Our tax dollars could soon be bankrolling your favourite YouTuber.
What happened: YouTube Canada is calling on the federal government to create a new lending stream through the Business Development Bank of Canada (BDC) for online creators. The idea is to factor influencers’ platform income and IP into credit assessments for small business loans.
The streaming company is also urging Ottawa to create a new influencer classification code in order to better capture the economic data of the industry.
Why it matters: According to YouTube’s internal data, creators are quite the buoy for Canada’s economy, contributing $2 billion to the country’s GDP last year and supporting 35,000 full-time jobs. Given that the company is admitting that there’s no accurate way to track creators’ economic impact, these numbers should be taken with a grain of salt.
YouTube argues that many creators can have a hard time scaling up like a traditional small business. With access to sector-specific BDC loans, they would be able to hire more staff, invest in equipment, and grow their business more effectively.
Yes, but: The influencer economy is top heavy, calling into question which ones need loans versus which ones might actually qualify for them. Per one analysis, the top 10% of YouTube channels account for 94% of views, while over two-thirds of creators make less than $10,000 a year.
Our take: There’s undeniably real money in the influencer economy, but the nature of the internet makes income sources extremely volatile compared to other small businesses looking for loans. A mom-and-pop auto shop may have a lower earnings ceiling than a viral influencer, but it also can’t lose 75% of its revenue on the whim of a new TikTok trend.—LA
