Speaker 1: Book of a strictly business varieties weekly podcasts featuring conversations
Speaker 1: about the business of media and entertainment.
Speaker 2: I'm TV business writer Jennifer Moss.
Speaker 1: Nebula, which launched in twenty nineteen, describes itself as a
Speaker 1: creator focused, creator built, creator first premium streaming service akin
Speaker 1: to a Netflix or Hulu, but with the athos of Patreon.
Speaker 1: The four year old indie streaming service, which is backed
Speaker 1: by creator owned management company Standard and a minority stake
Speaker 1: held by Curiosity Stream, costs five dollars a month or
Speaker 1: fifty dollars a year to subscribe to. It currently tolls
Speaker 1: six hundred and fifty thousand subscribers and past one hundred
Speaker 1: thousand daily active users in October. Nebula is home to
Speaker 1: the popular amazing race style online competition series Jetlag The Game,
Speaker 1: which is half a million subscribers on YouTube, as well
Speaker 1: as the Theater in the Round, Shakespearean trans Coming Out
Speaker 1: Story of the Prince, and Night of the Coconut, the
Speaker 1: debut film from Patrick Wilms. Unlike other streamers, Nebula sees
Speaker 1: YouTube as a partner, not a competitor, with episodes of
Speaker 1: Nebula series usually seeing a week long exclusive window on
Speaker 1: Nebula before creators post them to YouTube and use them
Speaker 1: to in turn promote Nebula. In August, Nebula named jet
Speaker 1: Lagstar Sam Dunby its first chief content officer, and is
Speaker 1: currently promoting its fall lineup of originals. We'll be back
Speaker 1: with Dave after this break here to talk about the
Speaker 1: growth of the indie platform and plans to expand on
Speaker 1: its slate of original series on today's Strictly Business podcast
Speaker 1: is Nebula CEO Dave Whiscus. I'd like to start with,
Speaker 1: just for our audience members who might not be familiar
Speaker 1: with Nebula, what is it in your own roof?
Speaker 3: There should be an easier answer to this question. Makes
Speaker 3: it complicated is that nothing like this has really been
Speaker 3: achieved before. And I don't necessarily mean that in a
Speaker 3: grand standing sort of way. It's just that it always
Speaker 3: ends up being like a tech company who tries to
Speaker 3: do a thing with creators, or an entertainment media company
Speaker 3: who tries to do user generated content stuff like Quibi
Speaker 3: or something. It's never the creators starting their own thing
Speaker 3: and then like really landing it. And in our case,
Speaker 3: it's a group of creators who got together because we
Speaker 3: saw that very simply on a creator career path, step
Speaker 3: one is YouTube or whatever, and step say ten is Netflix.
Speaker 3: The problem is where are steps two through nine? If
Speaker 3: we want that to exist, we want to build that bridge.
Speaker 3: We have to build it. And so the purpose of Nebula,
Speaker 3: the thing that we're building, the thing that we have built,
Speaker 3: it is intended to be a way for the creators
Speaker 3: to to sort of traverse the the vast space between
Speaker 3: user generating content and more traditionally accepted forms of media
Speaker 3: and entertainment. And it's it's almost a fraught answer to
Speaker 3: say to focus on, like what the creators get out
Speaker 3: of this, But what we've learned is that so much
Speaker 3: of the relationship, so much of what makes this this
Speaker 3: kind of thing powerful, is the relationship between the audience
Speaker 3: and the creator. That's where we win. It's that sort
Speaker 3: of parasocial dynamics. So for the audience at the base level,
Speaker 3: earliest days, it's about getting access to things early, it's
Speaker 3: about getting access to behind the scenes content. Not this
Speaker 3: similar from like the value proposition of a Patreon or
Speaker 3: something like that. As we look out into the future,
Speaker 3: we've always been building up our originals, building up our
Speaker 3: stable of you know, content that is made here and
Speaker 3: in the case of like a jet lag might end
Speaker 3: up also on YouTube as a way to pull people in,
Speaker 3: but things that have our logo on it. The idea
Speaker 3: is a little bit less Patreon, a little bit more
Speaker 3: a twenty four which can be a brand definition here's
Speaker 3: what creators are capable of. And then step three in that,
Speaker 3: I guess, is Nebula being more of a Netflix style
Speaker 3: destination home for really great things that are made by
Speaker 3: people who might not have had the opportunity or the
Speaker 3: means to do those projects within the traditional Hollywood system
Speaker 3: or traditional media system.
Speaker 2: What is again asking you to define here?
Speaker 1: Standard which is a company that is behind Nebula and
Speaker 1: existed preceded Nebula's launch.
Speaker 3: Very simply a talent management company. We work with a
Speaker 3: bunch of creators. We book sponsors on their shows and
Speaker 3: help them develop their businesses. And along the way we
Speaker 3: realize that there are some gaps in the industry, like
Speaker 3: around licensing and things like that, and we had been
Speaker 3: working We've been chatting with YouTube back when they were
Speaker 3: still doing originals. They had asked us for some pitches
Speaker 3: for original shows. We sent them over and they kind
Speaker 3: of never got back to us. So we decided, no, what,
Speaker 3: We're going to start our own streaming video platform.
Speaker 4: So standard is there to help creators build and guide
Speaker 4: and run their business operations, and Nebulas is kind of
Speaker 4: a consequence of that.
Speaker 1: When we're exactly if you remember where and when where
Speaker 1: Nebula came from and what was part of the we
Speaker 1: can actually make this work when something like a Vessel
Speaker 1: did not work.
Speaker 3: Yeah, I think Vessel was like as a technology driven
Speaker 3: technology solution made by technology people. There's business, there's technology,
Speaker 3: there's maybe some entertainment media in there. I don't want
Speaker 3: to comment too hard on them. But for us, it
Speaker 3: came organically. We had been approached by the group that
Speaker 3: was building what became Peacock in the end, wanting to
Speaker 3: bring like user generated content stuff onto a new platform
Speaker 3: they were building. They wanted to talk licensing, but how
Speaker 3: they approached the licensing deals it sort of didn't make
Speaker 3: much sense because it would be wildly different from creator
Speaker 3: to creator, and we kind of wanted to take the
Speaker 3: collective bargaining power, the leverage that we had as a
Speaker 3: as a group and kind of get everybody a more
Speaker 3: consistent deal. At the same time, we were being approached
Speaker 3: by Vimeo, the lovely people at Vimeo who they were saying,
Speaker 3: they picked one creator and they said, this person should
Speaker 3: have their own streaming service. We can build an over
Speaker 3: the top solution and empower that streaming service as well.
Speaker 3: That guy makes a video every three months. What kind
Speaker 3: of streaming service would that be? You're paying what five
Speaker 3: dollars a month for a content catalog of sixteen videos?
Speaker 3: Come on like that doesn't And they said, do you
Speaker 3: have any other creators who are more frequent, who for
Speaker 3: whom that would make sense? And said, well, no, The
Speaker 3: only way that would really make any times as if
Speaker 3: it were all of the creators, And oh, oh, that's
Speaker 3: an idea. What if we did that? And looking at
Speaker 3: the over the top streaming solutions at the time, how
Speaker 3: cheap it had gotten, and how doing something like that
Speaker 3: could provide a content licensing engine. Potentially there were multiple
Speaker 3: problems that could be solved at once, the licensing thing
Speaker 3: and you know, building out some sort of test bed
Speaker 3: of a new business venture for creators. And I took
Speaker 3: the idea to it. This would have been i want
Speaker 3: to say, November of twenty eighteen October November of twenty eighteen.
Speaker 3: I took to the creators and I've put this long
Speaker 3: email like here's kind of what I'm thinking, here's my
Speaker 3: vision for this. And I expected it would be a
Speaker 3: six month climb to convince everybody like, let's get it,
Speaker 3: let's get everybody on board. I knew that I could
Speaker 3: because it was just it was inexpensive enough that there
Speaker 3: wasn't a ton of risk in it, which had to
Speaker 3: come up with enough value proposition to the creators. So
Speaker 3: I figured out, well, give me six months and I'll
Speaker 3: eventually get everybody there. I sent out the email and
Speaker 3: instantly every single creator was like, we have to do this.
Speaker 2: Let's go getting going doing that. I know you will.
Speaker 1: Started with I think it's one hundred thousand dollars to
Speaker 1: get Nebiella actually ready for a launch.
Speaker 2: Where did that from? I know you didn't have venture capital.
Speaker 3: The extent that that can be true, it is true
Speaker 3: because the calculus there is how much were we paying
Speaker 3: the engineer who was working on it for the time
Speaker 3: that they are the engineers who were working on it
Speaker 3: over the time that they spent working on it. It
Speaker 3: wasn't like we wrote a hundred thousand dollars check. It's
Speaker 3: more like we as a business standard. We have a
Speaker 3: whole what you can call it. We have a back
Speaker 3: end software that we developed, the help power like Creator Things,
Speaker 3: this booking of sponsors and voicing stuff like that. It
Speaker 3: was sort of like a little mini sales force for
Speaker 3: Creator Things, and we've been building that since twenty seventeen,
Speaker 3: twenty eighteen, oh, twenty seventeen. The engineering team was working
Speaker 3: on it when we were looking at doing an over
Speaker 3: the top video solution. Well, like I said, we're talking
Speaker 3: to Vimeo, but they wanted to own the credit card relationship.
Speaker 3: And coming from my years of working with Apple as
Speaker 3: a designer, I was keenly aware and my years of
Speaker 3: being a musician, I was keenly aware that what made
Speaker 3: the iTunes music store work is that when you want
Speaker 3: another song, Apple already has your credit card number, you
Speaker 3: just press a button. And what made the app store
Speaker 3: work is that when you want that new app, Apple
Speaker 3: already has your credit card number and you press a button.
Speaker 3: By giving Vimeo full ownership of the credit card relationship,
Speaker 3: we would potentially be cutting ourselves off future opportunities where
Speaker 3: we could do cool, interesting you know, integrations of sorts
Speaker 3: by virtue of just you know, we don't even own
Speaker 3: the actual relationship, and you know what if things fell
Speaker 3: apart with that company, anything had happened, we don't want
Speaker 3: to We don't want to cut off all future possibilities.
Speaker 3: And so we found a different partner instead, and it
Speaker 3: required a little bit of development effort on our side.
Speaker 3: So we just we knew we could either reassign an
Speaker 3: engineer or make one more higher, and so we just
Speaker 3: made one more higher onto the team. And then as
Speaker 3: the project developed, it became a little bit more complex
Speaker 3: when we made a second higher and I think we
Speaker 3: only had the two people. By launch, there was like
Speaker 3: two engineers working on it, which is where we came
Speaker 3: up with the number like those two engineers over that
Speaker 3: period of time, roughly one hundred k. Not an exact
Speaker 3: science on that. It's hard for it to because they
Speaker 3: were also working on other stuff at the same time,
Speaker 3: but the money came from Standard was profitable. We had
Speaker 3: those resources and the intent was always let's keep reinvesting
Speaker 3: our successes into building more successes. And this was a
Speaker 3: thing that felt like it could potentially become something. We
Speaker 3: had no idea that it would turn into this. I mean,
Speaker 3: I guess we had hopes, but even our hopes, it
Speaker 3: never quite This never seems possible, this never seemed.
Speaker 1: Realistic talking about what it has turned into. This is
Speaker 1: and correct me if any of this is out of date.
Speaker 1: But currently Nebula is valued at one hundred and fifty
Speaker 1: million and there are six hundred and fifty thousand paying
Speaker 1: users and that's still with no venture capital funding.
Speaker 3: Pretty close Standard. The valuation is on Standard because it's confusing.
Speaker 3: Standard is the company that owns Nebula, and while Nebula
Speaker 3: is technically a separate LLC for a handful of reasons,
Speaker 3: when we talk valuation, we're talking about the entirety of
Speaker 3: the machine. So much of the creator relationships and audience
Speaker 3: relationships and partnerships and everything happened up at the stand
Speaker 3: undred level, so it's kind of it's hard to fully
Speaker 3: disconnect the two. But in that number, when we came
Speaker 3: up with the number, it was based on like the
Speaker 3: totality of everything that we're doing, okay, and then the year, Yeah,
Speaker 3: six hundred and at the moment, like six hundred and
Speaker 3: eighty thousand, okay, And.
Speaker 1: Then I believe you tweeted recently that Nebula just passed
Speaker 1: one hundred thousand daily active users.
Speaker 3: Yeah, that was a fun one, and we're we're getting
Speaker 3: close to three hundred thousand monthly active all right.
Speaker 1: So with that behind it, you know, we've talked a
Speaker 1: lot about the business mechanics of getting it launched first,
Speaker 1: but where are those views coming from the content on Nebula?
Speaker 1: What can you explain what the system is and the
Speaker 1: current funneling of the exclusive window of this content before
Speaker 1: creators post it elsewhere like on YouTube.
Speaker 3: It's really to choose your own adventure story as a creator.
Speaker 3: If you want to make things that only live on Nebula,
Speaker 3: you can. If you want to make things that live
Speaker 3: on Nebula for a week and then go to YouTube,
Speaker 3: you can. We have different naming structures for these things
Speaker 3: to try to disambiguate it for the audience, but the
Speaker 3: intent is that Nebula is like the canonical home of
Speaker 3: the things that these creators make. And in the case
Speaker 3: of jet Lag, the business model is built around the
Speaker 3: YouTube version that every video ends with a cliffhanger that
Speaker 3: makes you want to go sign up for Nebula that
Speaker 3: was baked in from day one. That's always been the plan,
Speaker 3: and that works very effectively. And there are some creators
Speaker 3: who they were able to get ahead on schedule, and
Speaker 3: you know, maybe they make one video per month, but
Speaker 3: they got a head on schedule. So the video always
Speaker 3: goes to Nebula, and then last month's video goes to
Speaker 3: YouTube at the same time, and we call those Nebula. First,
Speaker 3: there's full on Nebula original productions which will only ever
Speaker 3: be on Nebula, and then there's like bonus content kind
Speaker 3: of DVD extras we call Nebula. Plus. The way that
Speaker 3: the audience comes in sort of depends on the creator.
Speaker 3: For some creators, they sign up because they really want
Speaker 3: to see the next video. For some creators, the audience
Speaker 3: signs up because there's bonus stuff that they really want
Speaker 3: to see. For some creators, many creators, it's talking about
Speaker 3: the originals is what pulls people in. And then there's
Speaker 3: of course the people who come and sign up just
Speaker 3: because they want to support the creators. Again, I think
Speaker 3: that what makes us so different and what's hard for
Speaker 3: more traditional systems to it's hard to fit us in
Speaker 3: with more traditional systems because the audience, a large portion
Speaker 3: of the audience signs up for Nebula because they believe
Speaker 3: in us and they want to support these creators. I
Speaker 3: don't think Disney has that kind of relationship. I don't
Speaker 3: think Netflix has that kind of relationship.
Speaker 2: We'll be back with more from Dave after this break
Speaker 2: into Netflix. I know there was a stot that.
Speaker 1: Nebula is second only to Netflix and customer retention.
Speaker 2: How do you guys measure that churn?
Speaker 3: We're using antenna data for that. I believe Netflix is
Speaker 3: three point six percent churn rate and the purported number
Speaker 3: two Disney plus is around four and a half percent
Speaker 3: turn rate based on the last numbers that we saw,
Speaker 3: and we, depending on where we are in a month,
Speaker 3: hover between like three point eight to four percent. So
Speaker 3: according to Antenna data, if they were to classify us
Speaker 3: in the same ranking, we would be number two for
Speaker 3: customer attention, behind Netflix.
Speaker 2: What would you say is the biggest factor keeping that
Speaker 2: churn rate for you?
Speaker 3: I think the audience just really loves the creators. They
Speaker 3: want to see the creators succeed, and when they come in,
Speaker 3: they stay because they're they're invested in the story. And
Speaker 3: the cheap cop out retort to that would be that
Speaker 3: so many of our customers come in like overall, a
Speaker 3: little over fifty percent of the people who sign up
Speaker 3: for Nebula sign up for annual plans, So of course
Speaker 3: monthly train is going to be low. And Netflix doesn't
Speaker 3: offer an annual plan. I don't believe many of the
Speaker 3: big streamers don't, which is weird. I've got thoughts on that,
Speaker 3: But I would argue that the reason that our customers
Speaker 3: sign up for annuals so heavily to begin with is
Speaker 3: because they they know what they're getting into, they're committing.
Speaker 3: They know that we get more money up front, they
Speaker 3: know that things are going to grow and evolve over time.
Speaker 3: They know that they're going to get more stuff. Why
Speaker 3: wouldn't they spend thirty bucks? And I think that's what
Speaker 3: it comes down to. They believe in what we're doing.
Speaker 3: They want to see how this unfolds, and they're making
Speaker 3: a one year investment.
Speaker 1: In that story, we mentioned jet Lag, but I'm going
Speaker 1: to go into a little more specifically now, the travel
Speaker 1: game show that I'm obsessed with and the reason I
Speaker 1: signed up for Nebula. When I first discovered jet Lag,
Speaker 1: I watched everything currently available on YouTube, and I believe
Speaker 1: we were in the middle of one of the seasons
Speaker 1: at that point. Then I went and signed up Fornibula
Speaker 1: because I wanted to see what was currently there. We
Speaker 1: got you, Yeah, you got me, and I watched Crime Spree,
Speaker 1: which for people to know that was like the unoffsual
Speaker 1: first season that's only available to stream on Nebula. So
Speaker 1: I'd love to get an idea during a season of
Speaker 1: jet Lag or if you have another example of another
Speaker 1: show that has that same format on Nebula, what do
Speaker 1: sign ups look like? What is kind of the bump
Speaker 1: that you get from something like that, especially given that
Speaker 1: if I wanted to, I could wait and watch it
Speaker 1: all on YouTube, you.
Speaker 3: Could, or you could sign up. It's thirty bucks a year,
Speaker 3: which comes out to be two dollars and fifty cents
Speaker 3: a month. You know, we've done premiere events where if
Speaker 3: you're a Nebulus subscriber you get to it's first come
Speaker 3: for serve. But if you're a Nebula subscriber, you can
Speaker 3: just come to the premiere let us know. We'll get
Speaker 3: you to the spot, and the spots usually I say
Speaker 3: sell out, they're free. The spots sell out like within minutes,
Speaker 3: and we'll get every single time we'll get one or
Speaker 3: two people who are like, if I'm not signed up
Speaker 3: for Nebula, can I just buy a ticket? And the
Speaker 3: answer is yeah, it's thirty dollars and it comes with
Speaker 3: a free year of Nebula. Like, it's thirty dollars. Your
Speaker 3: uber to the venue is going to cost you. That
Speaker 3: the price point is so low, especially relative to other streamers.
Speaker 3: I'm not saying that this is no money, and I
Speaker 3: don't want to ignore that that there's income disparity. I
Speaker 3: don't want to make that assumption. But when you consider
Speaker 3: the emotional attachment that the audiences tend to have, and
Speaker 3: for a show like jet Lag, people really love Sam
Speaker 3: and Ben and Adam, they love them. The jet Lags
Speaker 3: are kind of intense about it. They're the they have
Speaker 3: a lot of fun. We get fan art. I get
Speaker 3: fan art. I'm not even on the show. Jet Lag.
Speaker 3: Fans drop pictures of all of us and they are
Speaker 3: constantly discussing us on Discord and on Twitter, and they
Speaker 3: just really, really really love the show and that kind
Speaker 3: of emotional attachment. Of course, they want to see the
Speaker 3: next episode. When something can reach people and bring a
Speaker 3: little bit of joy like that, and it has that
Speaker 3: spirit of independence. It's not a big budget Hollywood style
Speaker 3: game show production that's all full of spectacle, and like,
Speaker 3: this is people doing a thing that it looks like
Speaker 3: you could do that. We get people asking all the time,
Speaker 3: can you make like a home version that I could
Speaker 3: play with my friends, or can will you sell the
Speaker 3: cards so that I can do the same thing. But
Speaker 3: we're careful about that because I don't want to encourage
Speaker 3: people to jump on planes or do anything that annoys
Speaker 3: other people. And a bigger conversations we had about how
Speaker 3: a thing like that could be done ethically. I know
Speaker 3: that the jet Lag team works really hard to make
Speaker 3: sure that anything they do, like when they film, they're
Speaker 3: always consciously people's privacy. They're not out there to be
Speaker 3: like you know, jerk YouTubers getting everybody's way, and so
Speaker 3: coming up with a way to share that that isn't
Speaker 3: encouraging people to be obnoxious as something, but that kind
Speaker 3: of relationship when an audience loves to show that much,
Speaker 3: and when it's that easy to project yourself in or
Speaker 3: feel like you're friends with these people, of course you
Speaker 3: want to hit the button. That's not the hill to climb,
Speaker 3: you know, A five dollars a month or thirty dollars
Speaker 3: a year hill to sign up for that not insurmountable,
Speaker 3: and so we do see a pretty big bump obviously
Speaker 3: when jet Lags on air, we conversions sign ups for
Speaker 3: jet Lag go up dramatically, but it kind of happens
Speaker 3: that way. We have shows that drive huge numbers. Interestingly,
Speaker 3: by various metrics, jet Lag is not our number one show.
Speaker 3: It is, I think by audience engagement in terms of
Speaker 3: just people being excited about it and sending us fan art,
Speaker 3: certainly our number one show, but not always by watch time,
Speaker 3: not always by sign ups. So whenever certain kinds of
Speaker 3: projects go out, I think jet Legs are our only
Speaker 3: travel or game show style thing at the moment in
Speaker 3: that format. We're working on some stuff, handful of things.
Speaker 3: We don't want to just make jet Lag two. We
Speaker 3: want to be really careful about one not saturating, but
Speaker 3: two not like, I don't know, diluting, if that makes sense.
Speaker 3: We want to reinvest our success into doing something creatively interesting,
Speaker 3: not just doing the same thing again. But there's a
Speaker 3: number of formats. Different creators work on different things. It's
Speaker 3: more about like audience depth and audience love will drive
Speaker 3: the big numbers.
Speaker 2: So with that all that said, why is.
Speaker 1: Jet LaGG not exclusively on Nebula, And that same question
Speaker 1: going for any really high trafficking Nebula stuff, and if
Speaker 1: those conversations have ever been had with those creators and
Speaker 1: why from a business standpoint, someone would see, well, obviously
Speaker 1: this does very well and it could do better if
Speaker 1: it only existed here.
Speaker 3: It's easy to think that what we're building is a
Speaker 3: YouTube competitor, and if you imagine it as a YouTube competitor,
Speaker 3: it's easy to think that anything we do from any
Speaker 3: creator we work with, the goal should be for it
Speaker 3: to be exclusively on Nebula. What we're really building is
Speaker 3: a Netflix competitor, and the path we're going to have
Speaker 3: to take to get there. YouTube is our biggest partner.
Speaker 3: YouTube is our closest ally. YouTube is the top of
Speaker 3: the funnel for us. We're just sold bit further down,
Speaker 3: and the way that the audience dynamics work, the YouTube algorithm,
Speaker 3: much maligned, is our greatest champion. It's out there finding
Speaker 3: new fans for us. It's out there finding new people
Speaker 3: who love the things that our creators make. And so
Speaker 3: we've designed our system, our entire business model around leveraging
Speaker 3: that to bring those fans to us. How often do
Speaker 3: you get, like an egga corporation building you a free
Speaker 3: machine to bring you audience first. I'm going to take
Speaker 3: advantage of that. Someday. It's entirely possible that any of
Speaker 3: our shows become exclusive to Nebula, not really by design,
Speaker 3: at least at the moment we have folks. Lindsay Ellis
Speaker 3: is one hundred percent exclusive to Nebula, not really by
Speaker 3: our request so much as hers. She sort of got
Speaker 3: tired of the way she was in the public eye,
Speaker 3: and she sort of wanted to approach her career differently,
Speaker 3: and we were supportive of that. He absolutely kills on Watschteim.
Speaker 3: Her fans love her too. But it wasn't because we're like,
Speaker 3: we must collect all of the things and they must
Speaker 3: all be hours. We're not like Thanos out there grabbing
Speaker 3: all the Infinity stones. We're not here to catch them all.
Speaker 3: I'm back to Pokemon. The goal rather is to build
Speaker 3: a bridge. I want to occupy a much more a
Speaker 3: twenty four style space where we work with the creators,
Speaker 3: we help them make the We help them make the
Speaker 3: things that they want to make, we help them develop
Speaker 3: as creators. I'm in La right now on set with
Speaker 3: Jesse Earl Jesse Gender, who's directing her first larger, larger
Speaker 3: budget short film, sci fi production, narrative fiction. We've got
Speaker 3: like panavision, camera and the actors you've heard of and
Speaker 3: all of this. And the idea is that if we
Speaker 3: provide Jesse with a structure that can help her become successful,
Speaker 3: she can actually become a real filmmaker. She has the talent,
Speaker 3: she has the skill, she has the ambition. It's for
Speaker 3: most of our creators, those aren't the gap. For most
Speaker 3: people on YouTube, those aren't the gap. It usually comes
Speaker 3: down to connections, funding and experience. And so what we're
Speaker 3: trying to do with Nebula is build a system that
Speaker 3: can provide the connections the funding and the experience and
Speaker 3: build a bridge so not everything has to be exclusive here.
Speaker 3: I would love it if we could live in a
Speaker 3: world where Jesse or other filmmakers we work with Patrick
Speaker 3: Williams start making movies that go to a wide theatrical
Speaker 3: release and there's some segment of the audience where the
Speaker 3: only thing they know Nebula as is the you know,
Speaker 3: the stinger that comes up before the movie starts, the
Speaker 3: same way that you would see the A twenty four
Speaker 3: logo or the sky Dance logo, Amble and Entertainment like
Speaker 3: these kinds of things. I guess the closest analog for
Speaker 3: the division is something like if A twenty four had
Speaker 3: their own streaming service, you can see everything everywhere, all
Speaker 3: at once on any of the things. But if you
Speaker 3: go to A twenty four saying you can see all
Speaker 3: of their productions, That's kind of how we're thinking about it.
Speaker 1: Okay, with that, I'm wondering if you can explain what
Speaker 1: the difference is between original content that lives on Nebula
Speaker 1: and a Nebula original.
Speaker 3: Is there a difference? Well, make sure.
Speaker 1: Underting you guys have a state of Nebula originals that
Speaker 1: you've announced coming in the fall, So I wonder what
Speaker 1: they are and why they're labeled that way, and what
Speaker 1: that means. A Nebula versus a creator whose content exists
Speaker 1: on Nebula if there are things commissioned by Nebula and
Speaker 1: that are owned by Nebula versus content that does a
Speaker 1: creator own it when it exists on there and is on.
Speaker 3: Nebula Ooh, there's a part of this question I'm really
Speaker 3: excited to answer. I'll save that part. So there's the
Speaker 3: it's a yeah, this isn't entirely intuitive and there's not
Speaker 3: a great solution for this. But the best way to
Speaker 3: think of this is if we are paying for it
Speaker 3: in total or you know, in majority, and we are
Speaker 3: providing our own production resources. We have an entire Nebula
Speaker 3: Studios team, which is headed up by a former Marvel
Speaker 3: Studios producer, that exists specifically to help creators make the
Speaker 3: things that they want to make. So, like for Identities,
Speaker 3: the Nebula original film that we're working on here in
Speaker 3: La this week, we have an entire production team working
Speaker 3: together to support Jesse in making this film that is
Speaker 3: very clearly a Nebula original, writing, production, support, with providing funding,
Speaker 3: and it'll live exclusively on Nebula for a creator who
Speaker 3: they made a video and they also made like a
Speaker 3: five minute companion piece that doesn't really fit on YouTube.
Speaker 3: So they're going to make it like a Nebula exclusive
Speaker 3: thing that's not really an original, not in not in
Speaker 3: the way that you'd think prestige original. It's more of
Speaker 3: like bonus content, like a DVD extra, So we kind
Speaker 3: of break it down like that. If it's its own
Speaker 3: thing and stands alone and you could imagine, you know,
Speaker 3: sitting down and hitting play on just that and we
Speaker 3: help to make it, then that's an original. If there's prestige,
Speaker 3: that's an original. But if it's like a thing that
Speaker 3: kind of needs the rest of the system to make
Speaker 3: any sense, that's more of a plus kind of thing.
Speaker 3: But the other part of your question, like who owns it,
Speaker 3: Every single thing that the creators make that go on Nebula,
Speaker 3: including every single one of our originals, are owned by
Speaker 3: the creators. We do not own the intellectual property. If
Speaker 3: it's a Nebula original, we get an exclusive an exclusive
Speaker 3: streaming license, but we don't own the IP. So if
Speaker 3: in the case of the short film that we're working
Speaker 3: on now, Identities, it could be treated as a pilot
Speaker 3: episode of a show, and Jesse could take that pilot
Speaker 3: to Netflix, to HBO, to whomever and sell the show.
Speaker 3: They would have to buy their rights to the pilot
Speaker 3: from us, the streaming rights to the pilot from us,
Speaker 3: but Jesse could sell the entire show. We don't get
Speaker 3: a penny. You can develop merchandising around it. We don't
Speaker 3: get a penny. Ask George Lucas how valuable that can be.
Speaker 1: So does that pose, you know, concerns to Nebula as
Speaker 1: a company that you don't own the IP and could
Speaker 1: a creator take their content off Nebula anytime they wanted to.
Speaker 3: Concerns? No, No, I think that trust has to be
Speaker 3: at the core of what we do. Like I don't
Speaker 3: want to be in business with anybody who doesn't want
Speaker 3: to be in business with me. I don't want people
Speaker 3: locked into a relationship for a creator. They either they
Speaker 3: believe in what we're doing and we're all on the
Speaker 3: same team, or they don't. And it's helpful to note
Speaker 3: that Nebula fifty perc of Nebula is owned by the creators.
Speaker 3: If we were to ever sell it, we have to
Speaker 3: contractually give fifty percent of that money to the creators.
Speaker 3: Whenever there's there's profit, we have to give fifty percent
Speaker 3: of that profit to the creators. This is a partnership.
Speaker 3: So when we bring a new creator in, we're not
Speaker 3: signing talent. We're bringing in a new business. It's part
Speaker 3: of the reason why we're so slow and methodical and
Speaker 3: how we grow our roster, like we're we're not signing
Speaker 3: random deals to get content. We are. You know, these
Speaker 3: are new roommates we're interviewing. These are longer term relationships.
Speaker 3: So because of that, because of the nature of the relationships,
Speaker 3: we don't see a lot of people leave. There's not
Speaker 3: a ton of hard requirements for things people are have
Speaker 3: to do. So for the folks who maybe don't have
Speaker 3: the bandwidth or aren't seeing returns, then you know, they
Speaker 3: can kind of just coast on it and keep uploading
Speaker 3: to both places and still get some level of reward. Also,
Speaker 3: we're the largest sponsor for all of our creators. We
Speaker 3: literally every month, our largest line item is we pay
Speaker 3: all of our creators to go tell our audience that
Speaker 3: they're on Nebula. So there's not a ton of incentive
Speaker 3: for anyone to walk away from that relationship. So we're
Speaker 3: not really worried about it. I think we have to
Speaker 3: lock people into anything. If the deal is good enough,
Speaker 3: if the relationship is good enough, they'll stay. And hanging
Speaker 3: on to intellectual property licenses doesn't get us out of that,
Speaker 3: it doesn't solve any problems. In fact, by not doing that,
Speaker 3: it helps us at a tempo of like we're in
Speaker 3: this together. We're helping you build things. Our mission is
Speaker 3: not to own all of the things in the world.
Speaker 3: Our mission is to help an extremely talented and ambitious
Speaker 3: group of young creators. I say young not because they're twelve,
Speaker 3: but because the industry is young, help them make the
Speaker 3: things that they want to make because we know they can.
Speaker 3: And if we're a hit maker, and if we are,
Speaker 3: if we build our reputation on trust and our ability
Speaker 3: to help achieve those goals, then that's where we're going
Speaker 3: to win. Not because we have an infinitely deep content
Speaker 3: catalog of things we own. We don't need to own everything.
Speaker 3: It's better if we don't.
Speaker 2: Thank you for joining me today, Bab.
Speaker 1: In closing, is there anything else you want our audience
Speaker 1: to know about Nebula?
Speaker 3: There's this uphill battle we've been fighting for years to
Speaker 3: get any kind of recognition outside of our bubble. And
Speaker 3: we talked to going back to the thing with Sam
Speaker 3: and doing Netflix stuff, or you developing shows for other
Speaker 3: platforms and all of that. We've had similar conversations. We've
Speaker 3: been approached by major Hollywood development companies like yeah, we
Speaker 3: want to put your show, your creators on Netflix. We
Speaker 3: do these things and we go through the exercise like Okay,
Speaker 3: well how long would development take? What does the money
Speaker 3: look like? And it ends up being like, okay, so
Speaker 3: you want us to You want this creator to commit
Speaker 3: two years of their life to developing a thing that
Speaker 3: they sell for fifty thousand dollars and they maybe get
Speaker 3: a roll on for another maybe one hundred two hundred k,
Speaker 3: setting aside everything else they could be working on. You
Speaker 3: want them to spend two years on this for a
Speaker 3: show that you're going to cancel after one season because
Speaker 3: it's Netflix two hundred and fifty k, right, Or we
Speaker 3: could just stay on YouTube, reach hundreds of millions of
Speaker 3: people and make millions of dollars a year. Why the
Speaker 3: hell are we even talking to you? It just doesn't
Speaker 3: make any sense. Hollywood treats us as a farm league.
Speaker 3: They treat us like cheap talent. My number one goal
Speaker 3: in starting doing like real pr work and getting our
Speaker 3: name out there in a different way was getting coverage
Speaker 3: and Variety.
Speaker 1: Thank you for joining us for this week's episode of
Speaker 1: Variety Strictly Business podcast. You can find new episodes weekly
Speaker 1: on Apple Podcasts.