Creators Could Rule the Fortune 500 in the Next Decade
For decades, America’s Fortune 500 has been ruled by executives with a predictable pedigree: ambitious leaders who have cut their teeth in entrepreneurship or worked their way up to a top seat.
It may be ironic then, that the advancement of technology through some of the brightest minds in business, has democratized entrepreneurship — a process that is changing the face of corporate America and allowing pop icons to become business moguls.
Take Kyle Forgear and Jesse Sebastiani — known for performing pranks and promoting a hard-partying lifestyle on their YouTube channel NELK. The YouTubers don’t fit the typical mold of a business executive, but they could represent the future of entrepreneurship.
Despite having 6 million subscribers, YouTube demonetized NELK’s channel for not meeting its advertising guidelines, forcing the duo to seek out new revenue streams. In response, the NELK boys launched Full Send, a company that regularly sells out of its limited edition merchandise drops and reportedly brought in over $70 million in annual revenue in 2020. In 2021, the NELK boys launched Happy Dad, a hard seltzer alcohol brand sold 2.6 milion cases in 2022 alone.
With cloud computing, social media and affordable e-commerce platforms lowering the barrier to entrepreneurship, creator-led brands are on the rise. The creator market was estimated to be worth more than $104.2 billion in mid-2022.
The potential of creator-led businesses, however, is still being unlocked. As the internet’s pop culture icons find their foray into business, here’s what needs to be considered.
The Danger of Vanity Branding
Before MrBeast became the world’s most coveted creator, PewDiePie held the top spot for nearly five years. Before PewDiePie, there was Ray William Johnson and Jenna Marbles — internet stars from the early 2010s — who the term “YouTuber” was coined after. Aside from MrBeast, none of these YouTubers are consistently active on the platform.
The lifespan of a creator can be as short as the content they create, which is why those seeking to build a business with longevity need to think carefully about separating their company from their content career.
Logan Paul and KSI, two of the world’s most famous YouTube personalities, are showing how this can be done. In January 2022, the YouTubers launched Prime Hydration, a beverage brand that reportedly generated $250 million in sales in its first year.
The duo’s combined 36 million subscribers have undoubtedly helped with the brand’s success, but ultimately, their keen understanding of the platform’s algorithm combined with modern marketing techniques — like limiting the product’s supply to generate scarcity-led demand — have allowed them to reach consumers unfamiliar with their platform. As such, Prime has the potential to live on as a business long after their internet fame rescinds.
The Rolling Stone Culture Council is an invitation-only community for Influencers, Innovators and Creatives. Do I qualify?
For creators looking to make the leap from content generator to business owner, it’s important to consider how long they will be in the spotlight and whether or not their brand can continue to gain momentum when their spotlight dims.
Lessons From Hollywood
Creators aren’t the first pop-culture figures to enter into commerce. Long before social media stardom, there were celebrity-owned tequila brands and athletes with stakes in restaurants and sports teams. With the advent of tech, however, we have seen a shift in power towards talent.
Celebrities like Jessica Alba, who was a named founder and had a $130 million stake in the Honest Company, when it went public in 2021, have set a new blueprint for talent monetization beyond brand partnerships.
Perhaps nowhere is the powershift between artists and brands more amplified than through the recent divorce between Adidas and Kanye West. The breakup came with a fourth-quarter loss of $540 million for the legacy sneaker brand and the company has projected to lose $1.3 billion in sales from unused clothing and shoes.
As traditional celebrities and artists have paved the way in building businesses beyond their IP, creators are starting to take note, recognizing the value they bring to partnerships and demanding to have skin in the game.
Demanding Skin In The Game
As creators start to realize their earning potential beyond endorsements, brands are having to get more creative in their creator-led marketing initiatives.
Sephora’s accelerator program for indie beauty brands recently announced a partnership with TikTok to connect its founders with rising creators. While education and knowledge transfer are cornerstones of the program, it’s not unrealistic to think equity could be exchanged as partnerships emerge between indie brands and creators.
Taking a stake in an existing company is a great way for creators, who may not otherwise have the chops for entrepreneurship, to get into business, but it’s not the only path. Some creators are choosing to build their own brand from the ground up, but recognizing where they need support.
MrBeast, who launched his own chocolate bar brand, Feastables in 2022, brought in Jim Murray, the former CEO of RxBar, as co-founder and CEO of the operation. By bringing in a seasoned executive to help run operations, MrBeast can focus on what he’s good at — creating content and innovative marketing experiences — and leverage his co-founder’s operational expertise.
The future of creator-led brands is yet to be determined, but as we see creators carve out a new place in commerce, what’s clear is how we engage and discover consumer brands is about to change. And if creators play their cards right, the face of the Fortune 500 could look very different in the next decade.