• Instagram compiles a list of topics it thinks you're interested in inside the Instagram app itself, which is used to show you relevant ads. 
• You can check the list for yourself with just a few taps into some of the Instagram app's deeper settings. 
• My own list of supposed interests starts out accurate, but some missed the mark.
• Visit Business Insider's homepage for more stories.

You can see what Instagram thinks you're interested in by going into the app's deeper settings options.

The list of interests is, of course, related to ads and ad data. Instagram says your ad interests are based on a combination of who you follow, what posts you like or comment on, and other websites and apps you use. If you have a Facebook account, Instagram pulls data from there, too. 

I checked my own list of topics that Instagram thinks I'm interested in, and it's a little confusing. I'm not particularly interested in many of the topics in the list that Instagram has built for me. 

For example, I'm not especially interested in tattoos, or physical fitness, and I really don't care much about video games at all. Instagram definitely knows me well from my first interest, though: online shopping. I've clicked through enough Instagram ads, and follow enough influencers who tag all their clothes, to see how that one ended up in my interests. 

You can check your own list of topics of interest that Instagram has compiled about you to see if it's accurate. Here's how.

Antonio Villas-Boas contributed to an earlier version of this post.

SEE ALSO: A nurse's viral TikTok video urging abstinence is sparking conversations about other times medical professionals have been 'patronizing' or shown prejudice

From the Instagram home page, tap the profile icon on the bottom right.

Then, tap the menu icon on the top right.

Next, tap "Settings" ...

... select "Security" ...

... and hit "Access Data."

You'll need to scroll all the way down and tap "View All" under "Ads Interests."

There, you'll be able to see what kinds of topics Instagram thinks you're interested in. There are dozens of interests on the list — just keeping tapping "View More" and the list will fill in.

Facebook, which owns Instagram, categorizes users by their interests to more easily sell their data to advertisers. Websites like Facebook and Instagram collect users' interests, along with demographics like age and gender, to determine what ads they will see. A recent article in The Cut looked at how ads break down by gender, where women tend to see disproportionately more ads for bras, home decor, and supplements, just to name a few. These definitely check out with my experiences, too. 

Facebook has faced criticism and legal trouble for how it has used this data in the past. Facebook was involved in several scandals over mishandling customer data, and CEO Mark Zuckerberg appeared before Congress to talk about how data analytics firm Cambridge Analytica improperly gained access to the data. Facebook can even follow what you buy in physical stores.

More recently, one of Instagram's partners, Hyp3r, was able to collect user location data and secretly save their stories, a practice which only stopped after Business Insider reported on it. 

If you don't want to see ads based on your data like this, you're in luck. This summer, Facebook introduced a feature that shows where ads come from, and allows you to opt out of targeted ads under your settings. Those settings then carry over to Instagram.

• This month, Tesla became the most highly valued car company despite selling far fewer units than Ford or GM — despite claiming to spend nothing on advertising and only $70 million on marketing last year.
• An internal marketing document viewed by Business Insider shows that it sought to be seen as a lifestyle brand that makes the highest-quality products in the world.
• The document puts a big emphasis on promoting Tesla cars' esthetic appeal and calls them the "safest, quickest" out there. 
• Click here for more BI Prime stories.

Tesla's valuation hit a record high this month, with the electric car maker's market cap exceeding Ford and GM combined despite selling far fewer cars than those giants.

The Palo Alto-based company doesn't do traditional advertising and is known for being secretive about its operations. But according to an internal brand positioning document created for Tesla by a marketing vendor and reviewed by Business Insider, Tesla wants to be seen as a lifestyle brand known for the high quality of its products.

Tesla representatives did not respond to a request for comment.

Tesla markets itself as a lifestyle brand that goes well beyond 'the safest, quickest cars on the road'

In the internal document, dated early 2018, Tesla sees its "ecosystem" of products, which range from the signature electric cars to wireless phone chargers, solar panels, and surfboards, as a "one stop shop to power your lifestyle."

The document shows how Tesla wanted to "empower" customers to manage their energy consumption, but stopped short of making heavy-handed references to "purpose" or the company's mission of helping the world transition to sustainable energy.

Instead, the document emphasizes the quality and exclusivity of Tesla's products and potential savings of going electric with phrases like "maximize your economic benefit."

The key theme of the company's marketing is that Tesla makes "the best products in the world," designed to provide the "best experience ever" by way of greater energy independence. "Our cars are the safest, quickest cars on the road," the document reads.

Around the time the document was produced, the National Safety Council and similar organizations questioned the veracity of these claims and others made by Musk.

The document also reinforces the seriousness of the brand by encouraging references to Tesla's aesthetic appeal and warning against copywriting tropes like puns.

Tesla has eschewed paid advertising

Musk tweeted last year that he'd rather put ad dollars into making better products.

Yet the company spent $70 million on "marketing, promotional and advertising costs" in fiscal year 2018, according to SEC filings.

Tesla relies heavily on direct, or email-based, marketing to drive online sales. It also gets far better engagement on social media than other major auto brands without paying for placements, thanks to superfans who closely track its products and stock valuation and Musk's pronouncements.

The fact that the company's strategy focuses so heavily on earned media driven by its reputation reflects employees' deeply held belief in its mission, said a source from the vendor who worked with Tesla on several digital marketing and design projects. The source, whose identity is known, requested anonymity because he or she is not authorized to speak publicly about the business.

"The mythology of Tesla and Elon is very valuable to them," the source said. "They control their earned media story very well."

Got more information about this story or another ad industry tip? Contact Patrick Coffee on Signal at (347) 563-7289, email at pcoffee@businessinsider.com or patrickcoffee@protonmail.com, or via Twitter DM @PatrickCoffee. You can also contact Business Insider securely via SecureDrop.

SEE ALSO: Casper doesn't only want to be a mattress company. Here are all of the products it might build next, according to its IPO filing

Join the conversation about this story »

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Hi, and welcome to this week's Influencer Dashboard newsletter!

This is Amanda Perelli and I'll be briefing you on what's new in the business of influencers and creators.

This week, I looked at how much YouTube pays creators on a single video with 100,000, 1 million, and 150 million views. The big takeaway: the rate that YouTube pays creators per view can vary wildly.

For instance, four creators I spoke to told me how much money they made from videos with more than 1 million views (and less than 1.5 million views) — and their answers ranged from $2,000 on the low end to a whopping $40,000 on the high end.

Why is that?

How much YouTube pays creators per 1,000 views (called the CPM rate) varies depending on how long viewers watch for, the length of the video (and how many ads it contains), the viewer demographics, and other factors.

Some videos that contain swearing or copyrighted music are even flagged by YouTube and demonetized, earning hardly any money for the creator (or none at all). One of YouTube's biggest stars, David Dobrik, recently said in an interview that he earned about $2,000 a month from YouTube directly, despite his weekly videos gaining an average 10 million views. He earns most of his money through brand sponsorships instead, like his partnership with SeatGeek.

Read my full post to learn how much YouTube paid some top creators for 100,000, 1 million, and 150 million views – and the strategies they employ to help boost earnings.

You can read most of the articles here by subscribing to BI Prime. And if this is your first time reading Influencer Dashboard, subscribe to the newsletter here.

3 Pinterest influencers explain how much money they charge brands for sponsored pins and how the rates compare to Instagram

Pinterest is an afterthought to some in the influencer marketing business, but popular creators are making thousands of dollars from it.

Dan Whateley, our new reporter on the business of influencers team, spoke to three Pinterest influencers about how they make money from the social platform.

One of the influencers, Erica Chan Coffman, who has 6.2 million followers, told Dan that on average she charges brands between $500 and $1,500 for a sponsored pin.

That's a significant amount of money, but here's some context: She still makes more money from brands on Instagram, where she only has 120,000 followers.

Coffman said her Pinterest sponsorship price shifts based on what board she's posting on, the amount of graphics work required to create the pin, and whether it's long or short-form content.

Read the full post on how much money 3 Pinterest influencers make for sponsored pins.

A YouTube creator with 1.4 million subscribers shares how much money she made in 2019 from ads

How much money does a YouTube creator with 1 million subscribers make in a year? 

Well, that depends on a variety of factors (remember CPM rate from earlier?) – and can be helped by certain techniques. 

Shelby Church, a YouTube creator with 1.4 million subscribers, told me that in 2019, she earned more than double what she earned in 2018 from YouTube ads.

Church said she earned more primarily because of a certain strategy she began to use in mid-2019.

Read the full post on how much YouTube paid Church in 2019 and her strategy.

A top digital-talent exec at WME breaks down the big influencer deals of 2019 and what he's looking for in 2020, from TikTok to touring

Since the rise of digital media, Hollywood's top talent agencies have developed departments for influencers who are popular on platforms like YouTube, Instagram, and now TikTok. 

I spoke with Jad Dayeh, a partner and the cohead of digital at William Morris Endeavor, who thinks the buzzy video app TikTok is "undeniably connecting with youth culture on a global level."

Dayeh broke down the big influencer deals of 2019 and shared what he's looking for in 2020.

Read the full post on Dayeh and the new opportunities and ways to earn major cash he looking for in 2020.

Marketers share what it's like to use TikTok's invite-only tool for finding the right influencers to hire for brand deals

TikTok is looking to compete with platforms like YouTube and Instagram, which provide marketers and influencers more robust sets of tools to strike deals and build their businesses.

Dan reported on TikTok's new influencer-marketing tool, which is designed to help brands find the right influencers to hire.

This tool, called Creator Marketplace, is in beta and available to only a few hundred users – but Dan was able to get some marketers with access to the platform to break down how it works and share their experiences using it.

Read the full post on what it's like to use TikTok's invite-only tool for finding the right influencers to hire for brand deals.

Send tips or feedback to me at aperelli@businessinsider.com. 

Here's what else we're reading:

• Court records reveal a 24-year-old influencer accused of scamming his fans legally changed his name to pose as a 16-year-old actor: Connor Perrett, from Insider, reported on a social-media star who vanished following accusations that he had scammed his fans. The star returned last year under a new personality, and Insider obtained court records which show the influencer changed his name to his new alias.

• Chase Hudson and TikTok Collective the Hype House Sign With WME (Exclusive): Natalie Jarvey, from The Hollywood Reporter, wrote that TikTok star Chase Hudson signed with top talent agency WME. WME will work with Hudson on areas in digital, fashion, modeling, music, touring, and more, Jarvey wrote.

• TikTok Stars Charli and Dixie D'Amelio Sign With UTA (Exclusive): UTA strikes back! Jarvey also reported that TikTok stars Charli and Dixie D'Amelio (along with their parents) recently signed with top Hollywood agency (and WME rival) UTA. The agency will work with the family on digital content, live touring, podcasts, books, TV, and licensing and endorsements, Jarvey wrote. Clearly, the TikTok talent wars are in full swing.

Join the conversation about this story »

NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

• While many direct-to-consumer upstarts matured in 2019, other new ones are emerging.
• Investors such as Greycroft's Ian Sigalow, Science's Peter Pham, and former Google and Oath exec Tim Armstrong are backing DTC startups like Kangaroo, Tonal, and StockX.
• Business Insider asked 16 investors which DTC companies they think will blow up this year and why. 
• Many named health and wellness-focused and drink companies, like 8Greens, which makes health supplements from green veggies; and Talea Beer, aimed at women.
• Click here for more BI Prime stories.

While many direct-to-consumer upstarts matured and became viable businesses in 2019, hundreds continue to crop up in an attempt to disrupt categories across the board — from beauty and supplements to home fitness. 

Business Insider asked 16 investors which DTC startups they think will blow up this year and why.

Most of them picked companies they've invested in. Investors from DTX Company, Greycroft, Lerer Hippeau said they are backing companies that are cashing in on big trends and entering categories that are ripe for disruption. They include home fitness company Tonal, which trying to follow in the footsteps of Peloton; and Kangaroo, which is getting into home security.

As it was last year, beverages remain a hot category, with investors naming Kin Euphorics, Minna Tea, and Talea Beer as ones to watch. Health and wellness also is attracting investment, with investors citing 8Greens, Daily Harvest, and Oura as having big growth potential.

8Greens

Company: 8Greens

Recommended by: Neda Daneshzadeh, partner, Prelude Growth Partners

Relationship to the company: Investor

What it is: A health supplement company that makes effervescent tablets, gummies, and other products from blended greens like spinach and kale. 

Why it's hot:"87% of Americans do not get their daily minimum requirement of greens. 8Greens is made from real greens, has zero sugar and just 15 calories," Daneshzadeh said. "It's a female-founded business, and is led by CEO Eduardo Luz, the former president of grocery and chief brand officer at Kraft Heinz."

Blueland

Company:Blueland

Recommended by: Nisha Dua, general partner, BBG Ventures

Relationship to the company: Seed investor

What it is: Household cleaning company with a mission to reduce single-use plastic consumption.

Why it's hot:"Sustainable consumerism is on the rise, but consumers still value price and quality above all else. Blueland has tapped into this with a cost-effective product that's as efficacious as existing products on the market," said Dua. "They aren't just marketing themselves as a sustainable brand or refilling bottles, but have invented an entirely new form factor with their tablets — something the large incumbents have yet to do. All you need to do is add water and the Blueland tablet to the bottle."

Choosy

Company:Choosy

Recommended by: Charlotte Ross, principal, Inspired Capital

Relationship to the company: Investor

What it is: A fashion brand that creates algorithmically inspired outfits by scraping trending posts on Instagram. 

Why it's hot:"Choosy represents the future of fashion — it's able to predict the latest trends with AI and machine learning technology, which have been proven to perform better than human-created styles," said Ross. "Its proprietary supply chain also enables it to create clothes made-to-order, preventing the extreme waste that the fashion industry is known for."

Co Star

Company: Co Star 

Recommended by: Anarghya Vardhana, partner, Maveron

Relationship to the company: Investor

What it is: An astrology based social app.

Why it's hot:"People are increasingly looking for meaning, purpose, and connection in life. In an increasingly lonely and polarized world, an app like Co Star can help bring people closer to themselves and to the people around them," Vardhana said. "Co Star uses astrology as a way to enable people to introspect and examine their lives individually and in relation to others." 

Daily Harvest

Company: Daily Harvest

Recommended by: Courtney Reum, cofounder, M13

Relationship to the company: Investor and board member 

What it is: A frozen-meal delivery service that boasts healthy ingredients. 

Why it's hot:"Daily Harvest has changed consumers' relationship with the kitchen's most underutilized and underestimated appliance: the freezer. I don't go to the pantry anymore to grab and go; I get what I need from the freezer and it's not only nutritious but tastes good," said Reum. "They aren't even in retail yet, and have extended their product line significantly to offer a full-suite of products."

Frida

Company: Frida

Recommended by: Mike Duda, managing partner, Bullish

Relationship to the company: No investor relationship

What it is: Direct-to-consumer maker of babycare products like booger-suckers, butt-washers, and gas-relievers.

Why it's hot:"While perhaps not en vogue to pick a brand with zero venture funding, Fridababy has taken on a high passion category where brands have not built a relationship with their end-user," said Duda."And like most potential breakout brands, this one has exceptional owners: CEO Chelsea Hirschhorn quite literally put herself out there on the importance of postpartum, and husband CMO Eric Hirschhorn has dipped into his old Burger King days to focus on culture versus performance marketing."

Judy

Company: Judy

Recommended by: Nik Sharma, independent investor 

Relationship to the company: Investor 

What it is: Maker of emergency kits with products like flashlights, first aid supplies.

Why it's hot:"Judy is taking on a very underserved category — there are no viable competitors to the product, except AAA and the Red Cross," Sharma said. "And they also have a unique approach to distribution that combines the traditional DTC approach of using paid media with a very intimate IRL component of Judy classes, which teach mothers, fathers and those who want to learn how to prepare for these experiences with the products."

Kangaroo

Company: Kangaroo

Recommended by: Ian Sigalow, cofounder and partner, Greycroft

Relationship to the company: Seed investor

What it is: A do-it-yourself smart home security system.

Why it's hot:"If Ring's acquisition is any precedent, Kangaroo has the potential to reach a massive market US home owners because it offers state-of -the-art home security at a fraction of the price of its competitors," Sigalow said. "Since they manufacture their own hardware from scratch, it's a fully-integrated system where everything connects through your phone."

Kin Euphorics

Company: Kin Euphorics

Recommended by: Byron Ling, partner, Canaan

Relationship to the company: Investor

What it is: Maker of non-alcoholic functional drinks with ingredients like caffeine, adaptogens and nootropics, as well as supplements like GABA, 5-HTP and rhodiola extract.

Why it's hot:"Americans are drinking less alcohol, and while alcohol companies are responding to that by creating low-alcohol alternatives, Kin Euphorics is creating an entirely new category of functional beverages," Ling said. "Their entire approach, brand positioning and packaging is designed around a lifestyle of enabling consumers to socialize in a different way at night and also take back their mornings."

Live Tinted

Company: Live Tinted

Recommended by: Hayley Barna, partner, Firstround Ventures

Relationship to the company: Angel investor 

What it is: A community-centric beauty company founded by Instagram influencer Deepica Mutyala with products catering to diverse skin tones.

Why it's hot:"It's a bold and inclusive brand, and beauty industry royalty Bobbi Brown is among the investor group," Barna said. "It also expanded to international markets, and following the release of its cult color-correcting stick, will be releasing new products based on feedback from community."

Oura

Company: Oura

Recommended by: Kirsten Green, founding partner, Forerunner Ventures

Relationship to the company: Investor 

What it is: A ring that tracks sleep and activity.

Why it's hot: "It's lightweight, waterproof ring tracks sleep quality, sleep stages, ECG-level resting heart rate and variability, as well as body temperature during the day and night, enabling users to optimize their health outcomes," Green said. "We are waking up to the importance of sleep to foundational health. Oura has the potential to be a hub for all things sleep."

Minna

Company: Minna

Recommended by: Jon Keidan, Torch Capital

Relationship to the company: Investor 

What it is: A sparkling tea with no added sweeteners and organic, non-GMO ingredients. 

Why it's hot:"We continue to see better-for-you beverages stock the shelves across major grocery chains, regional supermarkets and local corner stores — and tea is the most popular drink in the world," Keidan said. "Within the sparkling beverage category, we were yet to see a clearly differentiated and stand-out product offering. Not only is Minna an incredibly delicious, clean and refreshing drink but their team has created a product that looks great, stands out on the shelves (and online), and encompasses an element of brand, mission and community that really stood out to us. It also donates a percentage of its sales to non-profits such as Choose Love and Help Refugees that advocate for inclusion in all forms."    

StockX

Company: StockX

Recommended by: Tim Armstrong, founder and CEO, DTX Company

Relationship to the company: Investor 

What it is: A direct-to-consumer marketplace for collectibles like clothing and sneakers.

Why it's hot:"StockX is hot because it has nailed a DTC marketplace for the hottest collectibles across all demographics," Armstrong said. "It has mixed, trust, branding, utility and coolness together into a consumer experience that is hard to resist and fun to use — Air Jordan meets DTC."

Studs

Company: Studs

Recommended by: Caitlin Strandberg, principal, Lerer Hippeau Ventures

Relationship to the company: Investor

What it is: A jewelry and piercing brand geared at Gen Z and millennials.

Why it's hot: "Studs combines both retail and e-commerce to provide consumers with affordable, high-quality, and trend-forward jewelry. Cofounders Anna Harman and Lisa Bubbers noticed a massively underserved market in the retail piercing space, where consumer options were limited to uninspired piercing jewelry from tattoo parlors and mall kiosks," Strandberg said. "Studs' brick-and-mortar studio offers everything from CBD beverages and 'earscape' consultations to special collaborations with brands like ManRepeller. Its online experience equally conveys the brand's ethos and mission of self-expression."

Talea Beer

Company: Talea Beer

Recommended by: Angela Lee, founder and CEO, 37Angels

Relationship to the company: Investor

What it is: New York-based beer company geared at women.

Why it's hot: "Craft beers have traditionally been directed at men, but with names like 'Lizard King, 'Arrogant Bastard Ale,' and 'Raging Bitch,' Talea Beer is hoping to disrupt the industry by bringing an easy-to-drink beer to women, a market that has until now been ignored," Lee said.

Tonal

Company: Tonal

Recommended by: Peter Pham, cofounder and partner, Science 

Relationship to the company: Angel Investor

What it is: A home-fitness device that combines a screen with weight machine arms.

Why it's hot:"Home fitness is getting a lot of attention because of Peloton, and Tonal is doing really well," said Pham. "Tonal has arms that pop out, and offers a full-weight gym in addition to instructors on the screen."

• 2020 is shaping up to be a big year for podcasting after Spotify kicked things off with its acquisition of Gimlet in 2019, and it's the one area of media that VCs are all talking about.
• We talked to five VC firms including Union Square Ventures and Greycroft about why they're big on it and which companies they're high on.
• They point to the market for paid podcasting and its low-cost appeal as a way to test interest in new content areas.
• Click here for more BI Prime stories.

2020 is shaping up to be a big year for podcasting. Spotify set the stage for the boom in 2019, spending $400 million to buy Gimlet, Parcast, and Anchor, and podcasting was one of the big trends at CES.

Talent agencies have gotten more involved, helping podcast stars move to other media, while top podcast platform Apple has reportedly started flexing its muscles, talking up content deals with podcast publishers. Meanwhile, Amazon and Google, with their smart speakers, are driving the audio ecosystem, and while their speakers don't carry traditional advertising, Amazon is cracking open the door more to get marketers promoting its Alexa voice platform.

After being burned on digital media startups, audio is the one media trend VCs keep talking about. We talked to five who are hot on the space about why they're big on it and which companies they're betting on.

There's a market for paid audio

$100 million podcast startup Luminary faced backlash over its plan to become the "Netflix of podcasts," but VCs still see a lot of potential for paid-for podcasts.

Comcast Ventures is an investor in TuneIn, an online radio streaming service that was early in putting audio content behind a paywall.

Amy Banse, managing director and head of funds at Comcast Ventures, said that now that people been trained to pay for video and other online content, the idea of paying for podcasts isn't far behind. 

"People have been trained to pay for video, and I think they'll pay for audio content as well," Banse said.

Lightspeed partner Nicole Quinn said this is already happening in China, where a burgeoning paid audio industry is at the core of an estimated $7.3 billion knowledge economy.

"We're always thinking cross-border," she said. "That trend is coming to the US, where there's premium content people will pay for."

It's a way for companies to market to customers

Podcast advertising is projected to more than double to $1 billion advertising by 2021 from 2018, according to eMarketer. Most of that advertising has traditionally been direct-response, but it's becoming more mainstream as more advertisers are drawn to the intimacy of podcasting and its loyal audiences. Marketers aren't lost on the trend. 

Dana Settle is a founding partner at Greycroft, whose portfolio includes Wondery, the company behind podcasts "Dirty John,""American History Tellers," and "Business Wars."

"We think as a medium, it's super interesting and a big growth area, in terms of platforms but in the ways our consumer companies are using podcasting to engage their audience in really interesting ways," she said.

It fits with people's behavior

In addition to consumer goods makers, media companies are using audio as a relatively low-cost way to test out the market for people's interest in a subject before investing more heavily in content creation. One of the best examples of this is The New York Times, whose "The Daily" has quickly become a top news podcast.

"Audio is going to become an increasingly big deal," said Fred Wilson, cofounder and partner at Union Square Ventures. "What The New York Times has done with 'The Daily' is really incredible ... A lot of people, that's the only New York Times content they consume."

He noted that the popularity of Apple's Airpods will help propel audio as a medium.

Heather Hartnett, CEO and general partner at Human Ventures, sees audio being a good way for media companies to test content, but also warned that the delivery of audio content is still archaic and hard to measure.

"We are still in the early days of podcasting," she said.

SEE ALSO: A VC partner who manages $1.4 billion in investments breaks down what she looks for in startups to know if they will win

Join the conversation about this story »

NOW WATCH: Behind the scenes with Shepard Smith — the Fox News star who just announced his resignation from the network

• Facebook will reportedly retreat from its efforts to include advertisements in WhatsApp's messaging service, the Wall Street Journal's Jeff Horowitz and Kirsten Grind reported on Thursday.
• The decision to disband a team dedicated to implementing ads on WhatsApp is a surprising turnaround in Facebook's efforts to monetize one of its most popular services. 
• A Facebook spokesperson confirmed that WhatsApp was currently prioritizing building features for businesses and pushing its payment services in other countries. Ads will remain a long-term opportunity for the company, the spokesperson said.
• The move comes more than a year after WhatsApp co-founders Brian Acton and Jan Koum left the company, after clashing with Facebook executives over the effort to monetize the app. 
• Visit Business Insider's homepage for more stories.

Facebook is shelving plans to include advertisements in its WhatsApp messaging service, according to a new report. 

The company recently disbanded a team that explored the best ways of integrating ads onto WhatsApp, the Wall Street Journal's Jeff Horowitz and Kirsten Grind reported on Thursday.

The move is a surprising about face in Facebook's efforts to monetize its various products, particularly one of its most popular services. Facebook acquired WhatsApp for $22 billion in 2014, and has since been searching for ways to monetize the company's 1.5 billion userbase. 

Facebook had previously said that WhatsApp would begin placing ads in the Status section of the app, beginning in 2020. The advertisement giant even teased what the new WhatsApp ads would look like at a Facebook Marketing Summit. 

But now, WhatsApp will focus on building features that let businesses communicate with customers in the app, as well as providing payments services to other countries, a Facebook spokesperson confirmed to Business Insider. Ads will remain a long-term opportunity but will not be subject to a specific timeline, the spokesperson said.

The tech giant's decision to shelve its WhatsApp ads plans comes more than 18 months after WhatsApp cofounders Brian Acton and Jan Koum left the company, along with a slew of other company executives. The two cofounders had been vocal about their opposition to advertisements long before Facebook had expressed an interest in buying the app, calling ads "the disruption of aesthetics, the insults to your intelligence and the interruption of your train of thought,"in a 2012 blog post.

Facebook's push to bring ads to the app had caused its co-founders to clash with Facebook CEO Mark Zuckerberg and COO Sheryl Sandberg. In a later interview with Forbes, Acton revealed that he had resigned from the company in protest of its efforts to sell ads on WhatsApp. 

SEE ALSO: The US and China's tech cold war is far from over, even with Trump's trade deal. Here's why tech companies will remain on the front lines of the trans-Pacific rivalry.

Join the conversation about this story »

NOW WATCH: Watch Elon Musk unveil his latest plan for conquering Mars

• Cosette Rinab is a junior at the University of Southern California and a TikTok creator with 1.6 million followers.
• She splits her time between studying film and public relations for school and growing her TikTok page.
• Rinab shared the ways she earns money through the app, including brand promotions, music integrations, and livestreaming.
• She said the average rate for a sponsorship on TikTok is between $1,000 and $2,000 per 100,000 views based on her experience and conversation with other creators.
• Click here for more BI Prime stories.

Cosette Rinab, a College junior, has a packed schedule. When she's not attending class or studying for an exam, she's working on her TikTok page. 

TikTok, the wildly popular short-form-video app, sat beside other giants like YouTube and Instagram on Apple's 2019 list of the top five free iPhone apps of the year. The platform is owned by the Chinese internet company ByteDance and has become one of the hottest social platforms among Generation Z.

Rinab got her start on TikTok about one year ago. Now she has 1.6 million followers and treats her account like a part-time job. She's also a full-time student at the University of Southern California.

"I found that a lot of my friends who were in college and then got involved with social media just kind of took a leave of absence from school or just dropped out completely," she said. "It's not easy to balance both of them, but I think it definitely can be done."

She told Business Insider that she was able to make it all work by dividing her week up into two parts. She attends classes in the first half of the week. In the second half, she works on her social media and as a freelance consultant helping companies learn how to use TikTok. 

Rinab shared with Business Insider the three main ways she earns money on TikTok as a creator and broke down the average rate creators charge per sponsorship. 

1. Brand sponsorships

Creators can land sponsorships through TikTok's monetization team (which reaches out to creators) using a brand or agency, or from a record label. For an official TikTok campaign, such as a "Hashtag Challenge," TikTok will provide the sponsorship to the creator directly.

Rinab earns most of her revenue through sponsored posts on TikTok, she said. She has a direct relationship with the company, and it occasionally brings her sponsorships — and sends her on all-expenses-paid trips.

In November, TikTok sent Rinab and other creators to Paris to judge the Elite Model Competition and teach a workshop on how to be a successful creator.

Working with TikTok directly has helped Rinab expand her business and land sponsorships with brands like Bumble, Hollister, and Universal. There are also some management firms, like Whalar Stars and Amp Studios, that help creators land deals and opportunities, but Rinab manages her TikTok business on her own.

"I also like managing it myself and communicating with the brands directly," she said. "As much as I think it would be cool to put the weight of communicating with brands and negotiating on someone else, I think I would feel like I'm missing out, just because I enjoy doing that so much." 

When negotiating with a brand for a sponsorship on TikTok, Rinab sometimes offers a package deal, which includes both a TikTok video and an in-feed post or Instagram Story, she said. 

She said she generally charges "a couple thousand dollars" for a brand sponsorship, and according to other creators she's spoken with, the average rate for a sponsorship on TikTok is between $1,000 and $2,000 per 100,000 views. 

Several Instagram influencers interviewed by Business Insider said creators often charge brands about $100 per 10,000 followers for a sponsored post on that platform, though brands are increasingly paying attention to metrics other than follower count.

Deciding on a set rate for TikTok can be tricky, Rinab said, and it's hard to pinpoint one amount because as she continues to grow in views and followers, her rates change. 

"Obviously the followers play a big part in it," she said. "I'm charging more at 1.5 million followers than I was at 800,000. But even so, I think the main thing that brands are looking for is the views." 

Rinab tracks her TikTok analytics like views and audience demographics, and at the end of a campaign, about 24 to 48 hours later, she sends that data to a brand to show how it performed. 

"At the end of the day, they are paying for a commercial to be produced and posted on the page," she said. "It's really important to know the value in that and know what they are getting out of it, and how your time should be compensated." 

2. Song integrations

Some record labels, such as Universal Music, Sony Music, and Warner Music, will sponsor a TikTok creator when they are looking to increase the number of streams of a popular song or make a song popular again.

Rinab said she works with companies like Flighthouse, a digital-entertainment brand that connects creators with musicians and pays them to create a video with a specific song. 

"I'll charge a couple hundred dollars for a song, just because it's a lot easier for me to put the song in the background," she said.

By comparison, Salina, a TikTok creator with 1 million followers, told Business Insider that she charges about $200 for a song integration. 

David White, the head of influencer management at the digital-talent-management firm Whalar Stars, said the factors considered when pricing a TikTok campaign generally are the creator's audience size, commercial licensing, brand exclusivity, and campaign scope. He said an audio integration for a record label was priced significantly less than an official brand sponsorship.

3. Livestreaming

Engaging with her audience by posting frequently and through livestreams is one of the techniques that has helped Rinab grow her following online, she said.

During a livestream, followers on TikTok can send a creator virtual "gifts" that they can purchase for various amounts of "coins" (coins can be bought by users in packs starting at 100 for $0.99).

TikTok users use cash to buy "coins," which they can then use to purchase the "gifts." Once they give the "gifts" to the livestreamer, those "gifts" are then converted into "diamonds." Those "diamonds" are then converted into cash for the creator and deposited into the creator's PayPal account.

The system for earning money through livestreaming is intentionally opaque. The rate of conversion from a "diamond" to cash is "determined by ByteDance from time to time in its absolute and sole discretion,"according to the company.

Rinab said that livestreaming on TikTok was a much smaller portion of her income than sponsorships.

For more on how to become a successful influencer, according to YouTube and Instagram stars, check out these Business Insider Prime posts:

• How much YouTube pays influencers for 100,000, 1 million, and 150 million views, according to top creators: We spoke with creators on YouTube who broke down how much money they've made on a single video from Google.

• A Harvard student with 300,000 YouTube subscribers shares exactly how much money she made in 2019 as a college influencer from ads: Sienna Santer, a second-year student and YouTube influencer with 302,000 subscribers, shared how much money she made from Google's AdSense in 2019.

• A TikTok star with 1 million followers explains the ways she earns money and how much she makes: The 22-year-old TikTok star Salina, who goes by "Salinakilla" online, explained the different ways creators earn money through the popular video app.

Join the conversation about this story »

NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

• Facebook is rowing back on plans to put ads in WhatsApp and has disbanded a team that was working on the effort.
• The surprise move suggests it will not be as simple for Facebook to monetize the app, which it acquired for $22 billion, as analysts hoped.
• Instagram was a template for a successful Facebook acquisition, with the company filling it with ads and turning it into a massive cash cow.
• But WhatsApp will need to find a new model, and the team is working on features that will let businesses interact with users.
• Click here for more BI Prime stories.

Facebook is backing off on plans to stick ads inside WhatsApp — raising questions about its vision for monetizing the messaging app.

The Menlo Park, California-based social networking giant acquired WhatsApp for a cool $22 billion in 2014, and the expectation has long been that it would — eventually — load it up with ads to monetize its millions-strong userbase.

But industry watchers that were hoping that day would soon materialise are out of luck: On Thursday, The Wall Street Journal reported that Facebook has paused its plans to add ads to WhatsApp. It has disbanded the team working on a team exploring the app's potential for ads, it reported, and "the team's work was then deleted from WhatsApp's code."

Facebook insists that it is still committed to adding ads to WhatsApp over the long term, and the full circumstances of the team's shuttering aren't yet known. But the news makes clear that WhatsApp's path to profitability won't be as simple as some had hoped.

Instagram stands as the prime example of Facebook's success with acquisition, acquired for a not-insubstantial $1 billion in 2012, it is now worth more than a hundred times that: An estimate in 2018 pegged it as worth $100 billion, and its value seems certain to have increased since then.

Instagram's advertising business is thriving, helping power Facebook's continued growth in profits, revenues, and users, and has been hailed as"arguably the best acquisition in the history of tech." Its ad business is functionally similar to the core Facebook app's — ad buyers pay to target users with ads that appear in their feeds, and later, in the ephemeral Stories feature too — and was viewed as a business template for how Facebook could spin up wildly profitable advertising units in other services it builds or acquires.

WhatsApp's future will now evolve differently. A company spokesperson told Business Insider that it is now focusing on building other features that allow businesses to interact with ordinary users, like catalogs that can show what a business has for sale. They said it does still plan to eventually add ads to Status, WhatsApp's version of stories posts that delete after 24 hours, but didn't offer any kind of timeframe for doing so.

The messaging app may still make money off this business-feature approach, either by charging for access to certain features or via developing its ecommerce tools that might allow it to take a cut of purchases and payments made through the platform. (Ecommerce and payments may ultimately bring in billions of dollars a year in new revenue for Facebook.)

Bank of America analysts previously predicted in December 2019 that advertising — along with payments and transactions — on WhatsApp and Messenger could add $12 billion in annual revenue over the next three to five years, working to offset the cost of maintaining the messaging apps for Facebook and start generating profits. Facebook's decision raises question marks over such estimates.

WhatsApp remains an incredibly strong product, with more than 1.5 billion monthly active users (as of 2018). But Facebook's strategic shift indicates that turning it from a popular app into another cash cow won't be as simple as turning an ad spigot to replicate Instagram's success.

Do you work at Facebook? Contact this reporter via encrypted messaging app Signal at (+1) 650-636-6268 using a non-work device, email at rprice@businessinsider.com, Telegram or WeChat at robaeprice, or Twitter DM at @robaeprice. (PR pitches by email only, please.)

Read more:

• Instagram's lax privacy practices let a trusted partner track millions of users' physical locations, secretly save their stories, and flout its rules
• Mark Zuckerberg's personal security chief accused of sexual harassment and making racist remarks about Priscilla Chan by 2 former staffers
• Facebook says it 'unintentionally uploaded' 1.5 million people's email contacts without their consent
• Years of Mark Zuckerberg's old Facebook posts have vanished. The company says it 'mistakenly deleted' them.

Join the conversation about this story »

NOW WATCH: Most maps of Louisiana aren't entirely right. Here's what the state really looks like.

• IHeartMedia recently announced a round of layoffs, saying it was part of a "modernization" process for the company, as it relies increasingly on technological investments to power operations.
• Laid-off employees from local iHeartMedia radio stations told Business Insider they were caught off guard by the cuts, especially of those who worked in high-performing markets.
• IHeartMedia is the largest radio network in the US, and the reorganization suggests the company will rely more on central programming and syndication for local stations. 
• Business Insider spoke with 12 laid-off employees who described how they received the news and what they think was behind their layoffs.
• Click here for more BI Prime articles.

Adam Diaz first started listening to iHeartRadio when he was in the hospital recovering from a back injury that resulted in his medical retirement from the US Coast Guard.

Seven years later, he was hired as a part-time board operator at one of the company's local radio stations in the Delaware area, where he went on to work as an executive producer for country music show "Nashville's Next with Benny."

Diaz said he loved his industry, his company, and his job.

But when iHeartMedia announced this week that it would reorganize to keep up with the modernization of audio, he became one of many local radio workers laid off at the largest radio network in the US.

AllAccess, a radio industry news site, published lists of employees who were laid off, and their count shows more than 100 were let go. Business Insider spoke with 12 laid-off employees, some of whom reported hearing that thousands could be laid off. 

IHeartMedia has 12,500 employees in all, and the company said in a statement to Business Insider the number of layoffs was "relatively small" but wouldn't give an exact figure.

But whatever the exact number, a handful of former employees said the loss of on-air hosts and program directors around the country was already noticeable in local markets.

"I hope the best for the company's and radio's future, but I'm afraid this move will prove damaging to the emotion that makes radio successful, to the culture and soul of the industry," Diaz said.

IHeartMedia insiders were surprised by the layoffs, although some said a recent managerial meeting was an omen

Some former employees who worked at iHeartMedia for decades — since the days when the company was known as Clear Channel — said morale has been declining for several years as traditional radio struggled to maintain audiences who are turning to streaming and podcasting. 

Still, despite red flags, former employees who spoke with Business Insider soon after being laid off described being blindsided by this latest blow to the radio industry.

Looking back, some said they should have expected a reduction in force last week, when iHeartMedia called a meeting in New York City for high-level managers.

"We knew something bad was going to come of it, but we didn't know what," said one former program director who spoke to Business Insider on the condition of anonymity because his severance package had not been finalized.

Then, on the morning of Jan. 14, CEO Bob Pittman sent a company-wide email referencing restructuring, and the company publicly announced layoffs. Minutes later, hosts, program directors, executive producers, board operators, and other local staffers around the country felt their phones buzz with calls from their managers.

Managers tasked with conveying the news of the layoffs were given scripts to read, several former employees said, and without specific reasoning as to why they were being let go, many employees caught up in the reduction were left wondering why they were out of a job.

Billy D'Ettorre, a producer of the "Brother Wease" morning show on WAIO in Rochester, New York, said he felt as if his more than 10 years of work at iHeartMedia were all for nothing when he lost his job.

"It caught me totally off guard," D'Ettorre said. "I was literally talking to one of my coworkers about how we were going to handle an upcoming vacation day I had … when our program director came and said, 'Billy, I need to see you.'"

IHeartMedia recently emerged from bankruptcy

In 2018, iHeartMedia filed for Chapter 11 bankruptcy after a leveraged buyout in 2008 left it with over $20 billion in debt for the next decade.

Less than a year ago, the company completed a separate restructuring process that reduced its debt from $16.1 billion to $5.75 billion and split it from Clear Channel Outdoor Holdings.

Considering the remaining debt, a few former employees speculated that the most recent round of layoffs was an attempt to save money.

But even well-performing markets with beloved hosts were not spared, some former employees said.

IHeartMedia said the new structure would allow the company to "take advantage of the significant investments it has made in technology and artificial intelligence and its unique scale and leadership position in the audio marketplace."

In a statement, the company said the job cuts were determined by "location" and "function," but wouldn't elaborate.

As iHeartMedia turns to tech to power programming, localized radio content falls by the wayside

IHeartMedia already relies on some centralized programming, or generalized broadcast content meant to be played across multiple stations, but this recent round of layoffs is indicative of a further push into centralizing programming.

As examples, company insiders described how one disc jockey can curate playlists for dozens of local stations, and one morning show host can record content from one city to be broadcast around the whole state. AI technology can even customize playlists for specific communities.

"We are now using our considerable investments in technology to modernize our operations and infrastructure, further setting us apart from traditional media companies," Pittman said in a statement.

As part of the restructuring, iHeartMedia said it would group its markets into three categories based on common needs and characteristics: The region, metro, and community divisions.

The company's largest markets that encompass hundreds of cities, like New York City and Los Angeles, make up the region division. The metro division is comprised of slightly smaller markets that still reach multiple communities, and the community division includes small markets grouped by geographic location and cultural similarities.

"We will continue to serve every local community in which we operate, just as we always have," the company said in a statement.

But it may serve them in a different way. A former program director said that over the past year he's seen national teams of DJs working out of one city to curate playlists for multiple stations, but that he expected that sort of content, as well as syndication, to become even more common in 2020.

"I think a lot of centrally programmed stations will come out of this," the program director said. "You're going to see local stations with one or two disc jockeys now have none."

But while centralized programming reduced the need for DJs and hosts, those who lost their jobs said many listeners quickly noticed the change.

"The response to my being let go has been overwhelming," said D'Ettorre, who announced his departure on Facebook. "It's stunning. I've gotten hundreds, maybe thousands of responses."

SEE ALSO: A music artist breaks down exactly how much money Spotify, Apple Music, Pandora, and more paid her in 2019

Join the conversation about this story »

NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

• In an influencer marketing world dominated by Instagram, having a large Pinterest following doesn't guarantee big sponsorship deals. 
• Some top Pinterest influencers make more money on Instagram where they have much smaller followings, they told Business Insider.
• We spoke to three influencers with a combined 15 million followers — Keiko Lynn, Erica Chan Coffman, and Jan Halvarson — on how they make money from the social platform.
• Visit Business Insider's homepage for more stories.

Keiko Lynn, a personal style and lifestyle blogger, is one of Pinterest's biggest stars and gets more than a million monthly viewers on the platform.

But advertisers care more about reaching her fans on Instagram and her blog, KeikoLynn.com, than the board-based social platform.

"It's usually a secondary ask from brands," Lynn told Business Insider. "I think it's underutilized because I have such a huge amount of eyes on my Pinterest."

When marketers do request sponsored pins, it's often part of a larger package deal, Lynn said. A typical sponsorship package includes one Instagram post, two to three frames on Instagram Stories, a blog post, and a dedicated pin on Pinterest.

Lynn, who's represented by the social influencer marketing agency Digital Brands Architects (DBA), is not alone in struggling to sell Pinterest as a standalone channel.

Pinterest influencers Erica Chan Coffman and Jan Halvarson, who each have millions of followers, said the platform has best served their businesses indirectly through traffic referrals.

"Soon after Pinterest launched, it quickly became obvious that it was the top driver of traffic to my blog," said Coffman, executive editor at HonestlyWTF. Coffman, who has 6.2 million followers on Pinterest, includes sponsored pins in contracts with large brands.

But she says most of her direct income comes from Instagram and her blog. Even though she has nearly 50 times more followers on Pinterest than Instagram, Coffman is able to charge more for Instagram posts and Stories.

"I make most of my income from blog posts and brand partnerships on my blog," she said. "Social media is definitely secondary. The fact that I can keep my traffic numbers high thanks to a lot of traffic drivers like Pinterest is hugely beneficial for my overall business strategy."

Read the full breakdown of how much money these influencers charge for sponsored pins on Business Insider Prime.

Join the conversation about this story »

NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

Is it too late to say "new year, new you"?

We are, after all, in a new year. A new decade even, as you might've heard.

This is Drake Baer, writing in lieu of executive editor Matt Turner, who's on parental leave. I run the strategy desk at Business Insider, where we cover how the professional world is shifting and how to navigate it. We have a vested interest in reinvention, one that you can follow through our weekly newsletter, Success Insider. And if you're interested in renewables, check out Power Line— our just-launched newsletter covering clean energy.

Over the past week, the Business Insider newsroom has had a variety of pieces that will help you plan out the year, and maybe the decade. Perhaps you want to finally get going in real estate, or you're curious about cannabis, or you keep hearing about the social reselling platforms where the kids are getting all their fashion. Or maybe, simply, you want to get stock picks from the highest-performing analysts around. We got you.

You want to get ahead. We'll show you how.

Finance and investing

Here's a look at how SoftBank's dot-com-era investments played out — half of these 14 startups it bet on collapsed

The Japanese conglomerate SoftBank quickly went from being lauded to scrutinized with the fallout of WeWork. But as our reporters uncovered, the house that Masayoshi Son built (like many investors) has a history of calamity. The first megafund, SoftBank Capital Partners, surfed on the dot-com boom at the turn of the last century — and a frankly shocking number of those would-be world-beaters went belly up.

A Silicon Valley tech leader left behind a lucrative career to pursue real-estate investing. Here's the dealmaking strategy that's netted him 3,500 units to date.

Having burned out on the startup grind, Spencer Hilligoss wanted to find a way to financial independence that would be predictable and lucrative. He learned that "syndication" was the best strategy for making smart investments in real estate — with a healthy dose of scale.

'This is a really huge buy signal': Billionaire bond King Jeffrey Gundlach lays out a juicy investment setup worth seizing, one that's happened only a handful of times in the past century

Gundlach is a superstar among finance types, known for his bold calls. And he has two interrelated messages: The US dollar is about to get way weaker and commodities are apt to swell in turn.

Wall Street's 5 most accurate analysts reveal the stocks you should buy now for explosive returns in 2020

The fintech firm TipRanks measure how well sell-side analysts perform, and they gave us the top experts of past year with one stock each analyst rates as a buy. Why not learn from the best?

The top 14 VC firms making deals in the cannabis industry, and where they're looking to place their next bets

The cannabis-investment space continues to mature, and our reporters Yeji Jesse Lee and Jeremy Berke caught up with some of the leading VCs, as measured by deal count, for their 2020 predictions.

WeWork convinced a skeptical SEC to let it use a wonky metric that tested accounting rules. Here are 58 pages of letters showing how the coworking company changed the agency's mind.

Dakin Campbell published 58 pages of letters between WeWork and the top U.S. securities regulator that have never been seen by the public. The back-and-forth shows how the company convinced the SEC to let it use a wonky metric that painted its financials in a rosy light when pitching its doomed IPO.

Tech, media, and telecoms

Internal Tesla marketing document reveals how the company tried to position itself as a lifestyle brand that makes the world's best cars

At Business Insider we pride ourselves in living up to our name — that is, bringing you inside the world's most influential companies. Reporter Patrick Coffee did just that on Wednesday with an article extrapolating from an internal document at Tesla that outlines the company's marketing strategy.

How much YouTube pays influencers for 100,000, 1 million, and 150 million views, according to top creators

YouTube has a partner program through which influencers can make money off placing ads in their videos. We spoke with a variety of influencers about how much they earn with each video — the pay (and the ads themselves) depend on their length, the demographic, and how long people are watching them.

Walmart wants to build an ad business that rivals Amazon. Here are the 11 execs leading the charge.

Amazon makes upward of $17 billion on advertising a year. Walmart is attempting to match that success, with a phalanx of executives with tenures at Frito-Lay, Facebook, and of course Amazon Advertising. Intriguingly, there are quite a few CBS veterans in the mix.

How Deloitte is spending $2 billion to train 4,000 workers on the hottest tech jobs of 2020

The reality of digital transformation mandates that large companies need to "upskill" their workforce — that is, provide their talent training that makes them freshly relevant as new skills become in demand. The professional services giant Deloitte founded its Cloud Institute last year, providing employees the chance to pursue technical roles in-house. A thousand people went through it last year, with quadruple the cohort in 2020.

Healthcare, retail, and transportation

Verily just presented for the first time at JPMorgan's big health conference. Here's how the CEO of Alphabet's life sciences firm laid out the unusual business to top investors.

Verily is one of the most intriguing names in health. Owned by Google parent Alphabet, the firm has taken on $1.8 billion in investments, and it's involved in projects ranging from addiction treatment to robotics. And in a presentation, CEO Andy Conrad unpacked how the firm isn't just working on a bunch of disparate initiatives, but a coherent strategy.

The argument over whether America is facing a 'truck-driver shortage' has embroiled the trucking industry for years. We asked 3 CEOs and 2 economists to settle the debate.

While trucking is a $800 billion industry, it's facing a labor problem. Trucking companies are seeing staggering rates of turnover — by one estimate, 97%! We spoke with trucking executives and economist about how they'd diagnose trucking's worker challenges, plus how to address it.

The ultimate guide to opening a Pure Barre franchise and becoming wildly successful, according to 2 multiple-franchise owners

Ballet, but make it boutique fitness. Pure Barre has over 500 studios across North America, serving more than half a million clients. The owners we spoke with detailed the challenges of starting up and dispensed sage advice on metrics and marketing.

McDonald's franchisees in leaked email call for the fast-food giant to 'stay focused' on creating a chicken sandwich that customers crave as the chain battles Popeyes and Chick-fil-A

Chicken's hot. Popeyes and Chick-fil-A have become pop-culture presences unto their own. And the golden arches want in on it, testing new sandwiches in Houston and Knoxville. "We need to stay focused on coming up with a chicken sandwich our customers are going to crave," so reads an internal email.

How entrepreneurs use apps like Poshmark to turn side hustles selling clothes into full-time gigs earning 6 figures or more

Online resale is also hot, especially with millennials and Gen Z. Poshmark is a social reseller with an emphasis on fashion, and our reporter Jennifer Ortakales spoke with a pair of "poshers" about how they grew their platforms from side hustles into full-time businesses. One key strategy: The social nature of Poshmark creates a built-in marketing mechanism. A quarter-million followers goes a long way.

SEE ALSO: Portugal is the best country in the world for American expats to retire in. A Utah couple who moved there in 2012 gave us a breakdown of how they live on a $2,330 monthly budget.

Join the conversation about this story »

NOW WATCH: WeWork went from a $47 billion valuation to a failed IPO. Here's how the company makes money.

• DTC investors see huge opportunity in companies with a health and wellness bent, like 8Greens, Daily Harvest, Kin Euphorics, and Talea Beer.
• People are increasingly health-conscious and seeking beverages with benefits, said investors from Forerunner Ventures, Torch Capital, and others.
• The investors have also been encouraged by high-profile exits in these categories and a decline in alcohol consumption.
• Click here for more BI Prime stories.

Despite WeWork's implosion and newly listed public companies including Uber and Lyft underperforming in 2019, venture capitalists will pump nearly $100 billion into startups in 2020. Some of it is going to direct-to-consumer startups in categories from alcohol to beauty to home security.

DTC investors from Forerunner Ventures, Torch Capital, and others told Business Insider they especially see huge opportunity in companies with a health and wellness bent, like 8Greens, Daily Harvest, Kin Euphorics, and Talea Beer.

We asked five investors why health and wellness are hot categories and which companies they're betting on.

People are becoming more proactive about their health 

Kirsten Green, a founding partner at Forerunner Ventures, said she's backing Oura, which makes rings that track health and sleep, because people are getting increasingly health-conscious and incumbent companies have been slow to catch up.

She said Oura meets this pent-up demand, provides a utility, and is less bulky and easier to use than other fitness trackers. She thinks Oura could become a hub for all things sleep.

"As people become more proactive about their own health, there is considerable opportunity to introduce new products, services, and ways of conducting business," she said.

There is a new market for health and wellness brands

Health and wellness startups are catering to a new audience, said Neda Daneshzadeh, a partner at Prelude Growth Partners, which has invested in food startups including chickpea pasta maker Banza and plant-based supplement company 8Greens.

"They really care about what they put in their bodies, on their bodies and how they strengthen their bodies," she said of that audience.

Products that are easy, convenient and affordable will succeed, she said.

Investors are attracted to convenience

M13's cofounder Courtney Reum said investors are drawn to food and beverage startups that promise convenience.

"Whether it's 8Greens offering veggies in effervescent tablets or Daily Harvest's quick meal-replacement smoothies and bowls, it's about the form factor and efficacy of convenience," he said. "Beverage startups today check all the boxes."

People are drinking less alcohol 

Factors fueling new beverages are the decline in alcohol consumption, the growing popularity of spiked seltzer, non-alcoholic beverages, and interest in sobriety, said Byron Ling, a partner at Canaan Ventures.

"You can see a really strong shift in consumption patterns, and a continually accelerating decline of people drinking alcohol," he said. "It's super clear that consumers are clamoring for new and more modern ingredient profiles, and products that deliver on a function versus a lifestyle."

The global beverage market is expected to reach $1.8 trillion in market size by 2024, and it's led by upstarts, not the big conglomerates, he said.

There have been high-profile exits

High-profile beverage exits in recent years have sparked interest in the category, said Torch Capital's Jon Keidan, pointing to Nestle's acquisition of Blue Bottle Coffee and Coca-Cola's acquisition of Honest Tea.

"Food and beverage typically saw late-stage investments, but these success stories have meant that investors are beginning to invest a lot earlier," he said.

SEE ALSO: Investors from the DTX Company, Forerunner, Greycroft, and others name 16 direct-to-consumer startups that will take off in 2020

Join the conversation about this story »

NOW WATCH: How to find water when you're stuck in the desert

• WPP, the world's largest ad holding company, has struggled to keep up as advertisers overwhelmingly shift their spending into digital.
• In a presentation to investors Jan. 15, WPP CEO Mark Read and other executives laid out their plans to turn the company around.
• Read plans to continue consolidating ad agencies while deepening WPP's business relationships with tech companies like Google, Facebook, Microsoft, and Amazon.
• Click here for more BI Prime stories.

The holding companies that have dominated the multi-billion-dollar global advertising business for decades are under attack from all sides as clients demand more for their money and shift spending to platforms like Facebook, Amazon, and Google, whose plans to kill third-party tracking cookies in two years will curtail advertisers' targeting abilities.

WPP, the largest of those holding companies, is one year into a 3-year turnaround plan. CEO Mark Read briefed investors and analysts at its London headquarters Jan. 15, showing a deck detailing steps he has taken to address these changes as well as new initiatives and plans for the year to come.

Analysts issued mixed reactions after the presentation. Morningstar said its overall outlook on WPP remained positive. Bank of America downgraded its rating to "underperform."

A WPP spokesperson declined to comment.

SEE ALSO: These 5 trends defined a turbulent 2019 at the advertising giant WPP, which consolidated as clients slashed budgets

The primary theme of the presentation is the merger of technology and creativity, supported by consumer data.

WPP also hinted that it plans more integration of its massive network.

Last year, WPP continued to consolidate, and the presentation characterized the mega-mergers of VML and Y&R and Wunderman and JWT as successes, hinting that Read plans to continue the strategy.

This past week, WPP announced that it will combine media buying agency Mindshare with Neo Media World, a performance marketing firm.

WPP said it’s working to reduce its reliance on Google and Facebook by drawing from sources like Amazon, Microsoft, LinkedIn, and IBM.

WPP said it has "preferential access" to assets from these businesses as well as Kantar.

WPP plans to integrate AI, voice, esports, and AR capabilities with Adobe, Microsoft, Facebook, Amazon, and Snap, among others.

Read has acknowledged that creativity is a weak spot for WPP, especially in North America — a point reinforced by a wave of layoffs that hit one of its largest agencies, Ogilvy, this past week. WPP also said it planned to name leaders to oversee its relationships with each of the major platforms.

WPP downplayed recent account losses and showcased transformation services.

WPP downplayed the late 2018 loss of lead global creative duties for Ford (it kept the more lucrative media buying and strategy business) by explaining how it designed the car maker's FordPass app.

WPP announced the launch of a new, internal tech platform called WPP Open that promises to make the company's tech capabilities available to all of its agencies in one place.

WPP said the new platform would consolidate apps, consumer databases, content creation programs, and other tools from WPP companies and third parties.

As evidence of its success, WPP listed the tech giants among its largest clients, with Google at number two.

• Experts say that delivery companies and restaurant chains will need to grapple with the question of how to deal with delivery in 2020. 
• The cost of delivery is increasingly being passed on to the customer, in the form of higher delivery fees and more expensive menu items. 
• Meanwhile, workers say they are in "tablet hell," juggling work with multiple delivery services in addition to traditional orders. 
• Visit Business Insider's homepage for more stories.

Restaurants are delivering more food than ever before. By 2022, food delivery is set to become a $75.9 billion business, more than triple the $23.2 billion recorded in delivery sales in 2011, according to a 2018 Cowen & Company report.

Business is booming. And, it is creating some massive problems. 

"Delivery is still a mess," Fred LeFranc, the CEO of the restaurant-industry consulting firm Results Thru Strategy, recently told Business Insider. 

LeFranc said that 2020 needs to be the year that restaurants sort out their delivery strategy. Currently, he said, delivery is getting the most attention as a growth channel in the restaurant industry, even though it accounts for a relatively small proportion of sales. 

While chains like Chipotle and McDonald's have been happy to report double and triple digit increases in delivery sales, a reckoning seems to be set for 2020. 

"The restaurants are in pain because they have incremental revenue, but not incremental profits," LeFranc said. "The delivery companies are beginning to shake down." 

Delivery companies are feeling the pressure to boost profits, Fortune reports. Grubhub's stock fell by more than 30% over the course of 2019. Uber Eats is exiting certain markets, while Postmates delayed its plans for an IPO in October. 

Meanwhile, chains are getting sick of the fees charged by delivery partners, with The Wall Street Journal reporting in June that many were renegotiating deals.

The era of exclusive partnerships seems to be over, as chains increasingly announce deals with various delivery companies.

McDonald's, which originally partnered exclusively with Uber Eats in 2017, announced partnerships with DoorDash and Grubhub this year. According to a source with knowledge of the situation, the company plans to expand its Grubhub partnership nationally in the near future, and a yet-to-be announced partnership with Postmates is in the works. 

A McDonald's representative told Business Insider that only DoorDash and Uber Eats were national delivery partners, and they declined to confirm other information about the chain's delivery service. 

"We're excited to be partnering with a brand like McDonald's and are happy about our results thus far in New York," a Grubhub representative told Business Insider in an email. "We're looking forward to what the future will bring."

The most fundamental problem is that the current economics of delivery are "not sustainable," according to LeFranc. Currently, most restaurants or delivery partners subsidize delivery. Having food delivered simply costs more — and it may be time for customers to start paying more for the convenience. 

Brace yourself to pay more for delivery in 2020

Delivery is an expensive proposition. Drivers need to be paid, and third-party delivery providers — which charge restaurants a commission typically based on order cost — need to cover other operating costs. 

LeFranc says that a significant portion of delivery companies are eating the cost of delivery, "propped up by P.E. groups," or private-equity investors willing to allow companies to forego profitability for growth or longer-term profits. For example, in October, Grubhub — the only major delivery player that is profitable — wrote in a letter to shareholders that it does not believe a company can "generate significant profits on just the logistics component of the business." 

"Bottom line is that you need to pay someone enough money to drive to the restaurant, pick up food and drive it to a diner," the letter reads. "That takes time and drivers need to be appropriately paid for their time or they will find another opportunity. At some point, delivery drones and robots may reduce the cost of fulfillment, but it will be a long time before the capital costs and ongoing operating expenses are less than the cost of paying someone for 30-45 minutes of their time."

Bart Shuldman, the CEO of TransAct, which has a back-of-house automation service called Boha, said that sorting out delivery would be the top challenge for the restaurant industry in 2020. 

"I think it's a necessary evil. The millennials love it," Shuldman said. "So, you've got to figure it out. I think eventually the customer is going to pay."

As the economics of delivery shift, restaurants are beginning to ask customers to pay more. That doesn't mean simply charging or increasing delivery fees — it could also mean listing higher prices on online menus than customers would find in stores. 

"For a long time, [third-party delivery] marketplaces were saying, you must charge what you charge in the restaurant on your marketplace version of the menu," Jonah Glass, CEO of Olo, said on a panel at the ICR Conference in Orlando, Florida, this week. "What's changed is now you see brands charging more through the marketplace. They're charging more through direct [delivery] channels than the ordinary store."

"I think that's important, because I think the commissions are not just because someone is greedy and charging too much," Glass continued. "It's a really high cost of doing delivery, and doing it at a high quality. So, that has to be offset by somebody paying more. I think more and more brands are offsetting that cost of delivery to the consumer, and the consumer is willing to pay." 

Companies are also looking towards channels outside of delivery for profitability.

In the October letter, Grubhub emphasized its abilities as an online advertising partner— not just a delivery service. Hudson Riehle, senior vice president of the research and knowledge group for the National Restaurant Association, said on the ICR panel this week that the industry's "new frontier" would be partnering with other industries, such as bundling streaming services and meal delivery. 

Workers are in 'tablet hell'

As industry insiders attempt to balance costs between customers, restaurants, and delivery companies, workers are dealing with the consequences in stores. 

With more delivery partners to work with, employees say they've been thrust into what has been deemed "tablet hell." Workers are juggling multiple tablets to handle delivery, in addition to even more tablets to deal with matters from walk-in freezer temperatures to scheduling workers' hours. One McDonald's employees said that, in addition to tablets, stores were given Bose speakers to facilitate the Uber Eats partnership — many of which were promptly stolen. (McDonald's declined to comment on the claim.) 

Part of the solution is turning to partners that streamline the process. Tech companies like Cuboh and Olo work to integrate different partners and manage the various systems.  

Some companies are getting more creative in dealing with tablet hell. McDonald's is testing a "McDelivery Center" that is intended to hold tablets from various delivery services that work with the chain, according to leaked documents obtained by Business Insider. 

"We're proud of the technologies we are bringing to restaurants as part of our continued focus on innovation," a McDonald's representative told Business Insider. "Our goal with the 'McDelivery Center,' as an example, is to continue to improve the delivery process for restaurant crew, couriers and customers."

Delivery is huge, but it's also messy, both physically and economically. In 2020, restaurant chains will be attacking that messiness more than ever before. 

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SEE ALSO: Shake Shack has rolled out a 4-day workweek at dozens of locations, as the CEO says it's 'never been harder' to attract and retain workers

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NOW WATCH: We went to a Champagne vineyard in France to find out why it's so expensive

• Some creators on YouTube have techniques they use to maximize how much money they earn off a single video.
• Shelby Church, who has 1.4 million subscribers, said she earned more than twice as much money in 2019 from YouTube ads than in 2018 by extending her videos to over 10 minutes long. 
• This is a common strategy among creators, and works because it allows them to include more ads in their videos to help boost their earnings.
• Click here for more BI Prime stories.

After talking with friends on the platform, YouTube star Shelby Church (1.4 million subscribers) realized she could be earning a lot more money off her videos.

She told Business Insider that in mid 2019, she learned that by simply extending her videos to over 10 minutes long, she could double the revenue she was making from Google-placed ads.

Church earns a big portion of her revenue directly from the platform this way, and by promoting brands on her channel and Instagram page.

YouTube allows creators with 1,000 subscribers and 4,000 watch hours to monetize their channels with ads placed by Google. How much money a creator earns (known as AdSense revenue) depends on the video's watch time, length, video type, and viewer demographics— among other factors.

How Church doubled her YouTube revenue by extending the length of her videos to over 10 minutes long

One common technique creators on YouTube employ as a way to earn more money is making their videos longer so they can contain more ads.

Why does this work? 

A video over 10 minutes long can contain multiple ad options, like one pre-roll ad, multiple mid-roll ads, and a post-roll ad that plays at the end of a video. 

In 2018, most of the videos that Church uploaded were under 10 minutes long, she said. Since they were shorter, she was only able to include one ad. 

Midway through 2019, she began to extend the length of her videos, and by the end of the year, she had made double the money from AdSense that she made in 2019.

Other creators like entrepreneur Kevin David (who has 838,000 subscribers on YouTube) and Marina Mogilko (1.7 million subscribers) told Business Insider that they use this strategy as well. They also create videos focused on viewers who are more valuable to advertisers.

Church said now her videos are typically about 10 to 12 minutes. She'll usually include one pre-roll ad before the video (which is the default on YouTube), and two ads within the video, three or four minutes apart. 

She found that in 2019, her videos over 10 minutes long generally made around $5.00 per 1,000 views, while the videos under 10 minutes usually made around $2.00 per 1,000 views. Church said in her experience, YouTube takes about half of that.

For more on Church's YouTube business and how much money she makes, check out these posts on Business Insider Prime: 

• How much money Church earned on YouTube in 2019: Here's how much money she earned in 2019 from Google AdSense.
• How much YouTube paid her for a video with 1 million views: Church broke down how much YouTube pays creators for views.
• How much she earned on a single video with 4 million views: She also shared how much she earned on her most-viewed video, which went viral in 2019.

Sign up for Business Insider's influencer newsletter, Influencer Dashboard, to get more stories like this in your inbox.

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NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

• McDonald's, Burger King, Wendy's, and Old Navy all have verified accounts on TikTok.
• With 127,000 followers, Walmart is particularly active on the app.
• Posts tagging its hashtag challenges, like #DealDropDance and #SavingShuffle, have garnered billions of views on the social media platform.
• Here's how Walmart is using a thriving TikTok account to resonate with a younger set of consumers, particularly Gen Z.
• Visit Business Insider's homepage for more stories.

Walmart joining TikTok might just be the crossover event of the century.

And yet, the almost 60-year-old retailer is surprisingly active on the social media platform that has gained explosive popularity among young people, especially Gen Z. Walmart's verified account, which posted for the first time in September, already has 127,000 followers and has garnered millions of views on its posts and hashtag campaigns.

"We are really in the test and learn phase," Walmart's US senior director of social media, Jodi Durkin, wrote in an email to Business Insider. "Someone has a good idea, we try it and see what happens."

Walmart's TikTok has already seen viral success

One of Walmart's first TikTok posts, which showed an employee poking fun at the VSCO girl trend, achieved viral fame. The post has some 2.8 million views and more than 553,000 likes.

Another huge success for Walmart's TikTok has been the company's dance-focused challenges, which are generally associated with a hashtag. Walmart's #DealDropDance and #SavingShuffle hashtags have generated 3.8 billion views and 1.7 billion views, respectively.

To Durkin and the rest of Walmart's social media team, this overwhelming response has been a pleasant surprise. 

"Going into it, we knew from observing that music and dance are passion points for people on TikTok," Durkin wrote. She explained that the TikTok team focuses on featuring these elements in their posts in order to engage with customers.

The Walmart TikTok team is small 

In addition to Durkin, the people behind Walmart's TikTok account are mostly millennials who represent diverse gender identities and work in the Hoboken, New Jersey, or Bentonville, Arkansas, offices.

"The team is pretty small and known for its scrappiness," Durkin wrote. As the for the people in the videos, Durkin confirmed that they are real Walmart employees, mostly from stores in the Bentonville and Hoboken areas.

"We know the people who work in our stores are beloved members of their local communities," Durkin wrote. "So whenever we can, we want these associates to be the stars of the show."

Durkin said Walmart's social media team had been studying TikTok for some time before launching the account, taking note of trends and opportunities for engagement. After the VSCO girl post went viral, the team was encouraged to keep moving forward. 

"Now we are testing and learning different types of videos to see what TikTok users love," Durkin said.

Winning over Gen Z

TikTok is popular among Gen Z, a budding class of consumers that many retailers are looking to win over. With the large Gen Z audience on TikTok, it's no surprise that other brands and retailers are taking advantage of the platform to reach more shoppers. 

McDonald's has a verified TikTok account with almost 20,000 followers, but no posts. Burger King, Wendy's, and Old Navy also have verified accounts with posts that have racked up thousands of views.

"Brands really showing up like your friend and being a part of the conversation is critical for building that relationship with that Gen Z shopper," Instagram Shopping's product lead, Layla Amjadi, said at Business Insider's IGNITION: Redefining Retail conference in New York City on Tuesday.

Gen Z loves to see a brand engaging with culture in real time, Amjadi said. And that real-time engagement is what TikTok is all about.

"We do have tools we use to see what things are trending on a daily basis on TikTok and the internet, and we try to work those things into the content we make," Durkin said of Walmart's posting strategy.

Perhaps most importantly, Walmart's TikTok success is helping Durkin and her team to learn more about how younger people engage with the superstore. 

"What we have always loved about social is that it's a chance to engage with customers," Durkin wrote. "Our reasons for joining TikTok are the same, it unlocks news ways for us to have fun with our customers celebrating seasons and fun merchandise with them."

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SEE ALSO: TikTok is fueling the viral success of a toy capsule with tiny versions of everyday household brands — and they're selling out in stores and online

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NOW WATCH: These melons can sell for as much as $22,500 each in Japan

• Bloomberg LP's Bloomberg Media is launching a new brand that aims to be the "definitive" source on capitalism and climate change.
• Bloomberg Green went live January 21 and is the company's biggest editorial initiative of recent years with a digital, print, podcast, events, and broadcast presence.
• Bloomberg claims its huge newsroom and data resources make its initiative more significant than what other news outlets are doing.
• The new brand aligns with founder and presidential candidate Mike Bloomberg's longstanding interest in climate change.
• Click here for more BI Prime stories.

Bloomberg Media, the news arm of financial news and information giant Bloomberg LP, is launching a new brand, Bloomberg Green, that aims to be the "definitive" source of capitalism and climate change news and information.

Bloomberg Green is internally considered the biggest editorial initiative since it launched Twitter news broadcast TicToc, now QuickTake, at the end of 2017 with a team of about 40 people.

Bloomberg Green went live January 21 and will span a website, a twice-yearly magazine, an email newsletter, a podcast, a broadcast presence, and events, starting with a January 22 one at the World Economic Forum in Davos.

Bloomberg execs wouldn't say how many people are dedicated to the project, but this is the first time it has centralized the coverage under one team. Late last year it was advertising for at least seven journalists to grow its coverage in this area.

It's also lined up marquee  sponsors in Amazon, HP Inc., JLL, Tiffany & Co., and PGIM that committed to support Bloomberg Green for its first year.

"It's a strong investment editorially," said Julia Beizer, chief product officer at Bloomberg Media Group.

Bloomberg claims its effort will be more significant than what rivals are doing

Media interest in covering climate change has been on the rise, but Bloomberg execs claim they are giving climate change a sustained focus that's unmatched by any other newsroom. 

That's because Bloomberg has the ability to draw on its newsroom of 2,700 people, and a ton of financial data. A key feature of Bloomberg Green is a dashboard containing several climate metrics like how many trees are being lost over time and the quantity of greenhouse gasses being emitted.

"By taking what we do, we could become the definitive platform for capitalism and climate change," said Aaron Rutkoff, the editor of Bloomberg Green. "I want to make very plain, this cuts across the Bloomberg newsroom."

It's significant that an outlet like Bloomberg, with its legitimacy in the business community, is expanding climate change coverage, said Kyle Pope, editor and publisher of Columbia Journalism Review, and a founder of Covering Climate Now, an effort to get more media covering the subject.

Mike Bloomberg is also focused on climate change but the company said its coverage of the subject is unrelated

The project also aligns with a longstanding interest of Bloomberg's founder and owner, and now presidential candidate, Mike Bloomberg.

With Carl Pope, he wrote "Climate of Hope," a book about dealing with climate change. His philanthropic arm, Bloomberg Philanthropies, in June launched a $500 million campaign called Beyond Carbon to take on climate change.

Bloomberg News has said it will continue to keep its distance from covering its founder's presidential campaign, a stance that's had mixed reaction from the newsroom.

And with Bloomberg Green, Bloomberg execs are quick to emphasize that Mike Bloomberg had no involvement in the project, saying Bloomberg News editor in chief John Micklethwait came up with the idea in March, long before Mike Bloomberg announced his presidential run.

"John Micklethwait came up with it very early," Rutkoff said. "His sense was that there was an opening to tell stories about the intersection of capitalism and climate change."

In a memo to news staff in September, Micklethwait listed environmental and climate coverage as key areas of opportunity to expand its coverage, saying they were of growing concern to clients of Bloomberg LP's core terminal business, which is aimed at Wall Street professionals.

Bloomberg has laid the groundwork for climate change coverage for a few years. It owns the Twitter handle @climate, and already produces Climate Changed, an editorial section on Bloomberg.com.

Bloomberg Green is also seen as a way to bolster the value of Bloomberg's digital subscription, which it launched a couple years ago.

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NOW WATCH: Behind the scenes with Shepard Smith — the Fox News star who just announced his resignation from the network

• Kevin Fredericks and Anthony Belcher Jr. host a podcast where they discuss topics like entertainment news, but when they first launched it, they didn't know it could turn a significant profit.
• After Belcher quit his job as an Uber driver, he and Fredericks started a Patreon page for the show and developed a strategy to encourage subscriptions.
• Now they can make as much as $25,000 a month from Patreon, with thousands of fans contributing anywhere from $5 to $60. 
• Click here for more BI Prime articles.

Anthony Belcher Jr. — also known as DoBoy from Nick Cannon's long-running comedy show, "Wild 'N Out"— took a gamble on his podcast "Righteous and Ratchet," which he cohosts with fellow stand-up comedian and entrepreneur Kevin Fredericks.

The podcasting duo launched the show in December 2018, relying on back-and-forth banter to keep listeners engaged in conversation topics from French fries to Kevin Hart.

But when Belcher quit his job as an Uber driver right around the time of the launch, he and Fredericks knew the podcast had to be more than relatable. Fredericks runs his own influencer business and YouTube channel with over 600,000 subscribers, but for Belcher, the podcast would become his main source of income.

"Righteous and Ratchet" lives on YouTube as well as podcast platforms, so it generated some revenue from YouTube AdSense and ads sold by podcast distribution company, AudioBoom. But the show wasn't making much money until Fredericks and Belcher took it to Patreon.

Patreon is a membership platform where creators post content for fans with subscriptions, and for the past few years, the service has become increasingly popular for podcasters in particular.

Podcasts make up the second biggest vertical on the site, said Janet Lee, Patreon's creator partnerships lead for podcasts. Podcast users on the site have quadrupled over the past three years, Lee said, and the revenue they generate for Patreon has increased eightfold in that time.

"The podcast fan is a very unique sort of fan," Lee said. "That's why we've seen so much organic growth on Patreon with podcasters."

'Righteous and Ratchet' hosts follow 3 rules to encourage growth on Patreon

By February 2019, two months after its launch, "Righteous and Ratchet" had established a presence on Patreon. For the first few months, the hosts earned a modest income — about $2,000 at most — and Fredericks insisted Belcher keep it all since he recently stopped driving for Uber. 

Then, around April or May, they reevaluated their fundraising strategy.

"That was the thing that changed everything for us," Belcher said.

Instead of trying to convince a small segment of their most dedicated fans to donate $10 or $25, they decided to try to make Patreon membership a necessity for all of their listeners at $5 a month, which is now their most popular monthly contribution tier.

"Our whole formula is early, extra, and exclusive," Fredericks said.

Patrons get to watch the main weekly episode in video format a day or two before it goes live on podcast platforms, they get access to an extra bonus episode that can only be unlocked on Patreon, and they hear exclusive takes that the hosts don't share on widely distributed episodes. 

"Sometimes we'll have conversations on the bonus episode that are a little more free because we know it's not going to be posted publicly," Fredericks said. For instance, he and Belcher try to avoid saying too much about entertainment industry drama in order to leave room for future collaborations. 

Listeners mobilized to support the show, with some donating up to $60 a month

Early, extra, and exclusive content encouraged a spike in $5 donations, and $5 a month from thousands of patrons adds up. Once the majority of their fans started seeing paywalled content as a necessity, the podcast went from earning a few thousand dollars a month to as much as $25,000. 

Podcasters like Hannah Maguire and Suruthi Bala of London-based true crime show "RedHanded" also rely on Patreon to generate more than $14,000 a month, and tabletop role playing podcast "Friends at the Table" earns almost $22,000 per month.

When big Patreon deposits first started to hit his bank account, Belcher was in disbelief.

"It was right around the second or third month when that deposit came in that I was like, 'Oh, this is real,'" Belcher said. "Patreon has me making more money now than I've ever made in my life. It's literally changed my tax bracket."

Fredericks, who was already earning ad income from YouTube and other social-media channels, said Patreon also made a difference in his finances.

He and Belcher upgraded their microphones and other studio equipment, and were even able to invest in office space.

"Patreon is very consistent income," Fredericks said. "With YouTube, you can have high months and down months, but Patreon has been pretty consistent over the past eight months. It's life-changing."

SEE ALSO: How a podcaster made nearly $20,000 in 3 months by trying programmatic ad sales after years of making hardly any money

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NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

• The Shorty Awards honor the best of social media, from people to organizations, and this year's list of nominees includes YouTube influencer Jeffree Star, actress Sophie Turner, and the internet's favorite GIFs, like Baby Yoda Sipping Tea. 
• New to this year's nominees: TikTok creators are nominated for categories other than "TikTokker of the Year," which shows the rise of the platform. 
• Check out the full list of nominees for the 12th annual Shorty Awards, which will be presented May 3 in New York City at 1515 Broadway Theater.
• Click here for more BI Prime stories.

The nominees list for the 12th annual Shorty Awards is officially out.

The Shorty Awards honor the best of social media, from people to organizations. This year's list of nominees include YouTube sensation Jeffree Star (17 million subscribers), Game of Thrones actress Sophie Turner, and the Baby Yoda Sipping Tea GIF. 

New to this year's list: There are several TikTok stars nominated within categories like Food & Drink, Meme of the Year, Weird, and Beauty. This is the first year TikTok creators are nominated  in categories other than "TikTokker of the Year," which is due to the number of viral trends, challenges, and crazes that spawned from TikTok and dominated social media in 2019.

The finalists are determined both by rankings from The Real Time Academy and public votes. Fans can vote online, once a day, per influencer, on the Shorty Awards website, and they can add an additional vote by sharing on Twitter and Facebook through the site, until voting closes.

The 12th Annual Shorty Awards will be held in New York City at 1515 Broadway Theater, and will be presented May 3, with live-streaming coverage at ShortyAwards.com.

Here are the 2020 Shorty Award nominees: 

For more on the nominees, check out these posts on Business Insider Prime: 

• YouTube creator Jennelle Eliana has posted only 3 videos and already has 1.5 million subscribers. She told us how it happened.
• How YouTube star MrBeast, who has 22 million subscribers, uses keywords and the 'shock and awe' effect to maximize views.

Sign up for Business Insider's influencer newsletter, Influencer Dashboard, to get more stories like this in your inbox.

Actor (Arts & Entertainment)

Angela Bassett

Barbie Ferrierra

Bex Taylor-Klaus

Billy Porter

Brie Larson

Hunter Schafer

Jason Statham

Jharrel Jerome

Naomi Scott

Rebel Wilson

Sophie Turner

Topher Grace

Celebrity (Arts & Entertainment)

Adam Sandler

Beyoncé

Blake Griffin

David Beckham

Demi Lovato

Jonathan Van Ness

Keke Palmer

Michael Strahan

Jennifer Aniston

Paula Abdul

Tessa Thompson

Zendaya

Comedy (Arts & Entertainment)

Aidy Bryant

Arturo Castro

Lamorne Morris

Trevor Wallace

Nasim Pedrad

Nicole Byer

Nikki Glaser

Randall Park

Ramy Youssef

Trevor Noah

Wanda Sykes

Whitney Cummings

Dance (Arts & Entertainment)

Benny The Bull

DexRated

Ghetto Spiderman

Harper Watters

Izzy and Easton

JenyBSG

King's United

Nappy Tabs

Phil Wright

Salif Gueye

Sherrie Silver

Team Naach

Music (Arts & Entertainment)

AJR

Anderson.Paak

Billie Eilish

Brandi Carlile

J Balvin

Blanco Brown

Lil Nas X

Lizzo

Missy Elliott

Mike Posner

Celine Dion

TWICE

Sports (Arts & Entertainment)

Alex Rodriguez

Allyson Felix

Amanda Nunes

Andy Ruiz

Cathy Engelbert

Coco Gauff

Russell Westbrook

Kliff Kingsbury

Megan Rapinoe

Morgan Hurd

Simone Manuel

Zion Williamson

Instagrammer of the Year (Team Internet)

Adam Waheed

Daniel Russia + Anna Devis

Ellen Sheidlin

Florence Given

Gab Bois

Kevin B Parry

Laetitia KY

Nicole McLaughlin

Poorly Drawn Lines

Strange Planet

Wolfgang

World Record Egg

Twitch Streamer of the Year (Team Internet)

AnneMunition

Annoying

dakotaz

EeveeA_

Fem Steph

LilyPichu

Loeya

Maria Lopez

MrFreshAsian

NickMercs

DeeJayKnight

XChochBars

Tik-Toker of the Year (Team Internet)

Avani Gregg

Brittany_Broski

Emmy

Glitters and Lazers

JonathanBlogs

Just Sul

Mahogany

OfficialHowieMandel

ohnoitsdapopo

Sammie

theewilliam45

Tmdad14

YouTube Comedian (Team Internet)

Alexa Rivera

Anna Akana

CalebCity

Eddy Burback

Kiera Bridget

Kevon Stage

Kyle Exum

Lenarr Young

Morgan Adams

Not Even Emily

Sarah Schaur

Scott Cramer

YouTube Ensemble (Team Internet)

Beta Squad

Dope or Nope

Dwayne N Jazz

F2Freestylers

Kian and JC

Lele Pons and Twan Kuyper

Montoya Twinz

Sam and Colby

Squirmy and Grubs

The Skin Deep

This is L&S

YouTwoTV

YouTube Musician (Team Internet)

BlackGryph0n

Catie Turner

Connie Talbot

DSharp

Einer Bankz

Kid Travis

LLusion

Nahre Sol

Pomplamoose

Sam Tsui

SethEverman

Tash Sultana

Breakout YouTuber (Team Internet)

DeJesus Custom Footwear

Gavin Magnus

Jennelle Eliana

Jimmy Butler

Jordyn Woods

Lily Chee

Magnet World

Niko Omilana

Noah Schnapp

Rey Rahimi

Supercar Blondie

Talia Mar

YouTuber of the Year (Team Internet)

Andymation

ContraPoints

Eugenia Cooney

Jarvis Johnson

Jeffree Star

Kayla Nicole

Mr. Beast

NikkieTutorials

Psych IRL

Roxxsaurus

Vareena Sayed

Wengie

Animal (Creative & Media)

Alfie the Alpaca

Hamilton the Hipster Cat

Prissy_Pig

Henry Tortoise

MacGyver the Lizard

MAYA THE SAMOYED

Pizzatoru

Puddin

Reagandoodle

Tito the Raccoon

Venus the Two Face Cat

Waffles the Cat

Art (Creative & Media)

Adam Hillman

Cécile Dormeau

Cindy Sherman

Dave Pollot

David LaChapelle

Mike Bennett Art

Odeith

Pablo Rochat

Paper Boyo

Positively Present

Samantha Rothenberg

strawberrypuffcake

Beauty (Creative & Media)

Cohl's World

Doni Darkowiz

Dulce Candy

Jessica Vu

Kheris Rogers

Learn with Lati

Leticia F Gomes

Makeup By Ariel

Nikita Dragun

Shalom Blac

Wayne Goss

xThuyLe

Lifestyle (Creative & Media)

Aaron Marino

Jose Zuniga

Draya Michele

Les Do Makeup

Matt D'Avella

Cherry Wallis

Color Me Courtney

Thomas Frank

Aja Dang

Kristen Johns

Raven Navera

Chachi Gonzales

House & Home (Creative & Media)

Andre Luis

Becki Owens

Bobby Berk

Em Henderson

Farah Merhi

Hilton Carter

Holly + Brad

Joanna Gaines

Jon Peters

Robeson Design

Ryan Serhant

Studio Mcgee

Food & Drink (Creative & Media)

Amirah Kassem

Bad Birdy

ErikTheElectric

Feed Your Girlfriend

Jessie Say Hey

Juns Kitchen

Matt Adlard

Naturally.Jo

One Meal A Day

Salt To Taste

Sam the Cooking Guy

Y.Na

Health & Wellness (Creative & Media)

Buttery Bros

Chloe Ting

David Goggins

Diary of a Fit Mommy

Dr Cody Hanish BS DC CCWP

Hellah Sidibe

The Sad Ghost Club

Megan Jayne Crabbe

Massy Arias

Remy Morimoto Park

Ron "Boss" Everline

Wheels2Walking

Journalist (Creative & Media)

Ben Smith

Caitlin Dickerson

Fareed Zakaria

Glenn Kessler

Hannah Reyes Morales

Jane Mayer

Jim Waterson

Jose Diaz-Balart

Mina Kimes

Mona Chalabi

Stephen A. Smith

Yamiche Alcindor

Meme/Parody Account (Creative & Media)

Captain Andrew Luck

Comments By Celebs

Cory Richardson

Death Star PR

Dilfs of DisneyLand

PigeonsDoingThings

Sarcastic Rover

Siduations

So Sad Today

sonny5ideup

Subway Creatures

Thoughts of a Dog

LGBTQ+ Account (Creative & Media)

Asia Kate Dillon

Dom and Nick

Edison Fan

Eduardo Sánchez-Ubanell

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• When Greg Auerbach and Nate Twer discovered they could earn a living from sponsored posts on TikTok, they refocused their video-production company from shooting local commercials to making videos for the app.
• Auerbach's TikTok account GregTube, which he launched in July, has 590,000 followers and 13.7 million likes.
• Auerbach said they still use professional lighting for all of their videos, but they've switched to using a smartphone to shoot scenes so that their posts feel native to the TikTok environment. 
• Click here for more BI Prime stories.

TikTok has ushered in a new generation of young stars, from a 16-year-old who dreams of making it in Hollywood to a college student who treats the app like a part-time job. And now older creators who fall outside Generation Z have started to gain followers and make money from the fast-growing social-video app too. 

Greg Auerbach, a 30-year-old video producer who lives in Philadelphia, decided to sign up for TikTok when he was having trouble sleeping one night.

"I was thinking about how all those guys, David Dobrik and Logan Paul, were all found on Vine and were able to make fun videos and obviously make money off of it," he said. "I looked up 'the new Vine,' and then TikTok pops up."

Auerbach created his account GregTube in July. It now has over half a million followers and more than 10 million likes. Most videos feature Auerbach and Nate Twer, his childhood friend and business partner, playing pranks on each other and splashing each other in the face with Double Gulp drinks. The channel feels a bit like "It's Always Sunny in Philadelphia" for the TikTok age.

While Auerbach's videos play for laughs, his TikTok account has quickly become a serious part of his business. 

Before joining the app, Auerbach and Twer earned most of their income by making professional videos for small businesses in Philadelphia. These shoots were time-intensive and often required hiring actors and a sound and lighting crew, he said. Now they get paid for sponsored posts on TikTok that they can produce in less than a day.

"We're able to storyboard and script a video, shoot it in my apartment with me and my buddy, and post it that day," he said. 

Auerbach charges advertisers differently based on their performance goals

Auerbach said he charges a flat $500 fee to cover production costs for a TikTok video and then a variable rate for views or app downloads depending on the brand they're working with.

Their CPM rate, cost per thousand views, varies, but they charged about a $1 CPM rate for a recent campaign, he said. All of their sponsored videos have millions of views on TikTok, with the largest receiving 16 million views. At a $1 CPM rate, a single video could generate up to $16,000 in revenue for the pair. Other sources interviewed by Business Insider have charged CPM rates as high as $10 for sponsored videos on TikTok, but a lot depends on the volume of views.

For app advertisers, Auerbach charges up to $5 per app download, he said. Because linking is still limited in TikTok posts, his partners have measured ad performance by tracking the relative increase in their average daily downloads after a GregTube video has gone live. Other creators on TikTok use referral codes to earn credit for app downloads in sponsored posts. 

Auerbach said he has looked into other ways to make money from the app, including livestreams and promoting music from new artists, but neither make sense for his channel right now. 

Auerbach avoids using a professional video camera for TikTok

When Auerbach and Twer first started posting on TikTok, they used professional cameras and video equipment designed for production shoots. They quickly switched to their smartphones after discovering it improved their videos' performance.

"We found out a lot of them didn't do as well because it almost came off as an ad," Auerbach said. Smartphones are what people are filming their videos with, so it's just more relatable, he said.

The pair still use professional lighting equipment, which Auerbach said was key for video performance.

"Having a video well-lit and making it seem bright has really been a game changer," he said.

He and Twer also carefully plan each story and write scripts before shooting.

"It will take us a half day to a full day of work, start to finish," he said. "Other people are kind of using this thing to dance and then just post that. We want to be known on TikTok as being the guys who are creating new and funny content consistently."

SEE ALSO: A college TikTok influencer with 1.6 million followers explains how much money she makes — and her 3 main sources of income

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