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Colonel Sanders, Ray Kroc, etc - they succeeded because they were hands on, spending vast amounts of their precious time personally visiting their restaurants to make sure they were meeting their high standards. When it comes to food, you can't put your name to something, be hands off, and expect quality to meet your standards and expectations. Mr. Beast apparently thought he could but decades of experience show otherwise. This story shows how quickly a business can be destroyed when an owner is absent.
The food industry is one you do not want to be hands off in if your name is associated with the brand because one minor error can ruin your whole business.
People think they can get into an industry they only know as a customer or supplier, but actually having knowledge and keeping an eye on things is more likely to succeed
Mr beast burger failed for one reason, and one reason only, and that's because ghost kitchens r proven not to work. The quality fails because you have no formality
Mr. Beast Burger is a case study on the value of ironclad franchise agreements with supplier and point-of-sale auditing. What McDonalds, Chipotle and Subway do with brick-and-mortar locations is not easy, especially with “virtual dining.”
well, it's a known fact that all restaurant business, regardless of franchise model or not, they all need on-site member to actually taste test and do quality control. This is a literal #1 rule of any restaurant business.
Using ghost kitchens and various existing restaurants meant that consistency was always going to be an issue over time. It's not the same as a franchise with branded stand- alone restaurants.
A big reason McD's is so so successful is because everything is consistent. Everything. You know what you're going to get. And when you walk up to the counter, ALL the friers will always be on the left. This isn't by chance.
@@uwu2owovr And one of the reasons behind the consistency is that they dictate not only what ingredients are used, but who you buy them from and what equipment is used to prepare them. Every aspect is specified. i don't see any way that could work in these ghost kitchen concepts.
Yup. Good idea on paper but consistency, quality, etc issues were always inevitable with ghost kitchens. Wish he would’ve used the initial success to launch brick and mortar stores. Nonetheless it was a good run lol
This is no different then when a famous actor or athlete opens a restaurant. In the beginning it is very busy, there is a lot of excitement in the city, people go there to eat one time. Then the excitement dies down and people stop coming because the quality of the food tends to be mediocre and the prices very high. In the end what counts is the quality of the food, the prices, location and the atmosphere.
Went into my local bargain 'dollar store' yesterday- there was a huge (untouched) crate of those Prime drinks Logan Paul and KSI were pushing a few months ago, being sold for a tiny fraction of the original price. That's influencer marketing for you!
@@philipjones3599It’s calmed down a lot now but they’re definitely still selling in the UK thanks to KSI’s popularity although probably no more so than many other famous electrolyte drinks. Still for a drink that launched a year and a bit ago I think Logan and KSI’s initial marketing push gave it a not insignificant market share that would likely have taken other brands a decade+ or millions in adverts to establish
That's interesting, the store I shop at always has shelves mostly full of them, with the stock changing every time I go. So they're clearly selling to at least some degree
The 10x multiplier is not a given. The underlying assumption is that the business will grow 10 times bigger to eventually justify the valuation. But Mr Beast is probably at the limit of RU-vid reach already and there is no more 10x gains to be made. What you see is what you get.
It's the dellusion. The chanel revolves around him. As soon as he leaves, the chanel goes. 1bn is insane for it and people compare it to the super bowl for ad revenue but it's all smoke and mirrors.
To me, it seems most likely that Donaldson lost interest in the business when it didn't generate his unrealistic expected returns. That's why he kept demanding a bigger slice of the pie. Continuing to promote the product became bothersome and the alleged QC issues were just a pretext for him to bail out on it entirely. The only thing he accomplished is to put other potential business partners on notice to steer clear of him and his brands since he won't keep agreements.
All these product marketers, including celebrities, sports figures, etc, all get paid to market and promote products and services for companies. This has been going on for hundreds of years......Mr. Beast is no different. I never buy products just because someone famous promoted it. In fact, when I see one of these celebrities promoting products, I'm more careful in reviewing products prior to buying.
That wouldn't have worked for what he was trying to do. The basic idea working with ghost kitchens and small businesses isn't that bad, but it needs good management and tight control to make it work.
My thoughts exactly. I'm thinking his ego got a bit too big and he thought anything with his name on it was bound for success. I remember seeing it on Doordash a couple of times, I'm not a fan of Mr Beast but I would have tried it out
I don't watch MrBeast (though subbed to him). How can you measure a celebrity's/content creator's value provided when you say one "offers so little"? Serious question.
He should have talked to them and not made podcasts about it first and sued behind the public. When he took it to public it was when they had an counter sue argument
One of these restaurants popped up in my home town in Ireland (a small town of about 20,000) and I think most people have just been left extremely confused by its existence.
I read german reviews. One reviewer claimed (and proved by pictures) that HAIR was IN the burger. You can clearly see that those are dropped while putting the sauce on the burger. Mr. Beast is the biggest name on RU-vid. Hands down. But he is NOW a business person. He is an influencer. The urge to expand rapidly is the worst you can do at the beginning. Having a stable and reliable distribution source (not by outsourcing) is the foundation. His main work lay's on those ridiculous stunts which made him a multimillionaire. He is like Elon Musk ... he has enough money and fame to screw up a few times. But he clearly did not learn from that mistake by releasing a chocolate bar. And his claims that his brand will be 10 billion worth in the future... oh lord ... you are a RU-vidR! You don't own your channel! RU-vid has every right to do what they want to do with your channel! As long as he moves away from RU-vid and takes his 130+mio subs with him, he will never be the big star in the world. PewDiePie was the biggest RU-vidr before him ... and so many channels are growing rapidly (with combined subs over 100mio!!) ... without your current fame ... the drop will be HARD!
Elon Musk screws up constantly- Cybertruck full production not until 2025 and oh boy Teslas built in Mexico while Musk toys with MAGA folks who aren't going to buy a Mexican Tesla
10B? I don't even believe anyone seriously offered him the 1B that he claims. He doesn't even technically own his own brand because like you said, RU-vid can destroy him overnight if they wanted. Anybody willing to pay 1B with that level of risk is not astute enough to have that kind of money in the first place.
He should start his own streaming service to become an entrepreneur. At the moment he is "employed". But if we look at SSSniperWolf... she got a 1 week demonstration... RU-vid is all about revenue and not about the people (creators or viewers). As long as he stays scandal-free in his personal life ... he might be gucci. The problem in the case of sniperwolf is, that the VIEWERS punish her. Look at the like/dislike ratio on her videos. She still makes a shiet ton of money ... but her reputation is finally destroyed.
When this came to the American Dream Mall, I did a quick check on what it is all about. I am too old to care about influencers, but I knew enough to know it was a disaster in the making. The reviews on the burger were mediocre. After getting passed the hype, the food and the service is all anybody cares about. Read the history of any successful change and you will find out how detailed each founder was and how much that detail is important to this very day. Burger King almost collapsed in the Eighties because they lost focus. How can some guy who is all about RU-vid think he can succeed in Burgers. The product leads the brand, not vice versa.
Should’ve just done a 6 month gimmick promotion and left it at that. Or every year announce there will be a run for x couple of weeks and have a chance to pump merch and ramp up marketing
I agree with you. He can market, and create gimmics, but not a successful end to end business that necessitates quality control, innovative manufacturing, and deals with right investors.
Sure, I grudgingly respect talent. But too many morons are influencers and of course their followers are the same. But there's a lot of people like that, a ready-made market.
The supermarkets down here in Australia just started selling Mr Beast chocolate...it's priced to compete with Lindt, a mainstream-premium brand. Never seen an advertisement for it either, and you've got Cadbury (that sells at nearly half the price) constantly advertising to compete with. I'll give it a few months until it's on clearance.
It's a mistake to get into a bad contract, but that doesn't mean the other party is not in the wrong. Virtual Dining are the ones who need to "deliver to spec" and appear to fail in a lot of cases.
A tip. Don't get delivery from delivery-only restaurants. Ever. Order take out and find out what business is making your food. In my case it's Buca di Beppo. My smashburger was made correctly. It is a high end burger, and worth the price. Much better ingredients than the big three. I think that getting delivery from a restaurant you haven't personally inspected is most people's first mistake when it comes to ghost kitchens.
yea ever since i learned about ghost kitchens from a youtube documentary like a year or 2 ago i stopped getting delivery unless i had been there at least once in person[even then i dont really anymore bc its so expensive]
Using ghost kitchens was shameful & lazy. I wouldn't have touched those burgers with a 10 feet pole. No way there would be consistency form one location to another.
Mr Beast's 60g chocolate bars are now on sale here in Australia for AUD$5. That's ridiculous. A standard 200g chocolate bar retails for AUD$3.50. He needs to be careful branching out into fast food and snacks as his reputation could be heavily affected.
@@bdogsp0012 ALDI's German made Choceur is AUD$3.49 every day, and it's silky smooth and delicious. Cadbury chocolate bars are sold at half price at Coles and Woolworths every few weeks.
@@bdogsp0012I just looked it up on woolworths app. Mr beasts chocolate goes for $7.42/100g $6.67/100g if you get the large, Cadbury goes for $4/100g. They must of recently dropped tge price for Mr Beast chocolate, it's now $4/60g.
A better strategy for him would have been to establish several large brick and mortar stores in established tourist locations. The constant stream of new people keeps the sense of novelty new and also allows for higher pricing. Sales could easily exceed 1 million a month
Well that's the whole point: MrBeast seems to avoid direct responsibility and a clear connection to profits. His financial gains often appear indirect, realized only after accounting for "charitable" expenses. He'll avoid mentioning this part of financial accounting.
@@angel_machariel that makes sense because I don’t know who MrBeast is, to me He’s just a anomaly that appeared on Yt one day. I think originally the ghost kitchen was a good idea especially for Covid, but I think it should’ve ran for like six months to a year and then open up a brick and mortar because at that point you should have funds allocated to that, but you are right. People have said he uses his money from YT for charity work so that he can make those RU-vid videos about charity work.
You just described the exact, like literally exact, business model that franchise and theme resturants are told to avoid because it's incredibly unsuccessful because *everyone* thinks that's how you sell a theme or franchise resturant and thus tourist heavy locations are by far the most saturated markets and so it's considered one of the worst ways to start any new venture of that type. The current reccomended strategy is either ghost kitchens that evolve into brick and mortar or if you have to go brick and mortar one or two locations in metropolitan areas that are just large enough for the concept and no larger.
Mr. Beast is trying to diversify because he knows the youtube career won't last forever, but he should have taken the billion and retired. sucks to be young and dumb
Didn't he learn from Trump's many failed licensing businesses that it's an awful idea to tie your personal name and reputation to ventures you have zero control over, even if the licensing fee for barely any work sounds sweet at first, it can backfire REAL quick.
When it comes to evaluating influence, there's always at least two variables to consider, the volume and value of the audience. He might have outrageous volume, but such a wide new will undoubtedly pull in low, no, or even negative value targets (from the advertiser's perspective). This is why YT channels see such wild swings in CPM. Like a modest 100K finance channel that attracts an older, more affluent audience would likely outperform a gaming channel targeting kids. MB's product stack cannot and will not advance beyond the simples, cheapest consumer goods. So he's starting at the bottom, has a clear ceiling, and the market will always race lower over time.
Hmm, this analysis assumes the high-volume low-value audience approach would remain static. In that case I would agree without much doubt. I do not know MRB's channel well, but it strikes me as entirely static indeed. But MRB's brand equity appears to be very strong, and in that case premium pricing for ads and even basic goods can become very realistic. Such as expensive crappy hamburgers. Also, I do not see how a strong brand could be negated by mere competition alone, assuming a "drastic change in times" won't occur. The real enemy of a strong brand is the brand itself, for example a lack of willing to adapt when needed.
Jimmy looks so tired. His fake, soulless smile is getting more empty on every new video thumbnail. Probably should of just taken the billion (if that was even true)
In deals like this, before signing, you go to a big law firm to receive consultation by a specialized lawyer or even lawyers (food chains/trademark law). Yes, you will pay around 30 k and more in lawyers fees, but you will not end up with a contract which is negative for you or cannot cancel (exit clauses). Hell, I would probably have made a better job than whoever consulted him and I am not even that specialized.
The key difference here is Mr Beast controls the content of his channel. He has virtually no control over thousands of independent burger chains making a hamburger. A hamburger is also a bargain basement commodity, an item that can be easily replicated by anyone. You can't replicate a video of a Lamborghini being shredded, but you can replicate his burger to within 99% of the real thing. Moving into cheap commodities was a mistake for Mr Beast.
When you want to sell products using your fame you should make simple products like energy drinks or chocolate as they are easier to scale and control the quality.
In that analysis you did of his profit off his videos, you failed to take in account the compounding of the views over time. Yes they video has 122million views right now; but it will have much more in another year. There’s also cheap videos he’s done in the past that still rack up millions of views 7 years later. You also didn’t take in account his revenue from his other RU-vid channels. He posts the same videos in different languages that get millions of views. Also he has his gaming channel and react channels which cost virtually nothing to make and still get crazy views.
His chocolate is releasing in my country soon. it's 2.5 times more expensive that other brands of chocolate. It's going to be another prime fiasco. Where it sits on the shelves until it's heavly discounted.
TBH I tried Beast burger multiple times because of family. Im a burger guy but Im not a fan... Edit: This is my personal opinion on the product. Not to offense anyone anywhere.
I have watched zero Mr Beast videos ever. Obviously I am long aware of an internet personality with that name, but have no interest in being one of his tens of millions of 'followers'. Nor do I watch TikTok or RU-vid shorts.
I never heard of Mr. Beast and I can't remember any IPO or SPAC. But making Burgers worse than McDonald's isn't an easy challenge and investing into a low margin food business isn't a smart move as well.
None of this apply: MrBeast's venture was a partnership with Virtual Dining Concepts, leveraging existing restaurant infrastructure. An IPO may have been an option (may), if VDC would have had expanded its company. And a SPAC has nothing to do with this: VDC isn't a SPAC.
Jimmy got Willy Wonka syndrome and thought everyone would love him and work hard to make sure he was happy and not do anything to hurt his precious brand
Got it delivered not knowing it was a bulls*hit virtual brand. It was worse than I can even explain. I got my money back, which I know comes from the restaurant.
I’m amazed at how popular this guy is. I mean, awesome for him…. But I’ve literally never seen a video of his and only hear about him on sites like this
Influencers brands are only ever good for short term gains. I recognize a small handful have somehow persisted, but generally they all blow up fast, but implode even faster.
If your young enough to make millions, you're old enough to take bad business agreements. Blaming on age is lame. Mr Beast is more concerned about views than the business. Speculation is Mr Beast is not that well off.
> if the quality was so bad, why did it took him so long to figure it out? Easily hoped he can make it right by negotiating stricter controls with virtual dining at first (probably getting just tons of empty promises), trying to overtake parts of the deal, or even shifting from virtual dining to brick and mortal at later stages. Only after nothing worked it was time to cut loses, connection with the rest of his brand, and find a legal way out. The same as staying too long in a bad relationship.
I am amazed so many people who watch this channel not only seem to know him, but are white knighting for him in the comments and justifying an even higher price for his channel of over $10B. I thought his market was young, daft children.
The countersuit is laughable. A good judge / good jury would instantly acknowledge that Mrbeast did his part while virtual dining did nothing but sacking in millions.
Ghost kitchens/virtual restaurants has to be the dumbest idea I've ever heard of. No control over quality at all. It's like they took all the bad aspects of Uber and applied it to virtual fast food.
I don't watch Mr. Beast, so I don't know what value he offers as an entertainer and why he is popular. But I will say that he has a very creepy smile. By the looks of him, I wouldn't trust his word if he told me the sky is blue.
Marketing 101: It's your marketing that gets the customer into the door the first time. After that it's the perceived value that keeps them coming back. Mr Beast got the first part right, but dropped the ball on the second part.
Mr Beast is motivated by greed he signed a deal that he was not happy with and wanted more $$ and also his deal with Beast burger meant he cannot move into food items..
I believe there is contract restriction in licensing his name to other restaurants or promoting them. Could also apply to frozen foods and fast casual food but things like appetizers (chocolate) might be an exception.
Ghost kitchens that will not get their name and location traced back to their food, no quality checks and control, but has to bear all the cost and give portion of revenue to this third party branding and marketing company. Who would have thought they would cut corners and increase profit margin at expense of quality.
Your math is sus. Each mr beast video has a different cost/benefit ratio; not all of his stunts cost 2 million dollars to run. You can’t take one stunt and assume all others have the same profit margins.
I honestly can't understand buying a burger because it's attached to a RU-vidr's name. I mean, okay he makes entertaining cute videos. But hearing his name doesn't make me want to go out and buy anything whatsoever.
The Mr beast corporation can’t be worth 1 billion, it’s worth 0. The only major asset is the intangible likeness of him. He also doesn’t want anyone else to have creative control.
I generally enjoy the content on this channel, but I've noticed that advertisements are integrated into the main content without clear demarcation. It would improve the viewer (mine lol) experience if ads were separated or clearly labeled, perhaps with designated chapters.
If I did this I would buy a small burger chain and re-brand it there are hundreds of small burger chains in the USA. My favorite is Dick's drive in here in Seattle, great burgers and they are expanding very quickly and long waiting lines.
<a href="#" class="seekto" data-time="670">11:10</a> lets assume beast burger received a 20% royalty !?!?!!? WTF Look up what other brand names far far bigger than this crap pay its 4-6% that makes the revenue 4-6 million thats it.
Bruh The MrBeast channel is not the cash cow channel. There are many more, much more profitable channels like BeastGaming and BeastReacts that make money.
This whole ordeal just makes Sam Hyde's MrBeast parody video, where he battered and deep-fried $5,000 worth of Marvel Funko Pops (as well as a dead mouse and human feces), even funnier.
Good job on this one Ryan, it’s interesting to see both sides of the story here but I’m sure the “Mr beast burger” won’t be his last thing to sell to little kids, hope he’s smarter with the contract next time
I think to a third-party investor, the value of his channel is $0, because all of the value is in Mr Beast himself, and you can't buy that. You can buy the RU-vid account password, but if you put other stuff on it that doesn't feature Mr Beast, people will quickly unsubscribe.
I only ordered Mr. Beast Burger once and hated it. Instead of smash patties I had 2 large patties in the burger and it tasted bland. My personal experience was negative
Just now learning about this business model, how could it not be trash? People go to chain restaurants for consistency, not quality. We all know the food in a chain restaurant is going to be trash but it's going to be the same quality level of trash, with similar ingredients and flavor profiles, every time. You're telling me some random ghost kitchen, that may have seasame seed buns, may have plain buns, may have brioche buns ... maybe they use this kind of lettuce, or that kind of lettuce, maybe the chef understands how to cook a burger properly, maybe they're just learning, who knows? It's worse than just having "the good McDonalds" and "the bad McDonalds" in your neighborhood. At least in a McDonalds the machines they're forced to buy and install all have timers and sensors that control the timing and temperature of EVERYTHING. In some random ghost kitchen? Who the hell knows. I only worked in fastfood for like 6 months 30 years ago but that small amount of experience was enough to let me know this was instantly a bad idea.
predictable 👍 the very first thing that comes to mind after I hear the words “3rd party” is “quality control” but all thing considered, who buys food because it’s named after someone else? 😮 this is weird to me 😅
I actually liked Beast Burger at first. Never seen any of his vids, but heard the burgers werent bad and gave them a shot. Was like Five Guys but with buns that didnt just fall apart. Would get them every couple months or so. There was absolutely a point where they just fell apart and stopped being even remotely good
I was shocked at how bad the Feastables were. How do you mess up candy bars? They were hard like dark chocolate, not really sweet, and the flavor was just meh. They were about $1.66 per bar at Target, so not insanely expensive. But I just thought it would at least be a tasty treat.
