Rush to make money from amateur video can leave creators behind

Companies are stepping up to help amateurs turn their online and smartphone videos into cash. But there's no standard yet for how much creators are paid or how their video is used.

Offers flow in to earn cash for viral video, but few companies have a track record

Did you capture something unexpected or unique on your smartphone's camera? Want to turn it into cash?

Canadians who have recorded vivid and compelling video are being approached by a growing number of media companies that offer to license homemade productions and then share the fees that get collected when marketers, broadcasters and other websites pay to use the material. 

The content that attracts attention is often goofy (such as a corgi belly-flopping in Shuswap Lake, B.C.), accidental (a sword trick gone wrong in Vancouver), or newsworthy.   

Michel Chamberland, a process operator at Syncrude, earned a licensing deal for his footage of the Fort McMurray wildfire. 

"I posted my video to YouTube, and in the next couple of hours a lot of news networks started inquiring about it," says Chamberland, who had dashcams on the front and back of his Dodge Ram as he tried to escape the wildfire. "Then the next morning I got a call early in the morning asking if I wanted to license the video."

It was ViralHog on the phone, a Montana-based company that specializes in amateur video, or "user-generated content" as it's known these days. A member of ViralHog's team had seen Chamberland's dramatic footage: a long line of cars barely moving as fire rages at the side of the road, embers floating through the air, a motorcyclist clearly suffering from the heat of the flames speeding past the lineup.

Chamberland says he was offered 60 per cent of any revenue generated, with ViralHog keeping the rest.

"I thought maybe I could use that money to put towards the cause, a donation to the Red Cross," says the Fort McMurray native, who lost his home in the blaze. "It might be a couple thousand dollars or something — it won't be a 100-million-view video."

'Borders on harassment'

Most people would likely be delighted to be offered a chance to cash in on their video, but some industry insiders warn that too many companies are jumping into the space, and not all of them are entirely reputable.

"There's a lot of ambulance chasing going on," says Rahul Chopra, CEO of New York-based Storyful, one of the largest operators in the industry. Originally from Toronto, Chopra says bidding wars have broken out for very hot videos, such as the one where a father treats a baby like a musical instrument

"You're talking about people being accosted in emails and on social platforms. It borders on harassment," Chopra says. 

He also says there have been plenty of complaints on social media from people who feel they were misled by a licensing company. Others say they weren't given proper credit. 

"It's still such a nascent space that I think a lot of companies are trying to take advantage," he says. "From our perspective, it's pretty frustrating. It gives the space a bad name."

Ethics in a Wild West environment

A journalist founded Storyful during the Arab Spring uprisings of 2011. As amateur video flooded out of the region, news organizations struggled to authenticate what they were seeing. Storyful provided context and background on those videos, and eventually began selling subscriptions to its service. In 2013, News Corp. bought the company and Chopra became CEO.

"We work with 150 of the biggest news organizations in the world," he says proudly. "We were founded to bring in an ethical rights model to a Wild, Wild West of user-generated content."

Nowadays a large chunk of the company's revenue comes from licensing video to marketers for commercial purposes.

One Canadian who has no complaints about the industry is Jared Frank. The 24-year-old has collected approximately $30,000 in fees from his viral video. Two years ago while backpacking in South America, Frank decided to shoot a selfie beside a moving train. He wasn't hurt, but when someone on the train stuck out their foot, Frank got an unexpected boot to the head.

"I posted it online so my friends could watch it," the University of Regina student says. "I didn't expect it to get that popular."

The video currently has close to 40 million views.

Hello Regina, it's Los Angeles calling

Jukin Media of Los Angeles approached Frank about licensing. It's the other large operator in the industry, and is more focused on entertainment than Storyful. Jukin has a bunch of "content brands" on YouTube and Facebook, including  FailArmy, JukinVideo, People Are Awesome and The Pet Collective. All of them feature amateur video.

But licensing companies are tight-lipped about the specifics of the deals they offer to content creators.

"The percentage we offer on a revenue share is confidential," Jukin founder Jonathan Skogmo says. "Some people want cash up front. It could be anywhere from $50 to $5,000."

Jukin is certainly cashing in. From a humble beginning in Skogmo's apartment in 2009, the company has grown to 130 employees working in offices in Los Angeles, New York and London. Its investors include Samsung, Maker Studios and Bertelsmann Digital Media.

In Toronto, a company called boasts connections to Microsoft, Yahoo, X-Box and MTV, and says content creators can make ten times what they'd earn on YouTube.

As for Fort McMurray's Michel Chamberland, he's waiting for his first payment from ViralHog.

"They pay on the 15th of every month," he says, noting he doesn't expect the cash to flow for long. "I know how viral videos work. They're popular for a few weeks and then they're gone. So you want to work quickly."


Dianne Buckner has reported on entrepreneurs for two decades. She hosts Dragons' Den on CBC Television and is part of the business news team at CBC News Network.