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