Nebula Blog

Nebula Originals

TLDR: We’re going big on Nebula Originals, and we’ve hired a new chief content officer to help make it happen.

Nebula began life as a joint venture between Standard, a talent management company, and the group of creators we represent. The partnership is simple: the creators provide streaming licenses, and we provide the resources to build the platform itself. We split the profits equally, and if we ever sell Nebula, we split the proceeds evenly.

Our build mode energy has been well-spent. Four years after launch, we have apps available for iPhone, iPad, web, Android, Apple TV, Roku, Android TV, Samsung, and LG. We launched our own API, built a custom streaming backend, and added support for classes and podcasts. As a platform, Nebula is fairly built. As we look at the horizon, where do we put our energy to keep up our half of the bargain?

Earlier this year I talked about Snow Leopard, our plan to spend 2023 focusing on refinements and bug fixes rather than major new features. By June we had seen so much progress in our thinking and so much benefit to the organization as a whole that we realized Snow Leopard isn’t a one-year project, it’s a way of life. This needs to be our new normal. We’ll still add features, of course — our recommendations system is in development and already helping us to understand new ways to help viewers find things they’d enjoy. Our work is very, very far from complete and we have a long roadmap in front of us, but there’s an argument to be made that our build mode phase is over for the platform. Nebula as a piece of software is much more in run mode.

Where will we put that build mode energy? Nebula Originals.

For our first few years, Nebula has primarily been a creator streaming service, not a content streaming service. Our focus has been on creating a wonderful home for all of the things our creators make. As a bootstrapped independent company, we don’t have billions of dollars to throw at content development; our experiments have largely been smaller-budget projects that tackle a more adult subject matter, or break the creator’s typical format. The few times we’ve really swung for the fences, though, the results have been extremely compelling. Night of the Coconut, The Prince, and even Jet Lag were designed to get a little more ambitious and see what happened.

What happened is that the audience has started to associate us with specific Originals as much as specific creators. There’s an element of prestige in this projects, which grants Nebula itself an air of prestige. We think this is the most compelling future for Nebula.

Over the last few months we’ve completely redesigned and re-implemented our Nebula Originals development process. That process, we feel, should be creator-led, so we’ve turned to someone with an excellent track record for successfully developing and executing a variety of formats: Sam Denby, of Wendover, Half as Interesting, Extremities, and Jet Lag fame. (He didn’t have enough to do.) Sam has joined the team as our chief content officer to lead Nebula Originals development, aided by both our internal team and by the team at Wendover Productions.

This is a seismic shift for us. While we’re slowing the pace of growth for the software team, we’re not stopping entirely, and this change won’t cause money to magically appear in the hands of the content development team. This will be a steady shift across the back half of this year, with the real gains coming in 2024. We hope to use the development process itself to generate enthusiasm for projects by announcing them with more fanfare and much earlier. (We’re also looking at ways for the audience to directly impact budgets for given projects, but more on that later.)

We’re actively soliciting pitches from our creators and a select few outside friends. The team has crafted a pitch guide, and built a system to offer one-on-one development support for folks who have never pitched a show to a network or streamer before. The new process is in full swing, and we’ve already heard some genuinely bonkers ideas that I can’t wait to help make into reality. Expect to hear more soon, as we begin to announce projects in development and build out our slate for Q4 and 2024.

Nebula creators are an immensely talented group of people, and we want Nebula to not just be a home for what they make, but an epicenter of creative and professional growth, empowering and enabling them to create things above and beyond what’s possible on public, user-generated platforms.

The creators built Nebula. Now it’s time for Nebula to build the creators.

Recommended For You

One of the more surprising phenomena to emerge from Nebula’s growth is discovery. When we started, the assumption was that a subscriber would come in for the creator or creators they loved. Our community was small, so you could easily browse the categories, find the creators you already knew, follow them, and move on with life. To our bemusement, people almost immediately started clicking around and just… watching stuff. Maybe the curated nature of Nebula leads to greater confidence in exploration.

We didn’t design or expect Nebula to be a discovery platform, so while we enjoyed reading emails, tweets, and reddit posts from folks who had discovered new creators they love and binged all of their videos, we weren’t really sure what to do with it. Our Featured page, modeled after Apple’s App Store more than anything else, was comprised of a hero rail, there to promote Nebula Originals, and a random assortment of loosely-defined category rails. I’ll be honest: we were just trying to fill up the page to prove we had stuff you could watch.

As time went by, Featured became more sophisticated. We added rails designed to show off exclusive content types, and our editorial team started creating topical rails to coincide with world events or big movie or game releases. These editorial rails are intended to take advantage of the evergreen nature of most of our catalog. Aside from me occasionally complaining about puns in the rail names, the team has full autonomy over what gets featured.

To keep things fresh, we also added a top rail called “Latest Videos”. This is just a waterfall feed of every video as it gets posted. We average 10-15 new videos per day, so this does a great job of giving Nebula a bit of life. It also helps the audience spot things they might enjoy from creators they may not be aware of. This works great until we start getting complaints that TLDR News fills up the rail every morning and people start asking for a mute button.

Nobody actually wants a mute button. Not really. What people want is to use that rail for discovery, and they want it to only be populated with things they’d like. Filtering the waterfall will only work for so long — eventually we’ll have enough creators releasing enough new videos that no amount of muting will bring it under control. Mute? No, what the audience wants is a recommendation algorithm.

Fine. We’ll do it. You’re getting a recommendation algorithm.

I know, I know. Believe me, I know. There are a million ways to get this wrong, and millions of people have millions of opinions about what works and what doesn’t. However, despite what some might guess, we’re not of the opinion that recommendation systems are inherently bad. Our careers are made possible by recommendation algorithms. We discover new creators through recommendation algorithms. Some of my best friends are recommendation algorithms.

The reason creators are often frustrated by recommendation systems isn’t that they’re evil, it’s that they’re opaque, and that opacity can easily feel unfair when your hard work suddenly doesn’t perform as expected and you have no way of immediately identifying why. There’s an entire cottage industry of low-effort content gurus who will gleefully charge you to give you recycled advice on how to improve your thumbnails.

What makes these systems good or bad is how they’re used. In our case, Nebula has a distinct advantage over public, user-generated content platforms: curation. The average Nebula video is of objectively higher quality than the average video on any social media platform. Nebula videos are nutritious. We have no junk food to push on you, and no advertisers for which the content needs to be ad-friendly. I’ll humbly submit that if we were to randomly choose ten videos for you from our catalog, you’d probably enjoy at least one of them.

This presents an interestingly low barrier to entry, and a solution to the real problem that many of us have with these recommendation systems: lack of transparency. What if — and I’m just spitballing here — what if we, like, just told everyone how it works? We could ship a minimum viable product version of a recommendation algorithm in a week, and collect feedback from creators and subscribers over time to make it better and more fair, and we could openly discuss how we do it so that others can chime in and offer suggestions for how to keep it balanced.

Yeah. That sounds cool. Let’s do that. Instead of spending ages building an opaque, potentially broken system for people to complain about, let’s scratch an immediate itch and make it a conversation all of the stakeholders can participate in. We’ll treat this feature as a public beta, make it visible to everyone, and invite discussion. We’ll hold regular roundtable discussions with our creators to refine the system over time, based on their needs and the feedback from the audience. Most importantly, we’ll document it. We’ll keep an up-to-date breakdown of the system logic at go.nebula.tv/algorithm for anyone to read.

At its best, a recommendation algorithm is an adorable robot puppy. It excitedly greets each new visitor with things the visitor might like. Over time, as the puppy is trained by behavior, it gets better and better at guessing what each visitor would want to watch. You liked this video, and other people who liked it also liked this other video. Would you like to see it? The puppy just wants to make you happy.

As a creator-built platform largely designed to sidestep the frustrations we felt with recommendation algorithms, we realize the only way we can feel comfortable building our own algorithm is to do so in a way that every creator can understand and contribute to. The system needs to have clearly defined goals and priorities, and safeguards to ensure that smaller creators don’t get pushed down.

We’re building this according to three simple, straightforward rules:

1. The algorithm should be transparent. The creators and the audience should have a reasonable understanding of how the system works. This is a conversation, and we need all participants on the same page.
2. The audience should have tools to control what they see. Over time we’ll add settings, like buttons, and other feedback systems. Recommendations shouldn’t only be based on behavior.
3. Creators should take priority in recommendations. User behavior is good and interesting, but no matter how hard we try, the creators will understand those relationships better than we can. We’ll give the creators themselves tools to influence what gets recommended after or around their videos.

For the beta launch, we’re keeping it simple by adding a couple of rails at the fringes of what we think will eventually be truly useful: “Discover Something New” and “Channels You Might Have Missed”. In terms of “discovery” this is obviously a little reductive, but it’ll help us start to understand a little more about user behavior and — importantly — the impact on site performance. Going deeper will require a little more internal tracking of user behavior, which we want to approach very, very cautiously. Over the coming weeks and months we’ll apply what we learn to more experimental rails, based on the heuristics laid out in our algorithm definition, and informed by feedback from subscribers and creators.

It won’t be perfect to start. That’s the point. Let’s train this puppy together.

Now Hiring: Junior Production Talent

We’re hiring junior video production people. If you’re excited and talented and looking for your first (or second) real job in creator economy video production, we’d love to hear from you.

Nebula Studios is a world-class team of exceptional people. Our team has led or has had their hands in projects from nearly all of our creators, including Real Life Lore, Jet Lag, Modern Conflicts, LegalEagle, PolyMatter, Lindsay Ellis, and honestly it would be faster to type up a list of the folks who haven’t used the Studios team yet. Video essays, stage plays, documentaries, feature films. I’m truly amazed by the range and diversity of talent.

Digging into process over the last few weeks — categorizing things and getting a better handle on the differences between rapid-turnaround YouTube videos and prestige-style Nebula Original — we’re left with a much better understanding of how to build into the future, and a large part of that comes down to an interesting problem we only now realize we face: we don’t have enough junior people.

This is good news from most angles. It means we’ve built such an effective talent development pipeline that we’ve very efficiently helped junior folks gain the experience to move up. However, it also means that we’re currently missing the next round of junior people. We want to keep our mentoring skills sharp, and some tasks are simply better suited to folks who are learning the ropes. As more and more of our senior people get assigned full-time to top creators, we have more need for enthusiastic fresh eyes.

Entry-level jobs are important. They’re how we learn when we’re just starting our careers, and in an industry that is still very much in the invention phase, it’s more important than ever that there be great places for people to gain experience and see how things are done in the real world. YouTube-style video production has distinct needs, and there’s no YouTuber University where one can go to learn the skills and processes specific to this kind of work. (Not even — humblebrag — my NYU class on being a professional YouTuber.)

We’re well-aware that there’s a vast sea of hungry young editors, motion graphics designers, artists, thumbnail designers, and sound engineers out there who want to break into the industry and work with top creators. Many of them have aspirations of being creators themselves. We think our problems are complementary, so we’re adding a bunch of positions to our jobs page for junior production positions.

These aren’t unpaid internships. These are paying jobs where you’ll be on a team of skilled, experienced professionals with the history, context, and scar tissue of working on many high-profile projects with a variety of personalities. Our goal is to help turn junior people into senior people over time, growing our talent pool and offering more diverse perspectives and services to the creators we represent and serve.

If you’d like to be a part of that future, take a look at our jobs listings. Our standards will remain ever high, but we’re looking for enthusiastic, raw talent, not extensive resumes or fancy schools. Starting now, we’re going to keep all junior and mid-level production positions open perpetually — we can always make room for more exceptional people.

The Prince: Special Edition

Now streaming: Abigail Thorn’s The Prince, fully remastered, with a full behind-the-scenes video and a Q&A with Jessie Gender.

Leading up to the original release, we recognized that there were areas we’d like to give a bit more polish. This is a filmed live performance; not everything goes perfectly, and not every microphone stays where it’s supposed to. None of these issues were showstoppers, and in the spirit of theater, the show must go on.

However, we feel that The Prince is an important piece of art, and part of our responsibility as stewards is to ensure that it’s preserved in the best state possible, so immediately after release we set ourselves to the task of adding the polish we believe the play deserves.

In the original cut, some of the audio came out distorted or muffled. Probably from a mic coming untaped and rubbing against costume. Mike Wuerth and Graham Hearther, two of the producers on the Nebula Studios team (and both audio engineering masters in their own right), did an incredible job of cleaning up the tracks. The show was filmed over two nights, so Mike was able to use the audio from the second night to fix some microphone problems. Graham went through and precision-adjusted EQ to improve intelligibility in some areas. All of this with a careful eye on not encroaching on any of the actors’ performances.

The lighting design of the stage isn’t always easy to capture on camera. Ryan Alva, our resident colorist, pulled in the original raw footage and gave every shot a more intentional color-grade. Not to change anything, but to make the experience more immersive and theatrical.

We also made a few small edits to the timing of camera changes, since a camera lingering too long on an stage actor can unintentionally weaken the performance through missing context.

But wait, there’s more! Also included now are a half-hour making-of documentary, taking you behind the scenes of the entire process, and a 42-minute Q&A with Abi, hosted by Jessie Gender.

This isn’t a George Lucas overhaul. We think the end result is a cleaner, more immersive and enjoyable experience. When I told Abi we were doing it, she insisted that it wasn’t necessary — that the original release was already great. I appreciate her indulging us and letting us finish what we started. It was worth it.

Lifetime Memberships

Update: We’ve ended the experiment for now. We hoped to land around 1,000 lifetime memberships sold in the month, but we blew past that in about four days. After exactly one week, we’re just over 1,500.

This was dramatically more successful than we anticipated, and in some interesting ways. Most of the people who went for lifetime were either new subscribers (56%) or folks upgrading from the bundle (32%). What does that mean? We have no idea yet.

The plan now is to pause, take a close look at the data and what it means, and think about how we’d want to go about doing another round. I think it’s safe to say we’ll do it again. Next time, we’ll clearly telegraph start and end dates for the promotion.

Thanks for indulging us, everyone. This was so much more successful than we could have hoped.

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We’ve just launched a little experiment. For a limited time, you can sign up for a lifetime membership to Nebula. This isn’t a lesser tier of service. This gets you access to everything that the monthly and annual plans do. There’s no catch.

We’ve gotten a couple of comments on Twitter and YouTube about this being portentous of some kind of imminent implosion, so I thought I’d take a moment and explain why this experiment is interesting to us, and what we hope to get out of it.

The short version: raising cash makes sense for a streaming service to invest in producing bigger projects, and we prefer doing it via lifetime memberships versus giving up equity and taking on VC money.

The long version is also pretty interesting:

We knew at the beginning of the year that we would be taking over the handling for Nebula marketing costs ourselves. Up until recently, all marketing spend was handled by our bundle partner. We’ve been running models for a long time in preparation for this change and we were confident it would go reasonably well, but we aren’t a VC-backed startup or a trillion-dollar megacorporation; taking over hundreds of thousands of dollars in monthly marketing spend represents a significant risk for us. We had to plan for every scenario.

After a couple of months of spending nearly $1m total to sponsor our own creators, our team has learned a couple of things which have seriously surprised us.

All of our models were based on user trend data we had — data from direct subscribers. Until recently, direct subscribers were in the minority, and we’ve never really promoted direct subscriptions aside from the launch of Nebula Classes. That data suggested that monthly subscribers would be the dominant group. The reality? Not even close. Here’s a screenshot from our analytics dashboard. Dark orange is monthly subscribers. Light orange, top, is annual.

Our total count of annual subscribers has more than doubled in two months.

Why is this so exciting? Well, annual subscribers stay longer, so there’s reduced churn. That’s obviously good for the stats. But annual subscribers also pay up front. While we theoretically make more money in 12 months from a $5 per month customer than we do from a $50 per year customer, we can do more with $50 of today money than we can with $60 of next year money. Spending, for example, $25 on marketing to bring in a new customer is reasonable if you expect the lifetime value of the customer to be, say, $75. But at $5 per month it’ll be five months before you break even. For some period of time, you’re dipping into your savings account. If a bunch of those new subscribers pick the annual plan and pay $50 up front, you can reduce the amount you have to take from savings. But if a whole bunch of people pick annual, you might come out ahead every month.

This is where we landed. Since the change to direct promotion, a wide majority of new subscribers are choosing annual, and in under 30 days we generated more first-month revenue from new subscribers than we paid to bring those subscribers in. By the end of March nearly 90% of our first-month revenue was from annual subscribers.

This is the buried lede: when we took over our marketing spend to focus on direct subscribers, we instantly became one of the largest and most successful sponsors on YouTube, and if things stay on their current course, we can keep that up sustainably without having to go back to savings again.

Okay, so why lifetime?

We aren’t currently spending from savings to pay for marketing. That’s great. But that first month did come from savings. It wasn’t a huge dent and we’re filling it back up, but again, we’re not a VC-backed startup. We don’t have hundreds of millions of dollars we don’t know what to do with. Our strategy is sustainability, and our growth comes from making good choices with and for our creators, not from spending indiscriminately on casting the widest possible net.

The original plan, back at the beginning of the year, was to use lifetime memberships as a buffer. A way to raise a little bit of capital in case things were rougher than our models suggested, and to do so without having to give up equity. As our actual performance outpaced even our most optimistic models, we realized there was still an interesting opportunity in raising capital this way.

Cash is king in any business — that isn’t unique to us — but Nebula is in an especially interesting position as a streamer. We have marketing costs, operational costs, and content costs. Operational costs are long-term, so you don’t typically want to make hires out of short-term cash bursts. Assume marketing is a relatively stable system for the moment. A short-term cash infusion for content? Now that’s interesting.

Our three biggest projects last year were a sci-fi movie about an evil coconut, a trans coming-out theater performance take on Shakespeare, and a travel game show. Super fun experiments that went over incredibly well, and suggest that our audience would love more creator-led big-scope projects. We have ideas. Our creators are pitching really cool stuff. We want to start making those projects real today, not in several months when the bank account fills up.

Okay, so why “experiment”? Why only for a limited time? What does success look like for this experiment?

The internal codename for lifetime memberships was “Project McRib.” The idea was that we’d turn it on, see how many people were interested, take some notes, then turn it back off until we felt like we understood what we were looking at. Then, if it makes sense, occasionally bring it back when we want to duplicate the experiment and raise some more cash for big stuff again later.

Maybe the pricing changes later. Maybe nobody is interested. Maybe having a more expensive option above the annual subscription makes annual the more attractive price point, improving cash flow and retention overall even if zero people sign up for lifetime. If there’s enthusiasm and people are trusting us enough to spend the money on a lifetime membership, that tells us something about how the audience sees us overall. If nobody goes for it, that also tells us something. My goal for the experiment was 1,000 lifetime memberships sold. In the first 24 hours we had over 300 people sign up. I’d say that bodes well.

Another thing to consider in all of this is the creators themselves. We fund Nebula Originals in part based on how well we think they’ll do for bringing in and retaining customers. If, say, Jessie Gender has an exciting new project in the works and announces it to her audience and a bunch of them go for annual or lifetime memberships, we can increase the budget. It’s not quite as one-to-one as something like Kickstarter, but the cash flow could have a very real impact on how we build projects, and that knowledge might make creators more enthusiastic about promoting those projects, leading to a wonderful virtuous cycle where creators get to make dope shit and the audience gets to enjoy dope shit. And because creator payouts overall are based on signups and profit, changes in our cash flow have a very real impact on their businesses, too.

We knew that it would be the most engaged, highest-value-potential subscribers who went for this. We set the price based on what our current data suggests that lifetime relationship looks like. But — and this is absolutely crucial to understand — this isn’t about maximum value extraction on either side. It’s okay if we lose a few bucks over the life of those subscribers. It’s okay if we come out slightly ahead. The real goal here is to give the most enthusiastic and excited people in the audience a chance to make a significant up-front impact to the creators and to the system we’re building.

I’ve never been less worried about the future of Nebula. I’d just much rather answer to the creators and the audience than to venture capitalists.