killer deals. So the opportunity-

Conor Begley: Yeah. Just the way it was put out. Yeah.

Marc Hustvedt: ... to dothat as a startup was gone. You needed a lot of money for the comedians.

Conor Begley: It's hard to resist that desire to push the commercial aspects of things.

Marc Hustvedt: Yeah.

Conor Begley: And again, in a lot of ways, that's a big part of this creator movement, is you remove that entire middle layer and allow people to just go direct, and the cream rises to the top. It's just such a special space to be in the middle of.

Marc Hustvedt: It really is. And I think that it's fun to be scaling a creator business but always reminding ourselves that we are a creator business. We're not a media company. We're really trying to break a lot of the habits and norms that large- scale... Even digital media companies went there, where you just say yes to all these deals because you're so revenue- obsessed and you're keeping investors happy versus really thinking about the brand and the core content, what is your core content business. And so, here, it's wild how many deals we will say no to that even on paper from a financial point of view, you'd be like, "This is a no- brainer. Why are we not doing this deal?" But that's also some of the ways you learn from somebody like Jimmy. It's like fresh eyes looking at things and saying, " Why do we need to do that?" We don't need to do that. It's refreshing. Seriously. That's where being sometimes, you learn all these habits and then you have to sort of unlearn them.

Conor Begley: Yeah. Let's switch topics to him or to MrBeast, the broader organization. And it's funny. You talked about how these comedy specials, you put it on for 10 grand or not very much money. I actually think one of the innovative things that Jimmy did was went big production, spent a lot of money on YouTube. These videos, compared to most other YouTube videos, have budgets 10, 20, 100 times the size.

Marc Hustvedt: Yeah.

Conor Begley: Let's talk about just the last four or five months. Right? So you went from averaging, call it, three, four, 100 million views on the main channel to averaging over a billion views over the last four months. What are you attributing that explosion to? What's the cultural zeitgeist going on with him right now?

Marc Hustvedt: There's a compounding effect of a lot of things happening at once, I think, and I don't want to necessarily over- attribute one thing to another. I think it's pretty well- known that we dub into 12 different languages, and with more to come. There are fully voice studios that fire up as soon as we picture lock that have voice actors just reading and everything is being translated, and it's a fully localized version both in on- screen graphics and in the audio tracks. So we were launching a number of these side channels, the localized channels, MrBeast en Español and Portuguese, and you're sort of like sharding audience into all of these side channels. And what we played around with a bit, which is saying, " No. You know what? We'll just add those tracks into main and you can watch it on main." That's been a lot of fun to see, " Okay, let's bring the world into this one unified channel." And I think there's probably different schools of thought there, but if you go to MrBeast en Español right now, you can go and see the latest videos, like basically just telling that audience to move over. So I think some of it you're seeing is global audience coming over. But honestly, a lot of other things, I think, were probably also in play there, and you have Jimmy as a celebrity as the world finds out about him too, and frankly also keeping the content. This latest video with doing vision surgery and helping people see again was, you're breaking into a whole new audience and you could see that have more of a conversation in the traditional media and people our age that are really starting to wake up to who Jimmy is and what we're up to.

Conor Begley: Well, I think the centralization makes a lot of sense too because, again, you get the halo effect of like, " Oh, we're the largest individual YouTube channel." Right? That creates that conversation, that centralization versus a variety of smaller channels. I'm curious how much TikTok has played a role, mostly because, again, you're always influenced by your personal experiences, but I was sitting in bed with my wife. We're both watching TikTok, and she holds up her phone and shows it. She's like, "Oh my God, you got to watch this video." It's of MrBeast, and she didn't really know who he was and never really watched him, doesn't go on YouTube to watch stuff on YouTube, and now she sees his videos all the time. Has that played much of a role or is that still a growing channel for you guys?

Marc Hustvedt: Absolutely. I don't know about you. I'm a big fan of Clayton Christensen's whole Innovator's Dilemma, which really just looks at incumbent businesses and that there's these tectonic shifts in almost every industry, and usually the incumbents are slow to catch up and the upstarts, therefore, have a real opportunity to step in. And if you look at, we were all seeing it, YouTube, of course, was seeing it, the incredible growth of sub- one- minute vertical content on TikTok and elsewhere, and you look at it on one level, it's like an existential threat to our long- form YouTube business. If our long- term YouTube business has a couple of ad breaks, a couple- million- dollar ad integration in the middle of it, each video is a multimillion- dollar piece of business, but it's on a 12- to, whatever, 18- minute video, and here comes the consumption of this ultra- short form. I think, on one level, you can ignore it or you can really lean into it, and I think Jimmy was really savvy in this way. It really is a Clayton Christensen type way where you set up the competitor of yourself to compete against yourself, and I think that's literally what we did with this guy named Rohan, who is just a genius, and he leads our vertical content team and he built a team and it's literally in our old studio. So we're in this nice, new, big studio and he's in the old studio, and it's kind of crappy, but a lot of history there, but runs that team out of there. And they really leaned in and said, " We're not going to repurpose main. We're not going to look at it as like a syndication thing. It's really go native in the platform and have these people only focus on it." And TikTok was primarily focused... Now, of course, it's got Shorts as well, but the most followers of any channel in the world added last year was MrBeast.

Conor Begley: Most net followers added. Yeah.

Marc Hustvedt: Yeah. It was something like 35. 7 million added on. The next was Bad Bunny at 30 million. Khaby added 28. 9, Neymar, 28, and so on. The Rock, I think, added 20 million, but it was about-

Conor Begley: I love that you know those stats so well.

Marc Hustvedt: We obsess over data. We track everything.

Conor Begley: Yeah. Totally. I think the way that he talks about content, and it's obvious when you think about it, but how much time they spend on thumbnails has become a bit of lore, which is like, " Okay, my goal is to create a headline that is essentially clickbait that you're like, 'There's no way this actually happened,'" whatever it is. So it has to be a headline that's going to attract enough attention, and then there's the conversion funnel, how many people see the headline and click. If you can get it from 20% to 30% to 40%, you'd now quadrupled the number of people that click through, and then you have to deliver. You have to deliver on that headline because the experience that they had with that video determines their likelihood to click on the next video, and just the mathematical approach to it was fascinating. Like you said, it's like an algorithmic approach to creating content that seems so obvious, but nobody does. People are starting to do it now, but didn't do it for a long time before that. It's just fascinating.

Marc Hustvedt: It really is. Now, there's this professionalization of certain parts of the craft of YouTube. There's thumbnail theorists and designers that are like... I mean, I got a whole list. If you follow my Twitter, I created a list of a lot of these guys, Jay Alto, Webb, and all these people, and I think we have some of the best in the game, but there's other ones out there. And every time we drop a new thumbnail, these people just break them down, and it's funny to watch. One designer was like, " Oh, he was trying to do this with this set of Monday- morning quarterback, the thumbnail of how it got here." I mean, ultimately, it's always Jimmy's call. At the end of the day, there's definitely tons of work and iteration. To be honest, this is a fun process to watch as it comes together, but it ultimately is so critical, and I think a lot of media companies, brands still don't understand acquisition. I mean, it really comes down to acquisition and retention, and acquisition is great packaging of the title and the thumbnail. That sets that intrigue and curiosity, and then you set sometimes high expectations and then you fulfill those expectations with the click and, of course, whatever the content is behind that. And they're obviously simple in theory. They're hard to do, but I often see a huge opportunity just going to brands and fixing their thumbnails on YouTube. You go to their pages and they still are uploading their 30s and their 60s, and they'll do... You know those brands that just sort of dump? They're like, " This is our entire campaign that's in TV right now. We're just going to dump it all on YouTube." And there's definitely a way to repackage and test that, but I feel like the agencies are not scoped on that or no one's got that capability yet. So there's still an opportunity there.

Conor Begley: Well, you guys are clearly on the leading edge. Right? I've never even heard the word of YouTube thumbnail theorists, but that is-

Marc Hustvedt: Oh, I'm going to send you a list after this.

Conor Begley: I didn't even know that exists.

Marc Hustvedt: You'll see what I'm talking... You go down the rabbit hole of this, and then you get into the retention experts, and there's definitely experts at all levels, and, of course, the analytics folks. It's fun to watch these consultants, and a lot of them will just post on Twitter. Twitter is one of the best places to learn almost anything these days, and they'll post it like, " Here's where..." They'll show stats in the dashboard. " Here's where we started implementing this theory. Here's the impact of it. We're one week later," and you can real- time follow their learnings. I find it cool.

Conor Begley: Yeah. It's fascinating, man. And I think another one that I've heard, gets a lot of attention obviously, is what happens in the first 30 seconds, or whatever that exact cutoff is, and how much time is spent on that first hook, like, " Okay. Yeah. This is something I want to watch." And you can see the drop- off rates with YouTube videos after, whatever, X period of time. It's pretty quick. For you guys then, what are the key things that they are optimizing from a content perspective? There's thumbnail, title, first minute. What else is there? Are those the most important?

Marc Hustvedt: I mean, honestly, there's a lot to it in terms of our theories, and it's constantly evolving. If you asked us three months ago, we hadn't discovered something we just discovered two weeks ago with regard to structure and storytelling. But you are trying to continually optimize to keep the audience stimulated and excited. I mean, particularly with our product, you don't put in a lot of what people from traditional entertainment think are valuable. The little simplest thing, you'll rarely see an establishing shot from us if we're going into a Walmart or something. You don't need to show the outside of a Walmart and then get into it, but television was trained in that way. It's like that little pan outside the house and then you're into the soundstage for the sitcom just to say, "Oh, yeah, they're really in a house." The viewer knows that they're in a Walmart. There's enough visual cues that they're there. One of the most fun things to see is when we've got people who came from television and film or whatever. They're intelligent. They have the skill sets to really do something special with entertainment, but they still need to be retrained, and it's fun to watch them reprogram their own assumptions about it. But value, I mean, obviously, you got to deliver on the promise of what the viewer expected, and that often means early in the video, of course, is really critical. We sort of train internally to think about, " Where in the video is that going to go?" You have to really frame it. And let's say there's this giant spectacle with an airplane shooting off fireworks or something random, and it's going to cost a lot of money. It really actually matters where that is in the video, because if it's something that's in the last 30 seconds of a video, if we're looking at where we need to spend, we're typically going to bias towards the front side of the video. So there's little things about-

Conor Begley: Interesting.

Marc Hustvedt: ... literaltime of video, and progression of a video is super important to think about, but yeah.

Conor Begley: Continuous engagement. Again, the beauty of YouTube is, you get so much data on like, " Oh, shit. In minute 26, we saw a big drop in viewership." What happened in that minute? You can do that kind of analysis on the fly at scale, which is so powerful if you actually use it.

Marc Hustvedt: Within a video, we'll do a brand read, and that may be a 30- to 45- second talking about Shopify and the benefits of you can launch your own store. And Shopify, a terrific partner of ours. We planted a flag on a mountain, I think, that nobody had climbed in Antarctica. It was really fun. They've been a really great partner, but a lot of people would do reads that feel like ad breaks. The viewer is conditioned. There's a lot of cues. And literally, podcasts even change... Even when the host is reading on a podcast, you can tell it's a pre- record because there's a slightly different audio pitch or something, and you just know to hit the skip button. It's literally built into every interface of skip. And so, knowing that, it's like, " How do we make it so that these are not skippable?" because you're so invested in the story that's going on that you just need to see what's going on in the background. So in Squid Game, that was an elimination event using the dodgy game and they were throwing them, and you were literally watching people fall out who are now invested in the number of people that were left in Squid Game. But still, Jimmy's talking about Brawl Stars, this mobile game, and people are saying, " Thank you, Brawl Stars." And it was funny, I have kids and they still, to this day, they'll throw dice or something and then they'll say, " Thank you, Brawl Stars," right before they throw it just kind of as a joke but for good luck. That was what we worked in the story.

Conor Begley: Yeah. Yeah. Yeah.

Marc Hustvedt: So anyway, I think high- retention ads, it's something we really do specialize on so that it is not an interruptive ad. It's so weaved into the story.

Conor Begley: Let's talk about the monetization side of things. So I think, just to throw some stats out there, right? So on the main channel, there's been 766 videos, 21. 7 billion views. It's about 30 million views per video on average. Number one television program in the US is the NFL. They average about 15 million per- game viewers. So it means you double the number one television show in the country. Obviously, slightly different metrics, et cetera, but it doesn't really matter. Additionally, Super Bowl will generate half a billion dollars in ad revenue. It's like 580 million. It has 100 million viewers. Squid Game's got 380 million views. And so, what I think will happen over time is, dollars follow eyeballs. So if, right now, I think that as a channel, it is significantly under- monetized for both creators and publishers on YouTube and the other social channels. So how do you think that evens out over time? What are the opportunities or pathways for those numbers to even out towards where, I think, they should be over time?

Marc Hustvedt: I think you're right. It is incredibly under- monetized from a media scale point of view. There's a lot of ways of slicing this. On some level, you need to pick it up elsewhere and you need to do smarter monetization that works for your niche, and each niche obviously has its own strategies, and sometimes that's build a small, loyal community and add in a subscription model and so forth, and I think those have been well- discussed. We don't have a paid paywall community. The core part of the monetization of the media business is, add revenue on YouTube, so pre- roll and mid- roll, and we're getting the top premium tier that you can get within YouTube of that, then you got to keep your content brand- safe and all that. And then I think part of it is our job to tell the story to advertisers of the value that we can get. And when an advertiser comes to us and sees, " Holy cow," you can move audience. Behaviors really do shift. We had one, I won't say which advertiser, but they actually asked us to take out their ad from the last year because it was performing too well. It had a promotion tied to it. That was the first time I'd heard that happening. It was wild. It was earlier than it was supposed to go down, but I think that the promotion was doing a little too well. I think some are getting educated on the value and really seeing it, and you'll see a lot of them spend significantly and lean into YouTube. That usually takes a very senior advocate within the companies we're seeing who maybe got that trial budget and then really sees the value and goes all in. Obviously, it's not for every brand. I don't know that every brand is perfect for YouTube creators, although at this point, there's pretty much a creator for every single thing you can think of.

Conor Begley: It's like, my cofounder, he's like, " Yeah. I follow this guy that talks about watercolor painting supplies." Just every niche imaginable, I think, exists.

Marc Hustvedt: That's probably what makes it so exciting. This is a really long tail. This isn't just like, State Farm needs to spend more money in YouTube and less on TV or something. I do think that the CPMs certainly could be higher on some of the platforms and I think that the ultra- short form has got to get figured out. TikTok and Shorts both need to make a monetization model that makes more sense for the attention that they're grabbing. At scale, for us, it's less of a priority to be unit profitable on a TikTok, especially when we can do a brand integration every now and then on TikTok, and then ultimately build our own ventures, which... That's where CPG and all the traditional brands really need to watch out. You either get on board this or you get competed out of market share.

Conor Begley: And you're talking about Feastables.

Marc Hustvedt: Yeah.

Conor Begley: You're talking about... Yeah. Yeah.

Marc Hustvedt: Yeah. We launched-

Conor Begley: Or MrBeast Burger.

Marc Hustvedt: ...a year ago... Well, I mean, it was January 29th of last year, so a little over a year ago, launched Feastables, and is now meaningful. It was started with chocolates with MrBeast Bar. Better- for- you snack brand is really what it is, and it started in confections. We're going to expand, of course, beyond that. There's a bunch of new products coming. We just launched Deez Nutz, a fun, comical... It's actually peanut butter in the middle with two milk chocolate layers sandwiching it. It's been a real hit with the kids, and we had a fun ad that just went up the other day.

Conor Begley: Well, I mean, you're seeing it, right? Obviously, Rihanna got a lot of attention for the Super Bowl, but her brand, Fenty Beauty, is doing$1 billion in sales a year, and her other brand, Savage X Fenty, I think is valued at$ 3 billion. You got The Rock with Teremana. That's a multibillion- dollar enterprise at this point. Yeah. There's just a ton of them. Right?

Marc Hustvedt: And then you saw Logan and KSI talking about their PRIME sales, which are just incredible.

Conor Begley: Totally.

Marc Hustvedt: And beverage is hard. They went after a tricky one. Really not a D2C play. It's all retail, and I think that's also the retailers are finally waking up. They're seeing that this demand generation that you're doing with... Basically, I mean, you're just lowering your CAC, if you will, with making all this digital content. And it's not just a one- off pop, it's continuing. They're rebuying. It means something special. You're connecting way deeper to the consumer. You don't have that relationship with name any other random drink in the drink aisle or another candy bar that's sitting on the aisle, like Butterfinger or Hershey. I mean, Feastables is outselling them, Mounds, Almond Joy, all that stuff.

Conor Begley: That's crazy. What?

Marc Hustvedt: We get the IRI data. It's wild to see it.

Conor Begley: And for those that don't know, IRI is like a Nielsen or an NPD where they track sales data in retail stores. So what percent of the income if MrBeast, the organization... What cut of the pie? Is it 5%, 10%, 20%, 50%? Obviously, it's growing very quickly, and just include all the branded products versus the ad revenue.

Marc Hustvedt: Yeah. It's a good question. We don't want to get too specific on our revenue breakdown, so I got to be a little respectful, but I'll definitely say, look, you're into the media business becoming less and less of the overall pie even as it grows, because of just the scale of retail distribution is massive when you're doing millions of dollars a week in a single store. So you've got this totally different economics.

Conor Begley: There's a lot of Walmarts out there.

Marc Hustvedt: Yeah. We're in all 4,700 Walmarts. A lot more retail coming. And Walmart's been a great partner too. It's like, very deep to the Beast history is working, doing content in Walmart and whatnot, and it's been a lot of fun. And again, they've been great partners throughout it. And we kind of learn the pain of how slow retail really works. You have to plan, like to get in frozen. It's something like, you're planning for next January already, and it's just that the refresh cycles are slow, and sometimes great creative idea comes up and you make content real quick. And it's amazing what a creator can do on a weekend, and then getting that product into retail is nine months to get it. So we have a big road map this year. I just wish some of it moved faster, and I think the retailers are going to have to evolve their organizations to basically hold shelf space and hold these fast lanes into it, and even just restocking the product is really slow. I didn't realize how slow that was, unless you're a true scale, where you're like Frito- Lay and you've got an army of trucks all over the country and all running into these little gas stations and stocking them for you. It's a supply chain issue that's sort of wacky, but...

Conor Begley: Yeah. Totally. So I just saw a lifted truck drive by your window, so let's talk about North Carolina for a second.

Marc Hustvedt: That's where we are.

Conor Begley: So I'd be curious. So Greenville, I actually should have looked up the population, but it's probably not a very big place, I'm guessing.

Marc Hustvedt: It's about 100,000 people.

Conor Begley: Yeah.

Marc Hustvedt: There's a pretty decent- sized university, East Carolina University or ECU.

Conor Begley: Oh, okay. Okay. Okay.

Marc Hustvedt: If you didn't have that here, I think it would be probably a lot smaller, because that's got to be 30, 000 people, plus all the hospital. The two things here are this university and then this giant hospital that they have because it serves all of the regions. It's something like 20 or 30 counties are served by this one big hospital, because it's really rural out here. I didn't realize how rural Eastern North Carolina is, and I just assumed all the East Coast was pretty developed, and I grew up in Boston. And anything as you went down the coast, New York, D. C., you had these big cities. But you get down here, it's all farmland. And so, that's basically what's happened here. Most of the big cities you know about, like Raleigh and Charlotte, those are actually pretty inland. So even flying here, you fly into Raleigh, if you're coming from L. A. or New York, and then you have to drive an hour and a half east and you'll get to Greenville. It's a trek. There is a small airport here, but it has two flights a day that go to Charlotte. That's about it.

Conor Begley: Yeah. So has there been an actual effect on the community? I mean, 100, 000 people. It's tough to have an effect. It's a pretty good- sized city. But obviously, the name recognition of Greenville has to have increased pretty dramatically.

Marc Hustvedt: Yeah. We're actually doing an economic impact study with the university, and it's not done yet, but just hearing some of the early numbers, I'm like, " Wow, this is wild," because when you look at just... We're up to over 200 employees full- time here and then there's just a number of part- time that we'll employ, plus all of the contractors, and we're bringing people in from all over the world. I mean, we'll literally spend tens of millions of dollars a year in content made here in Greenville, and that's often directly whether we're ordering food from the restaurants, ordering from the local stores, and we're employing all kinds of different builders, people who build little ditches, and have all these crazy machinery. And what's also great is they're not jaded Hollywood vendors who just have been doing it and got these crazy rates. It's often like, " Random guy with a huge crane." And we had one thing where we had to have a crane to build another crane. I didn't know that was a thing, but they bring in this one crane, like, " Is that the crane we're using?" Like, "No, no, no. That's the crane to build the crane." And then that lifted up this giant meteor that we smashed into a house. But anyway, it's a significant economic impact in the area and I think that's part of... Combine that with what Beast Philanthropy has going on. It's something over four million meals delivered so far in the area, so it's pretty impressive. It's very much a Beast scale, and I think it's why the community has been really receptive to us. There's definitely towns in the area that are like, " We're happy to have you guys film here because you're also feeding our people." The philanthropy, it's like a hub- and- spoke model where it's a food bank based here, it's a full- owned warehouse, and there's a big walk- in fridge and walk- in freezer, and they're basically making these healthy boxes of surplus farm food, and then brands are donating food. And we'll do pop- ups basically once a week in all of these different counties, and I think that's also really helped. So I think the community is a big partner.

Conor Begley: So one of the things that's going around in my head as you talk is thinking about age, which is, Jimmy is 24. What does this look like in 20 years or 30 years? And really, if you start forecasting out that far, it gets a little weird, assuming that you maintain steam and interest from the organization from him. What do you think that looks like? What would be your predictions for that?

Marc Hustvedt: I mean, the scale already is a little mind- numbing. When we looked at the footprint, it's something like 400 million followers on when you add up the subscribers and followers, and obviously the billions of views a month. So I think in the near- term horizon, it's like, " Okay, what does it look like to have 500 million YouTube subscribers?" And even those subscribers, I think we all know, doesn't necessarily mean the views are there.

Conor Begley: One thing, I don't subscribe when I watch.

Marc Hustvedt: Yeah. It might even just be sort of this legacy behavior, but it is still a proxy to grow.

Conor Begley: Yeah. Yeah, yeah.

Marc Hustvedt: What does a billion look like? What does a billion uniques a month look like? Unique human beings interacting with your brand. And then what could you do with that? That seemed like a fantasy at one point. Now it's a reality and we need to prepare for that and build for that and get global with like, Feastables needs to be international. That's a big thing this year, because if our content is fully global, the ventures also need to catch up and be there too. But in terms of, Jimmy's age is wild when you do think about it because I've now worked with so many different eras of creators, and there definitely is an evolution of them, and I think the job requires an immense amount of stamina. And he's, in some ways, that Mahomes early in his career. If we saw something, Pat Mahomes of the Chiefs is like probably the new... They're going to say, " Could he be the new Brady one time at some point?" Maybe. I'm a huge Tom Brady fan and went to Michigan with him, so I'm like, " Brady is always the GOAT." But in all seriousness, Mahomes is young and still in that early part of the journey, and it's wild to think in five years, Jimmy still won't be 30.

Conor Begley: Yeah. Five years.

Marc Hustvedt: It blows my mind. So I don't know. I can't predict 20 years out. I mean, you're getting into just-

Conor Begley: It's weird, though, right? What's 20 years from now?

Marc Hustvedt: Yeah.

Conor Begley: You start thinking about some of these lasting institutions. You think about Disney. Right? It's 100 years old. What do YouTubers or creators look like that kind of stand the test of time, and what's that mean for broader media companies?

Marc Hustvedt: I think there's no doubt that Jimmy as a human and a person will certainly be a pretty impressive figure in our world doing things that'll probably blow our minds with the environment and other things, and then you really sort of harness that influence in helping people eat healthier and all these things. But I was having this conversation with somebody else about, " What's your 100- year plan? Are you guys planning to be a 100- year company?" I mean, we always measured success of corporations, and maybe it's sort of a thing with capitalism or something, that they all need to be 100 years or 200, like that is success that they can just last forever. And I was sort of taking the contrarian approach, which is, they only need to last as long as the creator is really into it. I mean that in a way that's like... I'm not saying that the business couldn't exist without the creator. I'm just saying that maybe we need to redefine our definition of success in business. The gist of it really is, I don't know if it's 100- year brand, but I think when it is highly relevant and doing great work and on this journey, that it can move the ball forward in a lot of different areas and then that could have been its purpose, and then, in doing so, also entertained a lot of people and launched all kinds of things. But who knows? Jimmy might also be Tom Brady and go for decades and decades, and who knows?

Conor Begley: Yeah. I'm really curious.

Marc Hustvedt: inaudible. Yeah.

Conor Begley: It's just weird forecasting out that far.

Marc Hustvedt: Yeah.

Conor Begley: I mean, at some point, you've got artificial intelligence that's going to take over too.

Marc Hustvedt: Yeah.

Conor Begley: I've already used up more time than I was supposed to, but I really appreciate it, Marc.

Marc Hustvedt: Yeah.

Conor Begley: I do want to finish with one fun end- of- show question. So being a media guy, been in media for a very long time, what do you watch personally? Are you a TikTok guy? Do you do Netflix? What's your consumption like? What are you watching?

Marc Hustvedt: I mean, we have to watch YouTube. If you don't watch YouTube, you shouldn't be making YouTube. That's a general philosophy of what we've got. So whether it's Ryan Trahan or Michelle Khare or Airrack or really this new generation of YouTube creators, I'm certainly watching them. It feels a little more like work, if I'm being honest, to step out into traditional. Last of Us, I'm watching right now. Super hooked into that. And I wasn't that into the game, but it's fun to hear the comparisons, especially there's a little after- show podcast, started getting into that. So it's interesting to listen to how they adapted the game, and it's actually really good, in my opinion, for the gaming industry, which hasn't had a whole lot of success in that, so seeing an adaptation break through. I watch live sports too. I'm still there, and then TikTok. I think it's hard not to watch TikTok. I think anybody who works in the internet in any sort of way, whether you work in the internet or not, culture is really happening and rapidly evolving on TikTok, and it doesn't matter what your niche is. I think even the way we communicate the patterns and styles of how to break through, especially to a younger generation, you've got to be watching TikTok.

Conor Begley: Totally. Thanks again, Marc. I appreciate it.

Marc Hustvedt: Thanks, Conor. Appreciate it.

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