– How does LMG make money extremely. Lttstore.com. It doesn’t take a deepthinker to figure out that we expend a good deal of money around here, on faculty, our equipment, filmingsets, production paraphernalium, computers, et cetera, et cetera, et cetera. What’s tougher is where it all comes from. I’ve seen speculation thatwere involved in everything from IT consulting tocommercial movie production to back alley deals with industry heavyweights to suppress their race. All of which is prettyfunny to me because I know that at least 2 million of you already got the answer to this question. We merely do YouTube videos or at least back then we did. In fairness to you guys, the last four years hasseen a lot of change in the influencer manufacture as a whole. And our companionship has converted. We’ve practically tripled insize by our headcount. So I predict I felt like inthe interest of maintaining the kind of transparencywith our community that y’all expect from us, it was time for an update. And this video is sponsored by Shopify. A heap of what I’m aboutto tell you is going to be the same as last-place time.Starting with how we preserve coin from polluting our editorial material. So we still maintain strict guidelines for our sponsors’ demeanor, even proceeding as far as to issue ultimatums for inadequate businesspractices, like for example, making it difficult tocancel recurring fees or even cutting them off outrightfor inadequate customer service. And every brand from small indie stores who couldn’t offer usmoney if they wanted to all the way up to largemultinationals with quarterly or even annual spendingcommitments with us gets the same treatment when itcomes to product assesses. You cannot buy a positivereview at Linus Tech Tips. And in fact, you can’tbuy a review at all. Our editorial calendar is not for sale. Even if you sponsor a produce showcase or some other similardemonstration of your make, which by the way is never the same as a review on ourchannel or anyone else’s, in accordance with FTC guidelines, we won’t return any opinionwe can’t stand behind.And we would rather scrap the video and leave the money on thetable rather than compromise the trust of our audience. We’ve done it. Why you might ask? Well, chiefly becausewe’re just nice parties. And we care about both the employ that we do and how it affects you. But even though they are you don’t believethat and you’d rather believe that we’re an evil corporation that’s only out to make money, I’ve got that crossed too. Our most stalwart fans, the ones that buy melt from lttstore.com, carry us on Floatplanewhere we upload early access and exclusive videos and buy produces exerting thepaid ties-in under our videos directly contribute a massive 32% of our annual income as a company.And the most mind bendingthing about that figure is that my most generous estimate frames that group of beings at roughly 100,000, less than 1% of our subscribedviewers on the main canal. That stirs you, the 1 %, a more powerful block than any corporate overlordor patron was possible to be, which is both really cooland likewise a little humbling. So if you’re taking a sip ofwater from our water bottle or watching this on Floatplane, then from the bottom of myheart and everyone here, thank you. You guys make a waybigger difference to us than you probably realize. Out of that 32%, the smaller portion ofaffiliate revenue here is mostly Newegg, and Walmart, with Amazon Associates inducing up the rest.Now Amazon is still apretty big chunk of change. But since 2016, it’s fallen from 16% of ouroverall income to time 9 %. And candidly speaking a bigpart of the reason for this is that we’re actually afraid of calling out the links in our videos for fear that we’re going to get kickedout of the program again for like, doing it wrong, even though it’s the way that other parties make love. So we just chuck the links down there in the video description and hope that peoplefind them on their own. I signify, how crazy is that? An affiliate curriculum withrules that are so opaque and enforcement that’s so random that participants areafraid to promote it. Floatplane is also significantlydown compared to Vessel, the Early Access startup company that we used to publishour videos earlier today. But that’s lower levels of a frightening badthing than you might think. Unlike Vessel which asfar as we could tell, was basically precisely flushingventure capitalist money into the pockets of online inventors. Floatplane is a sustainablealternative revenue source for us. It’s also a biggerchunk than it looks like because it’s almost all content that we would have created anyway.So there’s next to no extraexpense to produce it. And unlike physical goods, you don’t need to buy it ahead of time and furnish it in a warehousebefore you can profit off of it. Raising us perfectly toour biggest gainer overall. Merch has grown a big five times from 3% the whole way to 15%. So if you felt yourself wondering, “Ooh why is he always like lttstore.com? ” Well, there’s your answer. The big difference makerhere was abandoning the turnkey solutions that wetried before, like Teespring, in favor of an approach that allows us to maintain strict controlover both our storefront through Shopify.Did I mentioned they’rethe patron this video? Thanks, bros. And product quality. So now we source our own blank shirts. We design our own artwork. And we work with a localprinter here in Vancouver to spawn our own t-shirts, while also maintainingour own their interaction with overseas plants forother makes like underwear, water bottles, cable ties, et cetera. Shopify also has lots of tools that have helped us originate this segment. Like deep integrationwith third party add-ons, analytics that help us understand where our traffic is coming from and how well we’re converting. And much, much more. Of route, we’ve seengrowth in other areas too. In 2016, we were doing about 400 million viewsa year company wide. This time, we’re trackingover a billion views on the Linus Tech Tips direct alone.And at that kind of scale evena fraction of a cent per judgment contributes up to some pretty crazy numbers, more than I expected, actually. I want, undoubtedly, as CEO of the company, I look at our books from time to time, but this kind of analytical reporting needs to be generated manually. So I’ve been going on gutfeeling all this time thinking that we’ve become less dependent on Google compared to four years ago, when actually it’s more. Now YouTube takes a lot of flack.And often rightfully sofor their management of the scaffold and its creators. But let’s give the team some approval here. Between tools that contributedirectly to our bottom line, like memberships and super chats and more incidental oneslike YouTube Premium, which for those wonderingcontributes acces more to the channels that you watch than ads, our RPM or income per thousand panoramas has been an increase a shocking4 4% even though CPMs, or how much an advertiserpaid per thousand goals has already been fallen bynearly 20% in that time. Another action we’ve grownis through direct sales. At 42% of our total revenue in2 020 compared to 51% in 2016, they’ve technicallydropped down a gala bit.But in fairness, those guyshave a lot on their illustration. And one of the waysthat they’ve stepped up is by hugely diversifyingthe types of sponsors that we are addressing. We’ve gone from PC hardware dealers. So these are labels whose makes we could conceivablyalso cross editorially, reaching up 85% of our patron dollars to merely 26% so far this year. This has been one of my goals for as long as we’ve existed as a company because not only does itdiversify our revenue streams, which is like business 101, it also increases the potentialfor conflicts in the best interests. The channel that we sit right now, our independence as a mediaoutlet can never be compromised by say, you are familiar with, some whalecorporate patronize who might try to pressure us intoproviding positive coverage by threatening to withholdfunding that we need to survive. It cannot happen. Breaking these quantities down a bit. We clearly do a great deal lesslive phenomenon coverage now. Thanks COVID. And amply patronized videoshave actually plunged off as a share of total revenue.But we’ve pretty much made up for it with those regular mentionsthat you guys attend at the beginning and end of LTT videos. And with mentions on channels that simply didn’t exist before, like TechLinked, our thriceweekly tech report roundup and Short Circuit ourback to essentials unboxing and first impressions direct that facets many differenthosts from the team here. So let’s throw up a summary map here. Yep, all right. So there it is. Other is some refunds and crap. And then our Minecraftserver is also in there for a whopping zero percentage. Although I’m actually expectingthat to be an area of growth as Jake and the teamroll out brand-new boasts. By the action, you can check thatout at the link down below. And then I imagine everything else on here I have addressed once. So that’s the big picture. That’s how the sausage is realized. Leaving only one thing thenthe claim of this video.Some of you are probably going to be a little annoyed to hear this, but I’m not going to address it immediately. But hold on, hold on. I actually have a fewgood reasons for that. One, while I could tell you the salary that I take home toactually live on day to era that would be prettymeaningless, given that the company is owned entirelyby me and my immediate household. So that would just thatwould be not lying, but definitely misrepresenting. Reason number two, I couldinstead cite my annual increase in net worth, except that the problem is it would be really easy forpeople to misread that.Like Let’s say for example, the best interests of the the Linus Tech Tips YouTubechannel goes up time over year by some big-hearted count, let’ssay, a million dollars compared to last year. That builds it sound likeI made a million dollars. But it’s also a number that I’m completelypulling out of thin breeze unless I have an actualbuyer for the path, which I don’t. And to realize that gain, I would actually have to sell the channel, which I have no intention of doing, impelling the entirediscussion strictly academic. Eventually, intellect digit three, it’s none of your beeswax. The good story is that I’ve given you an absolute capital ofdata now, pun intended. Including some figures that can fairly easily betracked back to known significances. So if you care that much and you’ve got the requisitebackground knowledge, you could at least try tomake an educated guess at it. I’m not going to confirm ordeny any such theorycrafting.See rationalization crowd three. But what I will say is that I’ve seen at least one past endeavor that was pretty close and too a lot that werecompletely out to lunch. Speaking of lunch, youshould bundle your beverage in an insulated water bottle from lttstore.com powered by Shopify. Big shout out to ourCanadian bros over there for sponsoring this video. Not that there was noulterior motive behind it. Shopify loves drawingattention to online businesses both small-minded and large-scale that use their platform togrow their business online. And that 500% growthin the last few years, actually almost all ofwhich was in the last two. We are surely one of those. If you want to create an onlinestorefront that looks great and has tons of peculiarities, Shopify has got you covered. Check them out at the linkin the video description. And if you want to see anexample of a great Shopify store that you might also experience youknow buying some concoctions from simply trip lttstore.com, There’s like so manylayers of sponsor area in this video.And that is how LMG becomes coin ..
