How do we have so much stuff? How much
is this even worth? And all of this is cheap compared to employing everyone.
Sir, don't call me sir. Sir, I know I've
been here a short time, but how do we pay for all of this? Obviously, this
helps, but there's got to be more. Is there something you're hiding?
Nope. But it has been a while since we've done one of these and a lot has
changed in that time. There's been good times, some of them very good and bad
times. Some of them very bad. And through all of that, we have more than
doubled the size of our team. How do we make money now then? Like this. That
right there is 2024's finalized revenue split. So, uh, video done
then. Oh, right. You guys probably want
a bit more context. But here's the thing. As we've grown, I have stepped
back from some of the day-to-day leadership. So, I might need some help
getting you guys the full story. That's why I was tasked to go to the accounting
department as well as talk to the other executives to find out all the juicy
little details for you guys and have them present it to
you. Our first stop is Colton. I
wouldn't go over there. At least not until you've told these fine folks about
our sponsor for this video, Odo. While we don't use them daily here at LMG,
they would love for us to show you some examples of how ODU helps manage your
business using their apps that integrate into one cohesive platform for easy
management. Start your 15-day free trial by visiting the link down
below. We're actually going to start with the biggest change on our chart,
ltstore.com. When Lin discovered LTT Store in the 2020 breakdown, it was 15%
of our total. Now, we've shipped over a million orders and it's ballooned to a
staggering 55%. The biggest reason for this is that
back then, two of our biggest product families didn't exist yet. Hand tools
and bags, which now make up about half the revenue with the rest coming from
everything else. That includes apparel, cable management, thermal pads, pet
accessories, baby stuff. It's a pretty broad mix. Yeah, the ltstore.com call
outs can be a little cringey, but they get people's attention. And when you
combine that with quality products, it clearly works. So much so that we
recently flipped the script and went from sponsor to sponsorer, choosing some
of our favorite creators to show off all of our products. The team has been
killing it. Black Friday grew 45% year-over-year. But in my opinion, the
best part of that event was that the orders were also fulfilled 60% faster
than they were in 2023. I'm sure you appreciated that. It doesn't mean we
never have problems, though. Near the end of 2023, we found out live on the
WAN Show that a manufacturer screw up on our OG backpack meant it didn't have the
dual layer bottom that we promised. But our motto has always been to make it
right with our customers. So, we retroactively modified our warranty to
provide extra coverage on that bottom layer. And our amazing in-house support
team offered gift cards as an apology. And if that wasn't enough, we offered
outright refunds to anyone who wanted one, even those folks who had been using
the bag for over a year. Now, if you want to provide great support, Odo has
you covered. Their e-commerce app allows you to build a digital store to market
and sell your goods. And they offer time tracking, priority assignment, and even
documentation about how certain tickets should be resolved, so onboarding new
employees is easy. I could go on all day, but that's enough about LTTO for
today. So, let's throw this sleek and
stylish commuter backpack, ltstore.com,
to the writing department to talk about AdSense. Oh my goodness. Thanks. From
2016 to 2020, AdSense actually grew from 18% to 26% of LMG's overall revenue. And
I'm happy to report that in 2024, it went down.
Not going to lie, I was actually super confused when they told me this was a
good thing. We literally call ourselves YouTubers. How can it be good to make
less money from YouTube? Well, for starters, just because it's a smaller
percentage does not mean that it's less money. And second, it means that LMG is
far less reliant on our Google overlords than we used to be. Let's say YouTube's
ad business just collapsed. For most channels, that would probably mean game
over. But thanks to our diversified revenue streams, we can actually carry
on through challenging times. Of course, we don't mind it ain't money. So, let's
break it down here. 61.5% comes from ads. So, if you're someone who sits
through the ads before watching the video, we thank you for your service. As
for the folks who can't stand ads and opt for YouTube Premium, you guys make
up 37.3%. Hold on a minute. How can 29%
of our views make up 37% of our YouTube
money? It's funny because I've had a lot of people ask me over the years, oh
Lionus, I've got premium, so I'm watching without ads, does that harm
creators? But no, it's the complete opposite. The way that premium works is
it takes 45% of your subscription fee. That goes to YouTube to, you know,
maintain the platform and pay for YouTube music. And the rest, so 55% gets
divided up according to your total watch time over the course of the month across
all the channels that you watched. So if you watched 50% LT and 50% other
channels, you would actually be contributing many times more than an
adup supported viewer. Now shorts are a little bit different because Google
allocates part of their revenue to music licensing for shorts. The creator share
both for ads and for premium is just 45%. Frankly though, I don't really
blame them. Shorts get lots of views and therefore are a significant burden on
the platform's infrastructure. But it's clear that Google has a lot of work to
do figuring out how to monetize those views. Our biggest short in 2024 got 13
million views and made $1,300. That's about 100th of a cent per
view for me. And once everything is accounted for, probably even less for
Google. For comparison, our biggest VOD last year did over 20 times that amount,
over 2/10en of a cent per view. Then
there's longer live stream archives, and the numbers completely change. Again,
here we're looking at about 1.8 cents per view. Now, again, this is just
looking at our top performing in each category for the year, but it gives you
an idea of how watch time contributes to revenue, especially for premium viewers.
Not every channel performs the same though. Out of our active channels, the
main LTT channel brings in about 76% of
our AdSense with ShortCircuit and TechLink finishing off the podium. Now,
I want to clear something up that I'm sure will be a point of discussion in
the comments. LMG's numbers are not and
will never be directly comparable to other creators. If you're a Moist
Critical fan, you probably saw his video which broke down YouTube revenue versus
Twitch revenue and saw that he pulled in a whopping
$84,000 for a 4-hour stream. But if you
look closely, that's because he was making over 17 RPM or $17 per 1,000
views. If you took that number and multiplied it by our roughly 850 million
views last year, holy we should ask for raises. I keyed because we don't
make nearly the same RPM on our channel and he might not either. Even on the
same channel, RPM can change dramatically depending on how desirable
your content is to high roller advertisers. On our channel, we've seen
as high as $11, but as low as $3.
Though, of course, that's before we bake in our own sponsors. Speaking of
sponsors, this seems like a good time to segue to our Colton. That's right. I
still work here. And if you watch regularly, you'll know we have a wide
variety of partners that we deal with. How wide? We managed to break it down
into about 13 different categories, ranging from PC parts to gaming to
lifestyle, and even software as a service, like our sponsor for this
video, ODU. One of their apps is completely dedicated to sales. It helps
you keep track of clients, track income, and organize your data into almost any
type of chart you would need, like this one. This is a breakdown of our 13
categories. SAS companies like ODU make up 25.5%.
Lifestyle is 13.6% and PC parts is
34.6%. PC parts are actually up from 2020, which is both good and bad. It's
good because it clearly shows that you guys are closely engaged with the brands
you see featured on our channel, allowing them to outbid our other partners. But it's bad because Business
101 says to diversify your income and not put all of your eggs in one basket.
And tech has a risk of becoming a heavy basket for us since our audience
demographics are so obviously appealing to tech companies. With that said, while
three of our top tech partners do make up about 15% of our sponsor revenue,
none of them are over 5%, meaning that none of them can have a major impact on
our business. Another way we avoid overreiance on individual partners is to
have a wide variety of partners within our categories. In the PC parts
category, we work with 26 partners and across all categories, we have over 150.
To add some additional context, our sponsors made up 21% of our 2024 revenue
with invido reads accounting for 9% and dedicated sponsor videos accounting for
12%. We also provide production value to companies like Dbrand and MSI. We just
released a video where Plof and Sherrod take you through how it's done and give
a little bit more insight into how LMG works down in the gears and the guts.
Head over to LMG.gg/flowplane to check it out.
Sponsored videos come about in one of two ways. The ideal way is when we
integrate a sponsor's product into an already existing idea. For example, we
had the idea for me to make an outdoor pool gaming setup. So, when someone
reached out looking for a cool project to show off their projector, that was a
perfect fit. The same goes for the time we wanted to make a video on cleaning
out a water cooling loop and an ultrasonic toothbrush brand stepped up.
Naturally integrated and more importantly, highly relevant to the
project. The second way these videos come about is a sponsor will bring us a
product. let's say a robot lawn mower or pool cleaner and then we will go out in
search of a lawn or a pool to maintain.
These videos tend to rely more on unscripted shenanigans and the
personalities of our hosts to drive viewer enjoyment while we tick off all
of the key points the sponsor wants communicated about their product. Now,
these videos are always clearly disclosed both verbally and visually.
And while they do often include candid footage of us using the product and even
providing commentary on it, a sponsor can buy airtime on our channel, but they
can never buy our opinion. FTC guidelines clearly state that if you say
it, you have to believe it. And no vendor talking point should ever be
disguised as an opinion unless you happen to agree, let's say, for
instance, that the design of this product is minimalistic or what have
you. We also go out of our way to validate manufacturer claims when
possible, even in sponsored videos. One area that this has been really useful is
when evaluating displays for phones, which sometimes do not reach the
brightness levels that are specified by the manufacturer. This kind of scrutiny
is just part of the process of working with us. And if a sponsor doesn't like
it, we'll just drop them like we've dropped so many others in the past.
Sometimes we also drop sponsors because of you guys. We maintain an open line of
communication for sponsor issues or concerns through our community forum and
we have a long track record of leveraging user reported issues to
affect change at the companies we partner with. Speaking of forums, ODU
also has a dedicated forum app in case you want to add it to your website so
people can complain if you're discounted affiliate links aren't working. Speaking
of affiliate links made up about 3% of our 2024 revenue. Those are the links
that you'll often see in the description, like our referral code for private internet access. Those can be a
pretty good deal for all sides. PIA gets a new subscriber, you get a discount,
and we get a kickback. All in, the business team lands at about 24% of the
total pie. Now, you can see why we keep bringing Colton back into the fold. Now,
we're almost done, but first, let's take a quick ride on a flopplane.
Flipplane.com is our paid membership website where we offer exclusive content
and sometimes early access to our videos. We offer two subscription tiers,
$5 or $10, with the difference being that the higher tier gives you 4K video
and sometimes access to extra exclusive
content like the digital pass to our last LTX expo. In 2024, Flowplane was 7%
of our pie. It's a humble slice, but it's also up 1%. And I think it's pretty
cool that with Invido sponsor spots coming down and Floatplane going up, we
are contributing almost as much as every Invido sponsor combined. Lionus often
talks about how the audience is the real boss of the company. And this is a prime
example of how easy it is for you guys to show us when you support our
direction and to show us when you don't.
Elephant in the room. We lost a ton of Flowplane subscribers after the great
reset in August of 2023, but thanks to
the hard work of our team. Shout out to Sammy for the great exclusives, we had
three major pushes to help bring us back to just about where we left off. Thanks
again for supporting us at Flowplane. Now, let's get back to Lionus for some
closing thoughts. There you go. The last under 1% is miscellaneous things like
random reimbursements, which I think underscores the point that Luke mentioned about you guys being the boss.
When you break it down, every single piece of the chart still boils down to
you. You are the boss when it comes to choosing to engage with our content
ideas on YouTube. You are the boss when it comes to what sponsors we work with.
You're the boss when you evaluate the quality of our products. And you're the
boss when you choose to directly support us on Flow Plane. And just like any
boss, if we're not living up to your expectations, you have the power to give
us a good old-fashioned dressing down, to dock our pay, or even sack us
outright, which it's kind of a scary way
to live, if I can be real for a minute. But it's also super cool because not
only do we have this massive community to share our passions with, but a
massive community that can help guide us toward what you guys want to see in the
future. As for our second larger elephant in the room, you'll notice that
we never gave you guys any specific dollar amounts. I am sorry about that
and I understand that in trying to be as transparent as possible with you guys
over the years, we have created an environment where the one thing we can't
talk about can trigger a vigorous pitchforking. But the reality of it is,
whether it's channels pausing production or employees leaving the company or the
exact dollar amounts that we made on a specific deal, there really are some
things we just can't talk about. Both for our protection and for our team. Say
you were canned, for instance. Would you want your former boss or colleagues
talking about it on a podcast? Of course not. And for fairness sake, we have the
same processes so that everyone is treated the same. As for the final
chart, you can see there is even more detail under each slice that we didn't
really get into and it can get pretty complicated. This is a big part of the
reason that I hired a CEO back in early 2023 and have asked the rest of the
leadership team to step up. My strength is being a bottomless pit of creativity
and I found that while I could spend my time on the details, it wasn't
necessarily the best thing for the company and the team. What the team does
like though is getting paid. Thanks to our sponsor, ODO. They have an
accounting app that helps you manage your business or website. So whether
it's managing customer invoices, your POSOS system, your employee salaries, or
other miscellaneous operations, ODU can track, receive, or pay out bills as
needed. They have a wide variety of apps, and you only need to select the
apps that you need, and you can even start by using one full app completely
for free. So head down to the link in the description to start your 15-day
trial today. Thanks for watching, guys. I don't actually sit in annual business
reviews anymore. So, when I reviewed the script with Elijah, that was
legitimately my first look at these numbers for 2024. Hopefully, it was as
fun for you guys to go through as it was for me. If you want to see in more
detail what's changed over the years, go check out the two previous editions
we've done of this back in 2016 and in 2020.