Breeze Funding vs. Back Catalog Sale

Even with a YouTube channel generating $500k or even $1mm+ a year and you are looking to get funding there are still relatively few options available. Is it worth selling your back catalog or doing a royalty deal to get the upfront cash? Read below so see how the funding options differ.

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Breeze vs. Back Catalog Sale 

 

In the late 2000s , the birth of the creator economy began, with platforms like YouTube paying creators a share of ad revenue. This led to the evolution of the creator economy to what is now an ecosystem with small, medium and large businesses or creators earning thousands to millions of dollars annually. These creators are no different than businesses and often times need cash, capital or access to funds to capitalize on momentum / trends and grow, or even diversify their businesses. And while YouTube creators have been getting paid for over 10 years, there are still limited options for creators today to get access to such capital. However, over the past few years channels generating $500k or even $1mm+ have begun to see offers for back catalog sales, a practice that is relatively new for YouTube creators, but evolved from royalty deals in other creator like economies (i.e. music or film). And while it is still a limited option to select few creators, it is worth comparing how it stacks up for YouTube creators and what it is doing for the general ecosystem.

 

Back Catalog Sale


Back Catalog Sale is a time-based royalty deal where the funding party gains rights and all revenue associated with a creator’s back catalog of YouTube videos. This may include videos up to a set date, which could be today or in the future. Essentially with this option your channel is handing over the ownership, management and even ad buying flexibility of all or part of your previously posted videos for a set amount of time, usually 5 years.

 

What is interesting in this option is that the value of a back catalog is highly variable. If a channel has very few videos in their back catalog or a low revenue generated from these videos this option can be intriguing. For those that have built up a substantial video catalog, subscriber base and are even seeing growth in their subscribers, a considerable portion of the channel’s revenue is built up over the combined revenue of past videos, and can make this option much less appealing. When selling your back catalog you probably have little to no control or visibility to what happens with these videos, meaning that in exchange for rights to these videos you may be unaware of exactly how much you are giving up for the cash you get today. As well, if you look to sell your channel during that time frame, you likely will have to do some very complex negotiating or may not even be able to do so. Further to that, if you rely on your YouTube AdSense to pay for a portion of your monthly expenses, well you won’t be able to do that anymore and will have to likely start over for that period of time.

Breeze

Breeze is a new form of funding for YouTube creators based on terms that are designed to help creators keep all the upside from their channel, with simple and clear funding terms. This partnership is about giving you the upfront cash you need for a pre-determined fee and a set revenue share, the only thing neither of us will know is the time period, as YouTube revenue is variable month-to-month and we take on that risk with you. At the beginning and through-out the partnership, you know how much you are earning on your entire channel and how much is going to Breeze. As you invest in your channel and become more successful the upside goes all to you – not us.

 

To help explain how these two options differ we’ve put together two hypothetical scenarios:

 

Scenario 1:

·     Your channel is generating $60,000/month on new content revenue.

·     Your back catalog of videos is generating $274,000/month to start. There is a depreciation on revenue of 10% per month in Year 1 and 1% thereafter

·     Without new subscriber growth your average RPM is approximately $6.69

Over the next 60 months your channel will have earned approximately $6.4 million in revenue, solely on past videos. The back catalog owners will have continued to earn money while your earnings are dramatically reduced. The back catalog deal may have got you a bit more upfront, but there is no limit on what the company that licensed that back catalog makes, meaning you will be handing over your a huge portion of your earnings as well as the money advanced to you.

Scenario 2:

·     Your channel is generating $60,000/month on new content revenue

·     You are reliant on your back catalog revenue which is generating $274,000/month. There is a depreciation of 10% per month in the first year and 1% thereafter

·     As you are producing more videos your subscriber growth is up 40,000/month with a 50% view on old content. This leads to an average RPM of $7.36 (growing by 10% from 3-month average)

Assume the same as Scenario 1, but now because you are producing more videos your subscriber growth is 40,000/month and 50% of them view your old content. Your average RPM goes up by 10% to $7.36 as well over the 60 month time frame. This means the lost revenue from selling your back catalog has gone up. The investment you are making in your channel is disproportionately benefiting the new owners of the back catalog over yourself, the creator.

 

 

Why choose Breeze?

We don’t want you to only rely on the income of future projects. You’ve worked hard to create your videos and built up a profitable channel. Instead of handing over unknown amount of future revenue, we have set out terms from the start with letting you know the full cost of getting the cash from us today.

 

Paying back the cash advanced is set based a percentage of your monthly AdSense revenue. We understand that this varies so our algorithm has been built to go with the flow of your channel and not strip you of your earnings. Once the set amount has been paid been, we are done! If your videos start doubling their views (and earnings)- that’s awesome, the upside all goes to you.

 

Taylor Swift knew the value in her back catalog and felt so strongly that she decided to rerecord her masters. Re-filming and reposting your videos might not be achievable, and certainly isn’t allowed.

 

Get Started today and see where your channel can grow!

How To Get Funding

1. Connect Account

Link your Google account so we can analyze your data.

2. Receive Offer

Get a personalized funding offer within days.

3. Get Cash

Spend to grow or diversify your business.

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