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YouTube Paying Millions to Keep Its Biggest Stars From Looking Elsewhere The site's most popular stars are being paid to produce new content as other channels seek to court them.

By Laura Entis

Opinions expressed by Entrepreneur contributors are their own.

In a play to keep its stars from defecting to other platforms, YouTube is providing its top creators with "millions of dollars" in funding to produce new content.

Yesterday, the platform announced that it will provide provide funding for some of its most popular stars – such as fashion star Bethany Mota and Epic Rap Battles of History – enabling them to create higher-budget content and experiment with video format.

"Now, we feel the time is right to make another important investment in our creators. That's why we've decided to fund new content from some of our top creators, helping them not only fulfill their creative ambitions but also deliver new material to their millions of fans on YouTube," wrote Alex Carloss, YouTube's head of originals, in a blog post announcing the news.

Related: How Facebook Is About to Get More Like YouTube

While the post didn't get into specifics, including which stars will receive funding and how much money YouTube plans to invest altogether, it does suggest YouTube will be heavily involved in the production of new content. "As any creator will tell you, making compelling new content isn't easy, and we expect to learn a lot through this process. We'll experiment with new formats and ideas," Carloss wrote. "We'll get our hands dirty. We'll make some mistakes. Together, we'll (hopefully) create some fantastic new content on YouTube."

The tech blog Recode, citing video producers and distributors who are discussing deals with YouTube executives, reported that YouTube may use the money to hire more established Hollywood producers to work with its stars. One anonymous producer told the outlet that YouTube was planning on spending "single-digits millions" to create a 10-part series.

Related: YouTube Creators Can Now Receive 'Tips' Directly From Fans

As YouTube stars continue to gain more followers and influence, they are increasingly being courted by other channels, including Vimeo, Vessel (a forthcoming video platform from former Hulu CEO Jason Kilar) and recently, Facebook. With this recent investment, however, YouTube ensures that content from its top stars will remain exclusively on its site.

This isn't the first time YouTube has spent money to create programming on its site. In 2011, it dropped more than $100 million to create new "channels" featuring celebrities such as Madonna, Ashton Kutcher and Sofia Vergara. But this time around, the approach is different: instead of focusing on Hollywood celebrities, YouTube is providing already-popular home-grown YouTube talent with a Hollywood-style budget.

Related: Spinning Viral Stars Into One-Man Empires: The Rise of YouTube's Multi-Channel Networks

Laura Entis

Staff Writer. Frequently covers tech, business psychology, social media, startups and digital advertising.

Laura Entis is a staff writer at Entrepreneur.com.

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