Is youtube worth it for profit? (This is a long post)

For the past 5 months I've been waking up in the morning being refreshed with a new wave of ideas for a youtube show. The more I write the more ideas I get. I've been waking up in the middle of the night or getting coffee, dazing out, then running to my computer to write a digital sticky so I don't forget. My idea offers all of the ingredients of success. I believe that in a year from production the name of the show will be a trend as known as "selfies" and "Fail!". The concept and script of this show could pull 6 seasons on A&E for sure.

Where things get really serious:
1. I have over 30 episodes scripted and detailed from every prop to the items in the background. I have completed an identical copy with scene art in the form of comic books in order to capture poses, movement, and facial expressions. I've also written just a ton of the business side of it as well as expenses.
The expenses are very high. The initial expense is like 25% of the total cost of the show.
My show requires a hell of a lot of staff for such a risky move.
-3 non-professional peaple eager to be in front of a camera to perform to get popular/money. Also, a person to assist me with the mass amount of duties like prop setup, sound mixing, director duties, etc. Lastly I need to hire a person to handle the online aspect completely. Being the webmaster, photographer, video editor, etc.
-I don't have a calculation. Some of the shows have no real extra expenses , but there are others that go an upwards of $2K until wrap. This would be props, stage, rental(if needed), misc.
-The equipment that needs to be purchase. Oh, two video cameras, high-Q digital camera, sound equipment, most episodes need multiple costumes. I estimated $7K but it's hard to know how resourceful I will be.

MONEY RISK
So basically this is a $50,000 business model which will require me to be ready to dish out $15,000 for the 1st five episodes. Casting & training will take minimum of 8weeks, 5 shows at will take 2 months. After the upload of show 5, if there is no feedback from the public(profit) then I have the cancel the whole deal.

Reputation & quality of life risk
The shows genre can be formatted to be a true documentary, but can also be setup as a mockumentary reality show. I've decided to script it as a mockumentary but release it as a documentary(haha, that make sense?). The script is far superior. The problem is if it is shown as a doc. than my reputation is FINISHED in this city. It's pretty colorful......well it's like no one has ever seen before. My family/friend relationships will be on trial too. So doing this project will affect my life negatively win or lose.

Anyway, you can tell I'm really edgy on putting my life on the line and depending on youtube. This will spread through trends on facebook and what not but without youtube it will never reach it's bottom profit need of $100K and bring some future in the project. youtube is suppose to average .004 per hit on non-partners.

I could go on forever, anyway.
Now the simple question. Do you think it is a good idea to build a business model that is so expensive that relies on youtube?

 

I only reupload creative common license videos and I earn some bucks every month.

 

What you are describing is a big risk, both financially and personally, for yourself. Before I jumped into such a proposition, I would want to be as sure as possible that the concept/business model has legs. Obviously, you are passionate about the concept; but will anyone else really care? Have you run the concept by friends, family, and others? You really need to engage with as many different people as possible on this topic. I know that you may be trying to keep the concept a bit of a secret but with such high upfront costs as a barrier to entry, I don't think that you need to worry about people stealing your idea. Bottomline: make sure that this is a good idea for a business to many other people besides yourself before you take the risk.

 

That's good to know. And I also agree with @jrbiz. Every business opportunity is a personal and financial risk. You have no idea what the outcome will be but you spend time and money on it.

 

2 months ago I ran 3 tests.
I did it on the streets with three friends. Basically we just walked downtown, stopped and talked and staged scenes in the show. We were just trying to see reactions and what people think about us. People would stop in their paths, try to listen in, some would even just stop with a smile on their face waiting for us to stop talking to each other then approach one of us to talk. People were very entertained by it. A lot of people did approach and say "nah, this was a total act. No way this is real" others were saying that they don't want to be nosy with our lives but are curious to know more (Like it was real).
I was very surprised. At one point we were inside a donut shop and made sure to sit near a big bench seat full of loud teens. We did our thing and started doing a scene(just talking freely to each other while eating). It was not long before they were quietly saying "I should be writing this down for a book". They are just dying to talk to us but didn't.
the second test was easy. The one friend of mine just happens to be very attractive so I got her to do a sit down at a park and pretend like she's just a talky unintelligent blonde person and start jabbering about her life to the first person who has a good pulse. The people responded by asking question after question.
Third was just us using random one-liners and little simple trends in the show to see if people listening in will raise and eyebrow, crack a grin, or maybe walk past then turn to take a second look.
It all just went really well.

Just the three friends. I didn't share tons of details but I gave them the jist of it. I showed them 3 full scripts just to read on the spot with the visual concepts. They all pretty much said that if it gets seen people are going to plug it all over the internet so quick.
They all said that I should just make the whole thing then try to sell it to like "MTV". They said that those guys who created teen mom, trailerpark boys, storage wars, or shows like that would be able to air it fine. No one actually believes in the stuff.

There is plenty of room for me to talk freely. I think I did mention before that there are lots of small never been done before trendy hooks though. They are perfect for the show because it gives people a trend to try to be a part of themselves. I'll have to keep them to myself completely. That would be annoying to be the guy who came up with the idea for like hashtags(example) then before he puts it into motion all of the other sides use it.

I'm confident. I'm more concerned with the issue of being just shut down by youtube. With adsense you get banned and you sell ads independently or go to one of the hundreds of others sources. Get taken out by youtube and I'm finished. The profit from the other sources like the website, Merchandise, product placement, is a drop in the bucket without the promotion of youtube it's pointless.

I'm on the creation side, and you are on the get me free promotion and earn me great returns for free side

 

It sounds like you have done a little testing, but not nearly enough. That said, the early results are promising.

One way to reduce your overall risk is to get a financial backer in the form of a silent partner. That person is responsible for funding and you are responsible for the creative, production, etc. If your partner has marketing or operations or other helpful skills, perhaps you could both put in funding and both contribute time and effort in the project. You and your partner would share in the rewards, of course, and you and s/he would have to agree in advance (and in writing, of course) what the investment, responsibilities, and split of the rewards would be.

Another way to reduce risk would be to produce a pilot or two at low cost and take them to production companies for commercialization. Yes, you will get a smaller slice, but the pie has the potential to be much bigger.

It sounds like you have hit upon a good idea/concept and are truly bought into it. Passion is a big factor in the success of any venture. That makes me want to recommend that you go for it. My 25+ years of business experience, however, tells me to be wary and try to minimize risk exposure if you go forward.

 

What about the part of depending on youtube to not throw me to the curb? Are you Familuar with youtube and know of a way to make it more secure than their policy which is "oh, we don't really have to defend ourselves on why you were removed from our site. bye bye"

 

With the scarce information you give us about your project I doubt that anyone would like to assume if you will or will not go against Youtube policies. Even though you might not directly overstep them, there is always the issue of affected parties that may report you or take other measures (again, just guessing blindly in the dark). The easiest thing you can do is get acquainted with the YT policies for starters so you can be sure if your project does not fit into any of them:

http://www.youtube.com/yt/policyandsafety/policy.html

Hope this sheds a little light.

 

That is certainly one of the risks that you have to consider, but it is not the only risk. Another big risk is that your idea might not catch on as you think it will and revenue expectations are not met. Another risk is that a competitor might spring up five minutes after you launch and be better funded or have some other advantage in the marketplace. The list goes on and on...and many times an entrepreneur will be surprised by a risk that had not even been considered when the business was launched. That is why I am suggesting that you limit your personal risk exposure a bit in what sounds like could be a big hit but also is high risk.

By the way, one way to mitigate the Youtube risk factor would be to take Rado_ch's advice and become extremely familiar with their terms of service. That way, you can be more confident that you won't be removed.

 

I'm not feeling the heat of any of these problems if youtube does throw me to the curb. The other risk you mention is completely void with my business plan because of how this show is presented.
The whole purpose of the plot, script, performance of the character is to allow the charcaters' to shine for the viewers. Example: most people will not think "Wow, that is hilarious!", but they will think "Wow, that guy/girl is a natural comedy genius!"(Such as Al bundy & Homer Simspon). This way you establish fans in much higher numbers. PENDING your show is entertaining enough by itself to catch fans who just find it interesting and you have fans who just want to know/see more of the character. The subscriber adds & views will show a gradual UP. Now you continue on as planned and when the time comes where there the increase slows down to push in an episode that FINALLY shows that different side of the character that was in the shadow throughout previous episodes(fans are like "I knew it!"). Now they saw something different and they share and think/discuss it just like when it blew them away the first time.
Anyway, I could probably go on forever about this particular subject and to be honest, the only reason I'm saying so much is just to let it out a bit.

The policy I have printed and will fully follow it.

 

Hey Man,

I started a VIDEO channel on YouTube 2.5 years ago,

I have 700 videos online and I appear in all of them,

I now have 780,000+ views and 2500+ subscribers.

IT has been a game changer for good and bad,

- Joseph

 

Care to share a little bit of insight on the specific challenges that you have been faced with?

Also if you use add in music/sound clips? Is it your own? What is the process for getting rights to add it without losing profit?

 

Joseph, are you making any profit from your youtube channel ?

 

OP - 50k for 15k investment with such high chances of risk is most likely not worth it. There is an old saying - "Never bet the farm"

 

I know many of people making a lot of cash from it so I would say yes

 

I remember an old story about teenage-girl with $15k monthly youtube income)
But seriously - it's very simple rule: good content = good earnings

 

I'll have to think about it. I did just start a business 4yrs ago then go OUT of business as well. It was like $32K. I ended up having around $10K and 3yrs salary but still. Waste of time.

 

Umm big channels like Freddie W or King Bachelors PAD TV have many expenses because they have scripted high quality content and they make way more than they put out, so it is possible.

 

What would you like to know?

I also produce everything myself, no others music etc etc

 

All of my questions are related to music and sound copyright. Since you don't work with that then I guess I don't have any.