The math of the business model doesn’t really pass the napkin test. How many celebrities and sublebrities do you need to be actively booking 10s to 100s of videos per day to get enough revenue to justify a $1bn valuation? Perhaps that means $100m annual revenue. If Cameo is generously getting say $50/booking, that means 2 million videos per year! That’s 500 washed up sitcom stars each doing 10 happy birthday videos every single day for a year!
If they get 5000 sitcom stars doing 10 videos/day for 200 days/year and Cameo gets $10 each, that's 5000*200*10*10 = $100m. Those numbers seem at least napkin reasonable to me..
5000 sitcom stars? I'm not in the US but are there really that many? What's the qualification here? Some guy who had a random walk-on in season 5 episode 3?
And you're thinking that 2000 people a year know about this random dudette? And will pay $50 for a cameo?
If you think this is reasonable then do I have an opportunity for you. (And even if it was remotely possible thats income, not dividends.. )
I disagree with the siblings on the choice of napkin math parameters, but they’re not like objectively wrong.
The bigger issue is that there is a different model for the granular micro-monetization of low-rent celebrity: it’s called being an influencer and it’s mediated by TikTok, not by Cameo.
And the low rent thing isn’t a diss: it’s moving upmarket faster every year.
> it’s called being an influencer and it’s mediated by TikTok, not by Cameo.
Now that you mention it, is it weird that social networks haven't moved into this form of monetization? Why does Instagram not have an influencer marketplace where you can pay for a post from a popular account?
Is it because of some nebulous "ick" factor that would cheapen their brand? Or is it simply because they can make more money by selling advertisements in the middle of the feed?
Yeah that’s the way I see it, instead of trying to get traditional celebrities to ‘sell out’ without hurting their band it is easier to extend the existing monetization options of the new emergent celebrity class to include longer and more private sessions.
Yeah, that business model actually made sense. Though I do think they should have launched it under some other brand, much like how Match Group did with Tinder
But are those D tier “celebrities” getting 10 requests per day? I really have no idea, but I can’t imagine people lining up to spend $145+ on birthday wishes from Kiaya, from MTV’s Teen Mom. Or is this why so many people are in debt?
Some do very well, though I don’t know if any single person is consistently getting 10 per day. I used to follow the 90 Day Fiance subreddit and folks were always linking to videos from the more well-liked cast members. Several have over $100,000 in revenue if the sites tracking these sort of things can be believed.
I get the "15 minutes of fame" thing, but it passes quickly.
I mean, sure, the current Survivor season might spit out 20 people who might make a few people happy this year. But is there really a market for Jane from season 8? Like a couple hundred a day?
Perhaps I'm wrong and all kinds of people are plunking down $50 for birthday messages all day long. (So much for a depressed economy...)
Clearly I'm not the target market and most ideas seem dumb when you can't imagine using a service yourself. Maybe there are 50000 customers a day dropping this cash.
And even then, which of these (mostly) highly paid and heavily scheduled professional athletes is side-hustling one minute at a time for $50 rather than banking 5 to 7 figures for a Gatorade or Nike endorsement?
Current male athletes in the "big leagues" would probably almost certainly be better served by doing something else, even sleeping.
Current female athletes are almost always paid less and might find it valuable.
Current minor-league, non-superstar professional athletes (so, probably 99.9%+ of them) surely wouldn't have much demand.
Retired recognizable athletes are surely also large beneficiaries. They usually have time on their hands and despite mass perception, most of them are not "set for life" financially.
I had a college friend who devoted about ten years of his adult life to baseball, made it to the majors for a few years, and made two or three million bucks. When you break it down this isn't a ton of money. First of all about 50% income went right to Uncle Sam and his agent. That leaves $1-1.5M for 10 years of work. That's good money, but once his baseball days were over he had to figure out a new career as a ~28 year old with no real job skills.
side-hustling one minute at a time for $50
Well, I imagine they batch things up. So it's more like you sit down once a week and do all your vids in one shot and pocket a couple hundred bucks for an hour of work.
Maybe not today, but get distribution of that back catalog right and everybody's happy? To great extent, people watch what is promoted to them as a trend, no?
Most famous/rich celebrities would a 9-to-5 type of job, lol. For them to be worth it, it would have to be like 1-10k per video, which the average person wouldn't pay at all.
Exhibit A, they're broke.
But I do appreciate their short life, I got a real fun video from Flavor Flav out of it :D.
My young daughter enjoys some short videos on Facebook of a nice guy who just enjoys nature. He's not at all famous, probably has followers in the low tens of thousands I think, but I paid about $25 to get him to do a video for her. I wonder how much of their revenue is actually from a much larger number of not-really-at-all-famous people rather than sitcom stars.
He probably undersold himself. That type of interaction is worth way more, to the point that savvy internet celebs really don't charge directly for those type of interactions. They keep them for their patrons.
I agree it doesn't add up and the valuation is silly. But I could see the model expanding to Asia, with kpop, jpop, and Chinese idols. But a local rival would have massive advantages and may already exist, idk. My point is just there's a bigger pool of semicelebs than US tv actors.
Acquiring a long tail of well known faces performing known procedures might make for an interesting training corpus. The resulting weights could make 100's of videos every day and probably do better i18n to capture celebrity arbitrage like how US actor David Hasselhoff is a musician in Germany. It could have gone well past there--imagine a digital photo frame where Jed from the Beverly Hillbillies (replace with your favorite) tells you about today's weather and stocks.
> How many celebrities and sublebrities do you need to be actively booking 10s to 100s of videos per day to get enough revenue to justify a $1bn valuation
That's the problem with tech startup culture. $10 million businesses get pumped and stretched to be $1 billion speculations and they collapse so now you don't have useful $10 million service any more. It's like demanding every car on the road must be modified to be a souped up sports car that goes 300 mph and you're totally willing to destroy the vehicle in the process.
Many years from now people will look back at this and think "these people were insane."
> Many years from now people will look back at this and think "these people were insane."
Well to be fair, if they were all insane then these VC's would have gone out of business long ago.
Every year we get one of these big VC bomb news cycles, with this same narrative in the comments that the valuation system is broken and VCs are out of touch, but they still seem to be getting sufficient ROI to be successful as the only niche capital market available to startups.
It's still possible these persistent edge cases where VCs all jump onto the latest social trends are far higher risk than they properly account for among their executive staff, but that doesn't mean the whole idea is flawed... it's also possible they have accounted for this risk and think they can eat occasional social-trend play hoping for a Facebook. idk I'm not a VC.
The private profit model works because there are unicorns. The problem is you really can't make a horse into a unicorn and doing so comes at the cost of something called "the public good", something that investment capital used to feel an obligation to until about 30 years ago, before everything got Jack Welchified.
It's hyper growth and catastrophic collapse, as a business practice. Investors are in for the growth and the costumers and employees are holding the bag during the collapse.
This practice has come to pollute conventional sectors as well.
Look at the stock ticker $BIG, belonging to the retailer Big Lots or RiteAid.
They'll come in, ride it on the way up through unsustainable debt based growth to make line go up, liquidate their profits and leave it to collapse and burn
Maybe everything falls under that. It's taken as read that the goal is supposed to be explosive and/or exponential growth, global takeover and multi-billion valuations for everything from software frippery for getting a birthday video from the guy who voiced the cat in Sabrina the Teenage Witch to chat apps and taxi bookings to hardware like phones, cars and ICs, industries like farming and mining and even services like banks. Is a monoculture of a few warring behemoths really the outcome that is ideal in the long run? At the human scale, it feels a bit like being a bystander (byfloater?) in a kayak during a nuclear naval battle.
A bit like real ecology, an ecosystem is said to be thriving most when there's a diverse and dynamic mix, with nothing particularly dominating. Though of course the agricultural output of such an environment is lower than 10000 acres of monospecies wheat fields tended by 30-plus-ton tractors[1]. I wonder what a world would look like if it were disallowed for any company or ownership group to exceed a certain size. Economies of scale would maybe then be more acheivable though federation and cooperation rather than monopolism, lawfare and secrecy.
And before libertarians start shouting or hiding under the bed, it's more a shower thought, rather then my personal NWO agenda. And I'm aware it would require more than national-level edicts.
God, yeah. This "unicorn or nothing" attitude is so absolutely toxic.
There are so many business models that could effectively work and generate hundreds of thousands to tens of millions of dollars of profit but our weirdo obsession with "it has to become the next Tesla or Uber or Apple or NVidia, or it's CRAP" is just awful.
I'm not sure whether to blame VC, or "normal" investors for simply not seeing the value in a profitable business whose ceiling doesn't involve trillions of dollars.
I don't think this should be surprising. The celebrities that people would want are rich enough that they don't need to say happy birthday to your friends. The celebrities using Cameo are the ones who are broke, or don't want to do a toothpaste commercial, or who can't get work because they're politically extreme, or simply not popular enough to keep a steady stream of (insert whatever they usually do) going.
Cameo stops being a good idea when the people doing the videos aren't exciting for the people who want the videos. We crossed that line years ago.
I paid Spike and Drusilla, from Buffy, to say/sing happy birthday to my wife. Neither are top-tier actors, but they're both completely recognizable James Marsters in particular I guess, as he's done a lot of narration for things like the Dresden Files.
There were "super-popular" actors available, for significant sums, but these two were cheap enough that it was a no-brainer to gamble on a good result, and both were fantastic.
Agree, I don't think product-market fit is the problem here. A lot of the takes here assume they need to attract top talent and they don't. There's a very long tail of popular-ish, C and D list celebrities who can command $50-$250 a video. There's a business that can work, though I agree it could never command the insane valuation it had at the peak. There's also a reasonably good likelihood that their costs aren't well managed.
There is always two sides I am starting to think here. The size of the team working and if that is growing when it does not need to and is it in some over priced location. And then there is how much is being burned on marketing. I have not seen it for Cameo, but just looking at sponsorship deals in social media and one wonders is there really that much money in this single spot?
A lot of people saying the business model doesn't justify a $1bn valuation (rightfully so), but I'm guessing the valuation wasn't for their current business, but on the possibility that Cameo became the new way for booking talent in the age of the internet.
They could have become a $1bn business if they had "revolutionized talent management" (or something like that). Not saying it was a good investment, or one I would have made, but I'm guessing they pitched a larger vision than simply a buttload of cameos from washed-up/reality TV stars.
If its not in the bank, it does not exist. Trust me: I own a business.
Me and a couple of mates have been doing it for 24 years. We have a slack handful of employees. We've had good and bad years. At the moment it is a bit bad. Bad to the point where we are down a bit on our personal remuneration.
You cannot replace loss of profits with loans. I might allow that you can use loans to bridge a known and controlled, temporary ... issue. That's a form of gambling and ideally you own or can kick the house in the knackers.
There are all sorts of exciting sounding ways of running up huge debts and messing around with funky sounding things like gearing ratios.
Do remember that not everyone gets to be a unicorn or even tinkerbell and plenty of businesses crack on and work and survive without being particularly exciting. They also might happen to be rather stable in a rather unstable world. They just get on with it.
Valuations, investors, squandered money, perhaps that was the whole plan from the begining, or it could be incompetence. Hope we’ll see less of this with high interest rates.
How did they not know about these requirements? I know this just by seeing the endorsement disclosures everywhere I see someone on video talking about a product. It's sort of like knowing that requirements for cookie usage is a thing just because you see the acceptance forms everywhere. Or that you could work out that stop signs are a thing because you see everyone stopping at them.
This is sad to hear. I love Cameo. I've purchased half a dozen of the videos, for myself, and friends. I gleefully paid for a video of Joel Murray, talking about Bobcat Goldwaith while walking down the street in New Jersey. I imagine it probably gets old for the celebrities, but I felt really lucky to be able to pay for their time and ask them a question.
"New York Attorney General Letitia James today announced a bipartisan, 30-state settlement with the owner of Cameo, Baron App Inc., for failing to ensure consumers knew that videos promoting products were paid endorsements...
In 2020, Cameo... launched a service called Business Cameo that allows companies to pay celebrities to record videos endorsing their products. The Office of the Attorney General (OAG) found that Cameo failed to implement measures to ensure those videos were properly disclosed as paid endorsements, which violated endorsement rules issued by the Federal Trade Commission (FTC) and New York’s consumer protection laws."
Cameo is in a great position to pivot to licensed generative AI cameos. They have the relationships with the celebrities that are willing to do it for money, and that seems like the hard part.
I have to admit there is a certain price I would pay to get Giuliani to record a video in front of the Four Seasons gardening shop. I'm not sure what I would ask him to say, but I definitely would pay for something.
