God damn, we love good loaded articles here at NMR, and as far as controversy goes in the YouTube space, few things can raise hackles quite like talking multi-channel networks and their often predatory or downright flawed business practices. Between you and us, there’s more to dislike about MCNs than there is to like. Now we’re not going to mention names (we shouldn’t have to), but let’s consider this an open dialogue with those MCNs (and you will know who you are) that it is time to change your practices and evolve along with the rest of the space. For those of you who are currently stuck in these contracts, look for a loophole. There is always a loophole. If they didn’t pay you on time with the accordance of a contract, that can be grounds for nullification of said contract — perhaps consider lawyering up.
If you aren’t in the grasp of an MCN, but you’ve got a growing channel and have been mulling over their offers, here are some warning signs to help you avoid the pitfalls of others. Without further contention, let us present the seven indicators you’re on the verge of signing with a bad MCN.
Frankly, there are probably more. But if these seven don’t convince you, what will?
If you’re running a channel that has got some traction, pretty much all MCNs should want you (unless they run a niche market that you just don’t fit — but even then, most will try to find a way if they smell money). It’s in an MCN’s best interest to keep you all locked up for themselves, though, so avoid signing with MCNs that want to lock you into a contract for an excessive number of years. What’s excessive? That’s up for debate. But believe in your channel’s abilities. Think about the potential of your channel to explode huge — if it does, that MCN will have little they can contribute. Do you want them to be taking a huge percentage of your earnings for years longer than they deserve to? Sure it’s scary to think about an MCN pulling their offer from the table when you push for a renegotiation clause after two years in your initial contract, but if your channel is good in this day and age, they’ll play ball.
BEFORE you sign with an MCN, check out who else has signed — and not just the bigs. MCNs love to sign a bunch of talent because they know that only a few will pan out. But there are plenty of really good mid-level channels that could be god tier if they’d just get some love from their MCN. These are usually the most disenfranchised creators — and with good reason. Signing with an MCN who isn’t willing to take your calls is worse than being an independent. Look at the social media of these mid-level creators and believe us, you will find their grumblings. Take note.
Poaching has become an unfortunate part of this industry and it’s something to watch out for. Certain MCNs, if they don’t sign you, will recruit talent that is SUSPICIOUSLY LIKE YOU. If you have an original act, you will get imitated and MCNs who aren’t working with you will facilitate that … encourage it even. It’s one of the negative aspects of the business and not one you can necessarily control, but consider that going in to a potential contract signing. Are they feeding you suggestions to “improve” your channel’s marketability? Maybe if that’s the case (not always, mind you), you are being set up as the imitator instead of the innovator. Keep doing you — it’s what got their attention in the first place.
YouTube started as a lark, but now it is a business. Even if you’re not getting into YouTube to become a rich industry player, your competition is. MCNs know they look glamorous and they have star power in their stables — so if you’re a newcomer, you’re on the outside looking in. Don’t be fooled. They’d have nothing without their creators. You and creators like you give MCNs their power. Without creators what would an MCN be? Nothing. That’s why, as Epic Meal Time’s Morenstein Bros. pointed out in their recent NMR article, many MCNs are having to get into different aspects of the business — brand integration and royalty monitoring to make themselves appear valuable to their majors. But that’s hardly worth the huge percentages they command. MCNs could be greedy back when YouTube was in its infancy — now with major corporate backers, they should be relying less on taking a chunk of your income and relying more on setting up those brand deals to make their cut of the pie.
MCNs think they know more than you when it comes to your channel and your audience, so frequently they will ask for access to your channel BEFORE you even sign with them! They want to analyze you inside and out to determine how they can use you instead of doing the work to determine how they can best serve you. Unfortunately, they tend to yell “standard practice” in regards to analyzing your metrics before you sign. That shouldn’t be the case. It’s as prominent litigator J. Reuben Clark postulated: “If we have the truth, it cannot be harmed by investigation. If we have not the truth, it ought to be harmed.”
If your MCN offers you Gwyneth Paltrow’s head in a box as a signing bonus, run! Seriously though, bad MCNs will become dismissive and bury you as punishment if your channel doesn’t do what they want on their timeline. Think about mainstream Hollywood — if an actor has three bad movies in a row, basically they are done for. The same goes for your channel — don’t let your potential MCN off the hook when it comes to your growth. Make sure you are signing with an MCN that is willing to foster your growth and exercise patience with your channel. You need to figure out the nuances of what you bring to the YouTube space — that takes time. Do not sign with an MCN who demands results from the get-go.
As we mentioned earlier, YouTube is sort of a numbers game — most channels won’t achieve that five percent level that garners the attention of major advertisers. MCNs know this so they sign a lot of channels, knowing that most will fail. Basically they are looking for the whales that get trapped in the tuna nets. Don’t be tuna — if an MCN has actively signed several other creators, they won’t have the time and capability to deal with all of you in addition to their already thriving talent. Know this — and if you simply must sign with an MCN (for the time being, for starters nowadays, they are mostly a necessary evil), look for one that will be able to focus on you and your success.
There are good ones out there — and ones who are getting better. Good luck finding them.
Share this article because it might just save someone from making a mistake with a bad MCN. And if you have any horror stories of your own (or tips) share them in the comments below.