Matthew Patrick’s most unique achievement is not growing his YouTube account into a multi-channel media business with over 40 million subscribers, but rather selling the company and successfully exiting a career that was both emotionally and logistically difficult to leave behind.
In a touching video posted earlier this year, Patrick, known online as MatPat, shocked viewers with his decision to step back from his high-profile career. He explained: “I don't like late nights. (Wife) Steph and I, we've been doing this for over 10 years. I have dinner with my bestie and we talk about business logistics… I miss the days when I could sit on the couch with her and play video games. And that's not for content.”
When other YouTubers quit, they usually stop uploading videos and move on to something else. Even for YouTubers big enough to sell their channels, exiting the industry is notoriously difficult. Their businesses are already seen as risky by buyers, as they are so dependent on the whims of social platforms like YouTube, Instagram, and TikTok. And because creators themselves are central to a company’s brand, it’s hard for buyers to gauge how important their involvement is to the success of their channel.
Nonetheless, MatPat managed to get media company Lunar X to acquire his company, Theorist Media, and after a years-long turnaround, he made enough money to retire (he wouldn't disclose the exact amount).
“We talked to 10 different companies,” MatPat told TechCrunch. “We ended up choosing the one that we liked the brand for and recognized that we’ve built a very solid, very recognizable, very loved brand over the last 10 years.”
Making YouTube your full-time job is a dream, but it’s not sustainable forever. As the creator economy matures, Theorist, which employs 22 full-time employees and about 20 freelancers, is seen as a blueprint for how creators can make this kind of business transition.
“Creator media companies are vulnerable because they’re driven by a core group of people,” longtime creator and entrepreneur Hank Green told TechCrunch. “When you die or want to retire, it just ends, and that’s kind of sad. It’s like, did I build something that’s going to last long enough to finally be able to take a break for the first time in 10 years?”
For example, Green's oldest channel, vlogbrothers, would not have been acquired. It's a 17-year-old series where he and his brother John make videos for each other. You can't take the brothers out of the title in vlogbrothers.
“That was part of the evaluation process,” MatPat said. “How people-centric is Theorist, and if we were to acquire Theorist as a company, would we be tied to that?”
But according to MatPat, Theorist was in a good position to transition to a new host because the format of the show is more easily reproducible. While MatPat’s personality was the initial driving force behind the channel’s popularity, his video format made it a bit easier to bring in a new host. On his main channel, Game Theory, MatPat delves into video games and makes explainer videos about his theories. But with the right writers, other hosts can emulate his video format and quality.
“It’s an unproven ecosystem right now. We were one of the first to have a successful acquisition and a successful transition in this space,” he said. “But after we did that acquisition, we got a lot of calls from other YouTubers who wanted to sell.”
Lobbying for creators
MatPat is retired from YouTube, but he’s still pretty busy. In fact, he spent a lot of time on Capitol Hill. Now that he’s no longer making videos, he wants to use his status as one of the most successful YouTubers of all time to educate lawmakers on what small business creators need.
“It's strange that Matt Pat, who had just had huge success on the platform and was a well-known YouTuber in the industry, suddenly became a nobody in Washington, a de facto salesman for a $250 billion industry,” he said.
He’s willing to take a hit to his ego for the sake of his industry. MatPat and his wife Stephanie, co-owner and COO of Theorist Media, feel strongly that their leaders need to understand how creator businesses work. According to Goldman Sachs, the creator economy could be worth $500 billion by 2027. Oxford Economics estimates that YouTube’s creative ecosystem supported more than 390,000 full-time jobs in 2022.
“We’re trying to educate legislators about what the creator economy is, that it’s a real job, that we’re actually small businesses, and as a result, there are certain tax laws and things that apply to small businesses,” Patrick told TechCrunch. “Even when you talk to accountants, they’re like, ‘Right? There’s no clear indicator on the tax forms of what a creator business is.’”
Lawmakers are notoriously behind the times when it comes to technology. Some elected officials have a hard time conceptualizing how Facebook itself makes money, or even how creators can use the social media platform to launch multi-million dollar businesses. When TechCrunch met MatPat at Vidcon, he had just returned from a visit to Capitol Hill, where he realized just how far we have to go.
“Last week, when I was talking to lawmakers, there was a question like, ‘Question 1, what is Roku and how is it different from YouTube?’” he said. “That speaks to where we started.”
Without a lot of regulatory oversight or understanding of how things work, creators and their businesses are left vulnerable. Being a self-employed business owner is hard enough, but being financially dependent on a big tech platform makes things even more complicated. Even small algorithmic changes can affect a creator’s ability to reach their audience, and fewer views mean less money. There are no industry standards for wages when it comes to brand deals and partnerships.
“This isn’t just about New York and California. The biggest creators are coming from all over the country,” MatPat said. “When we were on Capitol Hill, we had a meeting with a local representative and we were like, ‘Hey, did you know that the biggest YouTuber in the world is in your state?’ And she was like, ‘Oh yeah, he’s McBeast, right?’”
Even small policy changes can make a big difference to creators.
“Right now, there’s no designation or official government record that says, ‘I’m a content creator by profession. I make a lot of money by creating content, videos, social content, things like that,’” he said. “So a member of Congress can look at, ‘Oh, my district in central Iowa has a lot of content creators. That’s a big part of my district.’”
The creator industry is often criminalized. Making online videos sounds more like a hobby than a job. More and more kids are saying that being a YouTuber is their dream job, but only a small percentage of aspiring creators will make enough money to make a living. But MatPat sees aspiring creators learning a lot of transferable skills on YouTube.
“I absolutely believe that starting a YouTube channel with the hopes of becoming a successful YouTuber is a good idea and I would recommend it to anyone because the skills you gain from doing so are so applicable to so many different worlds,” MatPat said. Creators need to master public speaking, scriptwriting, video editing, filming, social media marketing, data analytics, and more. “One of the things I hope people find is that there are transferable skills. For example, I may not be doing this job, but I learned all this stuff from doing YouTube, and it applies.”
Matt Pat's retirement has moved the industry forward by showing that retirement is possible, and he hopes to make even bigger waves in Congress.
“If our legacy is to strengthen the legacy of the next generation of creators, that’s great,” he said. “That’s the best note I can end on.”
