In “state of the creator economy” memo, MrBeast’s manager warns creators about TikTok investments

Reed Duchscher sees a bright future for U.S.-based creators — but he also thinks they should be wary about working with TikTok. Duchscher, who is the CEO of management firm Night, talked about CPMs, TikTok bans, and other hot-button issues in a “state of the creator economy” memo.

Duchscher sent the memo to Night’s partner creators — a group that includes YouTube big shots like MrBeast and Safiya Nygaard — before sharing it publicly on his LinkedIn profile. “With VidCon beginning this week I thought it would be a fitting time to share Night’s POV on the state of the creator economy,” the Night CEO wrote.

Much of Duchscher’s analysis focuses on two tech giants: YouTube and TikTok. He advises creators to be wary about their investments on the latter platform, since its “constantly changing algorithm” could cause problems for those who are “overly reliant” on it.

Duchscher also believes that the governmental pressure TikTok faces will only become greater as the 2024 presidential election approaches. In order to evade that “regulatory risk,” Night clients are advised to diversify their online activities.

A significant amount of that diversification can come through YouTube. In his memo, Duchscher acknowledges that YouTube ad rates are down, with CPMs falling about 10% year-over-year. But even in a difficult market, the Night CEO believes long-form YouTube videos “hold way more value” than short-form formats. That value is created by YouTube’s popularity among young people, its favorable revenue-sharing programs, and its growing presence on TV screens.

Duchscher also shouts out a few strategies that his team at Night has put to use. For example, he encourages creators to launch their own consumer brands; Night partners like MrBeast and Aphmau have done exactly that. The memo also encourages readers to “invest in high-performing teams” that can work together to tackle big projects.

More analysis of Duchscher’s memo can be found over at Fortune.