YouTube & Substack Economics 101

Is the "Creator Economy" Just a Grand Illusion?

Over the past five months, I’ve started two fun creative endeavors: the Ms. Mystery and Friends YouTube channel and this Substack newsletter. Both have been thoroughly enjoyable passion projects—an opportunity to pursue storytelling in new formats outside my comfort zone and explore topics in media, history, and pop culture. In that time, many people have asked me a practical question: “Is there potential to make a living from this?” Can I give up my day job as a producer, director, and editor of traditional TV and digital content and “cash in” on my own ideas, à la MrBeast or teenagers playing video games online? The answer: probably not… the odds are tough, and they’re stacked against anyone who isn’t already famous—which, last time I checked, I’m not.

People are mostly surprised by this bleak outlook for success as an independent content creator. And honestly, I was too at first—just how difficult it is to make any money this way. The reason? The large tech companies that run the world—and social media influencers themselves—have been pushing a new version of the American Dream, branded as “the creator economy.”

The idea is that anyone can make a living creating content—writing, filming videos, hosting podcasts, publishing newsletters—and get paid directly by fans on Substack or through Patreon, or by getting a cut of ad dollars on platforms like YouTube and TikTok. That’s what a lot of people say, anyway. Just as important as creating content now, is building your own audience.

The problem is that this dream is wildly unrealistic for all but about 0.05% of independent content creators.

AND, beneath this issue lies a deeper, darker truth: the allure of this dream allows social media companies to profit from “free” videos only they monetize really. While doing this, they’ve also destabilized the entire entertainment industry by wildly devaluing content as a whole.

That’s a big statement, sure, but let’s back it up.

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First off, credit where credit’s due—Ted Gioia made me see this issue clearly in a recent post where he laid bare just how parasitic companies like Google (which owns YouTube), Meta, and TikTok really are. They don’t create anything themselves. Instead, they let us upload our content with dreams of it going viral and sell ads against it. The platforms promise dreamers a chance to build audiences, monetize work, and bypass gatekeepers. It sounds amazing—a world where filmmakers, writers, musicians, “influencers,” and artists are paid directly for their art. But the reality? Far less glamorous, and honestly a bit sad.

Gioia’s post highlights the absurdity with a specific example: a TikToker who attracted 713,000 followers and generated 11 million views for her videos—and was paid a whopping $1.85 for her efforts over 5 months. Not $185.

$1.85.

That’s right, less than two dollars for nearly half a year of work that engaged millions.

Let’s talk some more numbers: According to a 2021 study, only 0.2% of YouTube channels reach the 100,000-subscriber mark, and just 0.02% ever hit 1 million subscribers. Even getting “monetized” (capable of getting paid for views by YouTube) in the first place is tough; YouTube requires creators to have 1,000 subscribers and 4,000 public watch hours within a year to even qualify.

Take our own Ms. Mystery channel.

We’ve garnered over 70,000 subs (so we are good there) and close to one million views to date, but we’re still only 10% of the way to meeting YouTube’s requirements for monetization. This is because we’re not even close on the watch hours. Our videos are relatively short, I only have time to put one out every few weeks, and because of the super complicated way watch hours are calculated, we only average around 40 hours/video.

BUT, for the sake of argument, let’s say we were monetized. How much would we earn for the 50,000 views we average per video? Best I can determine it would be about $20 —barely enough to buy the kids lunch at McDonalds these days. So, yeah…

…we’re not there quite yet…

Substack and Patreon

So what about things like this newsletter on Substack? Where hypothetically people can become paid subscribers for $5/month and support you directly, by-passing the gatekeepers?

Yes, some writers have found a large paying audience on here and taken control of their content. For example, Political statistician Nate Silver.

However, he didn’t just show up on Substack one day and amass his following by commenting on other people’s posts (the advice many suggest to new writers). No, he built his brand over years as a journalist and statistician at FiveThirtyEight, which was backed by ESPN, before jumping to Substack with his audience. That’s why he has such a strong paid following now.

Another success story is Bob Dunning—a columnist for The Davis Enterprise for 55 years, until he was suddenly laid off. He started a Substack, and all his loyal readers followed. He provides unique, witty commentary on life and current events in Davis, CA in the Substack The Wary One. It’s great, but let’s be real—Bob already had a large, engaged audience from his five decades as a well-known columnist.

People pay around $5/month to subscribe to Nate Silver or Bob Dunning because they offer something niche and valuable, and they’re already established. That’s a crucial detail that gets swept under the rug in the dream of the creator economy.

Can I really expect anyone, let alone thousands of people who have never heard of me to pay $5/month for this newsletter? Absolutely not. I wouldn’t pay for it myself. For that price you could subscribe to The New Yorker, Wired, Popular Science, or whatever “real” magazine you may be interested in. You could also get the new Hallmark+ streaming channel for basically that price (and with Christmas Rom-Coms coming soon I can assure you my wife is voting for that over this!)

The truth is that only an extremely small percentage of creators can genuinely sustain themselves this way. For everyone else, the numbers are just not there.

This wouldn’t be particularly concerning if it were just about individual creators trying their luck in the social media/blog lottery. The bigger issue is how this deluge of unsolicited “free” content has reshaped the entire entertainment industry, which I wrote about in my original post here in the newsletter.

Somehow, a $100 million blockbuster movie and a viral zero-budget user-generated video are now on a level playing field for our attention—and often, it’s social media video that wins.

It’s simple economics. When there’s such an overwhelming surplus of anything, it loses value. Suddenly, content creation, which used to require technical skills and experience, is seen as easy—so why would anyone pay a premium for it? I’m starting to see posts on LinkedIn offering less for “content creators” than you get paid at In-N-Out Burger.

Just wait until next year, when Google will introduce generative AI tools on YouTube, allowing users to create shorts with nothing more than a simple text prompt. This means the current content flood could soon look like a mere trickle compared to what’s coming.

BUT all is not lost.

In the next post, we’ll look more closely at what specific kinds of content are most at risk in this “devaluation” trend, but also, more importantly, what types of content still should be extremely valuable even in a super noisy marketplace.

Until then….I will go back to working on the mock ups for the Ms. Mystery & Friends toy line - just in case Target calls and asks for one.

I’m pretty sure that’s how it works. Right?