How Do Creators Generate Income From YouTube?

How Do Creators Generate Income From YouTube?

We all love watching our favourite creators on YouTube. But have you ever wondered how do they capitalise on the views and likes and number of subscribers? Let’s have a look at different streams from which a YouTuber can earn.

Who knows, you might even start your new YouTube channel after this!

Crux of the Matter

Type Of Audience
The audience of any creator can be bifurcated into 3 different categories:
1. Casual Viewers: They form majority of the total audience. They are aware about the creator but don’t follow them religiously.
2. Active Viewers (Fans): They form a good chunk which regularly follows and engages with the creator on different platforms.
3. SuperFans: They are very niche but highly monetizable as they are willing to go an extra mile to interact with the personality.

Earning Avenues
The avenues are divided into majorly 2 parts:
a. Business to Business – This is further divided into Adsense and Brand Deals
b. Business to Consumer: This is further divided into Merchandise and Paid Content

Ad Sense
By this medium, YouTube sells ads through creators’ video
For such slip in ads, YouTube pays creators close to 50% of revenue generated. YouTube also tends to surface creators video more often, leading to exponential rise in views.

AD SENSE US v/s India Pay Comparison: In US, for every 1000 views, a YouTuber on an average earns $5.3. The same figure for India stands at $0.25.

Brand Deal
Various business houses/brands collaborate with creators in order to promote their products or services. This medium is a source of generating a sustainable income for creators as they can indulge into year long partnerships.

When creators grow a substantial audience with good concentration of Active viewers and Superfans, introducing one’s own merch is a good business model. It helps in creating a closer community besides not limiting the income stream to content creation or brand deals.

The most common method of merchandising is introducing a line of apparels. Although in the past couple of years, merchandising has evolved significantly. Some of the examples are: Mr. Beast Burger by Mr. Beast, Dispo (photo sharing app) by David Dobrik, Chamberlain coffee by Emma Chamberlain, Latercase by UnboxTherapy.

Paid Content
Paid Content is a content behind a paywall and can only be unlocked by paying for it. Again, it is only feasible when a creator has a decent number of active viewers and superfans. Categories of paid Content are:
a. Online courses: Exercised by creators generating knowledge through their content. If a course is worth ₹1,000 and 100 people opt for it, a creator can generate ₹1,00,000.
b. Monthly subscription to Exclusive Clubs: Audience can join various membership clubs for as little as ₹29/month and get access to exclusive content, and have better reachability with the creator.

  • Ryan’s World is a children’s YouTube channel featuring Ryan Kaji, a 9 year old, along with his mother. According to Forbes, Kaji was listed as the highest paid youtuber for the year 2018 and 2019, earning $22 million and $26 million respectively from his videos and product line. 
  • On October 9, 2006, Google announced that it had acquired YouTube for $1.65 billion in Google stock. The Daily Telegraph wrote that in 2007, YouTube consumed as much bandwidth as the entire Internet in 2000.
  • Susan Wojcicki is the CEO of YouTube. Wojcicki was involved in the founding of Google, and became Google’s first marketing manager in 1999. She proposed the acquisition of YouTube by Google in 2006, and has served as the CEO since 2014.

Why Is SEBI Calling For A Separate MD And Chairman Position?

The story dives into the reason as to why did SEBI call for separate position of CEO and MD for the top 500 listed entities.

Recently, SEBI Chairman Ajay Tyagi had asked top 500 listed Indian companies to have separate position for Chairman and Managing Director in the firms. But what is the reason for having separate individuals for these two key positions? And what benefit will this compliance do? Whom will it benefit? Let’s find out.

Crux of the Matter

In late 2019, Securities and Exchange Board of India (SEBI) announced the requirement of the top 500 listed companies to divide the positions of chairman and MD (CEO). The mandate was to initially come into effect from April 1, 2020, however, it was further delayed by 2 years to April 2022.

The mandate was made post the recommendations of Uday Kotak Committee (2017) on strengthening Indian Inc’s Corporate Governance.
The purpose to bring in this compliance was:
a. To bring in transparency, balance and equity in various affairs of Board of Directors
b. Reducing concentration of power and authority upon one individual
c. Improvement in overall Corporate Governance

Chairman And Managing Director (MD)
Chairman heads the board of directors and is also appointed by them. He/She represents the firm’s shareholders and is thus expected to look after their interests.

Managing Director/Chief Executive Officer is the key executive of an organisation. He/She is responsible for the day to day operations of the frim and is responsible for its overall growth and development. CEO/MD’s compensation largely depends upon the company’s financial performance.

Conflict Of Interest
Since the company’s performance is directly related to the perks and compensation an MD/CEO gets, they have the potential to take decisions considering only the financial performance of the firm and ignoring the rest of the stakeholders. Now if Chairman (Board’s head) is same as MD, it is likely that the decision may be biased. The Board generally supervises the MD, and if the Chairman and MD are the same person, then how can the Chairman supervise the MD.

Chairman Eligibility
As per the new mandate, the selected Chairman should be :

  • A Non Executive Director
  • Should not be related tothe Managing Director or Chief Executive Officer

Status Quo
The following info graphic gives you a brief idea on the current situation with respect to the compliance:

  • The glass cliff is the phenomenon of women in leadership roles, such as executives in the corporate world and female political election candidates, being likelier than men to achieve leadership roles during periods of crisis or downturn, when the chance of failure is highest.
  • The Securities and Exchange Board of India Act, 1992 provides for the establishment of Securities and Exchange Board of India following the Harshad Mehta scam. When the scam was discovered in April 1992, the Indian stock market collapsed, and the same banks suddenly found themselves holding millions of INR in now useless debt. 
  • Controller of Capital Issues was the regulatory authority before SEBI came into existence; it derived authority from the Capital Issues (Control) Act, 1947.

What Are Benami Properties?

What Are Benami Properties?

According to a recent circular by Ministry of Company Affairs, from 1st April 2021, companies will now be required to disclose holding of Benami Properties. The move has been made in a bid to enhance transparency in the dealings of company’s affairs. But what is a Benami Property and why has the disclosure been mandated? Find it out today!

Crux of the Matter

What Is Benami?
The literal Hindi translation of the word benami is without a name. Thus, any property bought by an individual not under his/her name is a Benami Property.

A property is bought and registered under the name of Mr. Y. However, the consideration, i.e. the price to buy the property was paid by Mr. X from his unknown sources of income. Thus Mr. Y is only the holder of the property (Benamidar) while Mr. X is the real beneficiary. This entire transaction is termed as a Benami Transaction.

Why Is Benami An Issue?
Through the route of Benami transactions, individuals tend to convert their black money into white. Moreover, ownership of the property is disguised for tax avoidance, increasing personal wealth, hoarding money from unaccounted sources, etc.

What All Can A Benami Property Include?
The following assets and rights are included under the scope of Benami Property.

The first law was that of Benami Transactions (Prohibition ) Act , 1988. It was later amended to Benami Transactions (Prohibition) Amendment Act, 2016. The amendment was introduced as the older law was much ineffective and lacked the basic procedure of putting the legislation in action.

When the amount is paid from known sources of Income, following transactions do not fall under the purview of Benami Act:
– Property held by a member of HUF for the benefit of the latter,
– Holding property in fiduciary capacity of an institution,
– Property in name of spouse or children, and
– Jointly held by brother or sister or lineal ascendant – descendant.

The following penalties are levied under the legislation
– Confiscation of a Benami Property by Central Government
– Fine up to 25% of the market value of property
– Imprisonment from 1-7 years

For an individual providing false information or documentation of a Benami Property, the penalties are:
– Fine up to 10% of the property’s market value
– Imprisonment from 6 Months – 5 years.

Status Quo
Until January 2019, IT department confiscated assets of ₹6,900 crores. 24 dedicated Benami Prohibition Units are set up across the country for identifying the Benami properties. Moreover, reward scheme up to ₹1 crore is prevalent for individuals informing about the Benami Transactions.

  • In March 2018, it was revealed that the amount of Indian black money currently present in offshore banks is $1.5 trillion.
  • The book The Black White & Grey: Re-Coloring The Rupiah, authored by Pragun Jindal, looks at the black money menace and ways to curb it.
  • A right to property is recognised in Article 17 of the Universal Declaration of Human Rights, but it is not recognised in the International Covenant on Civil and Political Rights.

Understanding Startups And The Benefits They Get In India

Understanding Startups And The Benefits They Get In India

India reportedly has world’s third largest startup ecosystem. Moreover, it is expected to be a home to 50 unicorns by end of 2021. Doesn’t it sound amazing? Well, if you aspire to become an entrepreneur one day, India is definitely heading towards becoming a great place for startups. Read the story to know how you can be a part of it.

Crux of the Matter

What Are Startups?
Before actually getting into all the methodological work let us understand what makes a startup different from any normal business.
As reported by Forbes “Startups are young companies founded to develop a unique product or service, bring it to market and make it irresistible and irreplaceable for customers.”. Thus, startups are ought to be disruptive.

3 Things Essential To Qualify As A Startup In India

  1. Your firm should be registered in India up to 10 years from its date of incorporation.
  2. Business’s annual turnover shall not exceed ₹ 100 crore for any of the financial years.
  3. The startup entity could be a private company, limited liability partnership or a partnership firm.

Moreover, an Indian Startup should be working towards innovation, development or improvement of existing products and a scalable business model with a high potential of employment generation or wealth creation.

What Is Startup India?
With the Motive of availing a conducive entrepreneurial culture in India, Start Up India was launched in January 2016 by the GOI

Benefits That Startups Get Over Other Businesses
Tax Holiday
Startups get exemption from paying Income Tax for a period of 3 years from the date of incorporation. The only requirement is getting a Inter-Ministerial Board Certificate to avail the benefit

IP Filings Cost Reduction
There has been an 80% reduction in the cost of filing Patents, with startups bearing only statutory fees.

Quick Exits
The liquidation and winding up of a startup shall not exceed more than 90 days of application filing.

Incentives to Invest
Individuals investing their capital gains in ventures set up by government will get tax exemptions from Capital gains. These benefits boost investor confidence in Venture Capitalists and thus make the required money flow available.

Some Startup Stats

  • There were 40,000 active startups in 2020.
  • $63 billion was raised between 2014-2019.
  • Average time taken by Indian Startups to reach Unicorn Stage was 7 years.
  • Bangalore ranked as one of the world’s five fastest growing startup cities.

Read more: A Look at India’s Defence Startups

  • In 1994, Amazon was started as Cadabra Inc. Bezos also considered naming the online store,
  • Uber was founded in 2009 by Garrett Camp and Travis Kalanick as Ubercab. However, they changed its name to Uber in 2011 after complaints from San Francisco taxicab operators.
  • Started in 1999, India’s first e-commerce website is

Meet India’s Latest Unicorn: ShareChat

Meet India's Latest Unicorn: ShareChat

Within half a decade of operations, ShareChat has raised $766 million and is now valued at $2.1 billion, making it India’s 9th Unicorn of 2021. Major investors include Tiger Global Management, LightSpeed Ventures, Twitter and Snap Inc. Known for creating a vernacular niche, ShareChat exploited the Indian Market after TikTok’s exit. But do the company’s financials justify such a mammoth valuation? Or is it its high user base that the investors are banking on? Read the story to find out.

Crux of the Matter

What Is ShareChat?
Owned by Mohalla Tech, ShareChat is a social media platform that enables users to share images, videos and status updates in their regional language. It also allows interactions with other users on the platform. It also owns a short video platform Moj – that was launched in June 2020 to fill the vacuum created following TikTok’s ban.

User Statistics

  • ShareChat monthly active users – 160 million
  • Moj Monthly active users – 120 million
  • It had vernacular presence in 15 regional languages.
  • On an average users spend 30 minutes every day on both the platforms.

Acquisitions Under Mohalla Tech

  • March 2019: Clip – A Short video sharing platform which hosted nearly 10 mn monthly active users (MAU) prior to acquisition.
  • Feb 2020: Elanic– An Online Fashion Marketplace that had 5 mn downloads and 1 mn MAU.
  • March 2020: Memer– It is a Meme discovery and sharing platform that dwells over 1 million originally content pieces.
  • August 2020: Circle Internet– A Platform providing local information in vernacular to users in tier II and tier III Indian cities. Dwells a network of 1k volunteers.

Business Model
Online Content Creation Business Models fall majorly in 2 categories:
A. The content is created and owned by the platform creators.
B. User generated content community – where customer creates the content. ShareChat works as per this model.

Revenue Model
Just like most of the user generated content, ShareChat makes revenue through advertisements. In FY 2020, 95% of the operational revenue was earned out of the advertisement contracts. Other income sources which stood at ₹ 28.74 cr came from interest earned on FDs and investments.

The Road Ahead
Both ShareChat and Moj have grown exponentially post the government ban on Chinese social networking apps.
The latest funding of $503 mn will be invested in enhancing the content recommendation tech of the platforms. As reported by the CEO, Ankush Sachdeva,the plan is to invest more in Machine Learning and AI in order to avail users customized content.

  • In a tweet, Ankush Sachdeva, co-founder and CEO of ShareChat, said the Moj app was coded in 30 hours. It has received Google Play Best of 2020 Awards, as of 1 December 2020.
  • The first ever tweet was “just setting up my twttr“. It was written by Jack Dorsey, co-founder and CEO of the company.
  • “Me at the zoo” is the first ever video to be uploaded on YouTube. It featured YouTube co-founder Jawed Karim.