How Much Does Linus Tech Tips Make THE BREAKDOWN

[WillOfTheLand]

This started as a comment on the youtube video when somebody was indeed complaining they didn't know the exact amount, and then spiral'd into this after somebody made a reddit post and remembering a reply somebody had made to me about taxes on youtube. That said I don't actually care and this was just me geeking out over math for a solid hour and after having put in that much work felt I didn't want it all to disappear into the void that is a mostly ignored reddit thread never to be seen again, so I'm posting it here. The first part is just a straight copy/paste from youtube.

 

Did the math for you. From the WAN show we know LTT does about the usual $1 from 1000 views, given the odd exception because something might be brand related and get certain ads directed to it.

So with LTT at 1 billion views a year=$1 000 000 a year in ad revenue. Put that at 26% of total revenue that's just under $4 000 000 a year in revenue, ignoring the other channels. Add in the revenue from other channels you've probably got at least another half billion views all of them combined (lowballing) so likely between $4 500 000 and $5 000 000 a year in revenue. There now people can stop guessing.

 

 

This is of course, ignoring taxes, knowing what I do about how tax brackets work, and also living in canada we can say roughly 15% of LTT's revenue goes to taxes, assuming linus has done the taxes for the business correctly. Assuming it's at the $4 500 000 mark for their revenue that's $675 000 in taxes, bringing after taxes revenue to just under $4 000 000 or $3 825 000.

 

Now onto costs, running a business costs money. Assuming the LTT warehouse is about 20 000 square feet it's probably costing them around $500 000 a year to rent. That's $3 325 000 remianing. 

 

Move onto power they're probably spending $10 000-$15 000 on power, that's $180 000 a year, so we're at $3 145 000 left.

 

Let's move onto staff shall we? Assuming linus pays his staff well (at least compared to the rest of canada) let's assume they're making $60 000 a year each at what looks to be 30 or so staff (they're always hiring).  That's $1 800 000, we're down to $1 345 000.

 

Now we move onto upkeep, constantly attaining new equipment, training, software licenses, maintenance on current hardware (The Vault/servers, etc), spending on shoots, travel, buying stuff just for shoots (let us not forget the massive bounties he puts out on rare hardware) You're probably looking at another $500 000, so now we're at $845 000.

 

Tack on insurances and general amenities (pizza parties for staff, weekend retreats for them, christmas bonus's and nat) with all that expensive AF equipment you're looking at probably another $400 000 a year in expenses.

 

End it off with what him and yvonne take home that's $425 000 split between the 2 of them and after personal taxes in BC canada you're looking at about $170 000 for each of them.

 

Sorry if this crossed any lines (LTT staff/linus&yvonne) I geeked.

[Master Disaster]

You basically plucked 78.4% of your numbers out of thin air. You have no idea how much rent is, how much bills are, how much overhead is, how much buying the equipment needed costs, how much he pays his staff, how much tax he pays etc.

 

Assuming your initial figure is even close to accurate the rest of your numbers may as well have been picked by shooting pieces of paper falling through the air with a BB gun until one gets a hole in it.

 

His personal net worth is estimated to be $2.5m by people who actually do this stuff for a job but as he said in the video, the simple fact is, its non of our damn business and will remain that way until the day he decides to float LMG on the stock market (and even then his personal affairs are still non of our business).

[WillOfTheLand]

26 minutes ago, Master Disaster said:

You basically plucked 78.4% of your numbers out of thin air. You have no idea how much rent is, how much bills are, how much overhead is, how much buying the equipment needed costs, how much he pays his staff, how much tax he pays etc.

 

Assuming your initial figure is even close to accurate the rest of your numbers may as well have been picked by shooting pieces of paper falling through the air with a BB gun until one gets a hole in it.

 

His personal net worth is estimated to be $2.5m by people who actually do this stuff for a job but as he said in the video, the simple fact is, its non of our damn business and will remain that way until the day he decides to float LMG on the stock market (and even then his personal affairs are still non of our business).

You know you made me realise something, I fucked up my equations, I did this all in canadian dollars and costs. That's fine for the costs but for the income that's wrong because if I recall adsense pays out in USD and the store sells in USD, safe to assume sponsors also pay in USD, the revenue before taxes is a bit more, and the take home of the staff is probably more as well, but aside from that, no these were all based on actual knowledge of costs and a few quick lookups for local costs for them, since I'm on the literal opposite side of the country from them.

I won't do any arguing with you if you want to pick it apart but I will thank you for making me realise there was a error, I'm not going to go back and fix it because I don't really care (it was one of those in the moment sort of things) and you should know net worth does not = personal bank account.

[3 Lions]

1 hour ago, WillOfTheLand said:

End it off with what him and yvonne take home that's $425 000 split between the 2 of them and after personal taxes in BC canada you're looking at about $170 000 for each of them.

I wouldn't go too deep into it. All you really need to know is that they both earn enough to live on within their means and enough for Linus to keep LMG running in a financially healthy state. 

[Arika]

i never understood the obsession people have with knowing how much other people make.

 

LMG is profitable and therefore wont be strapped for cash unless something drastic happens, that's all that matters.

[eeeee1]

they say curiosity kills the cat

[WillOfTheLand]

22 minutes ago, Arika S said:

i never understood the obsession people have with knowing how much other people make.

 

LMG is profitable and therefore wont be strapped for cash unless something drastic happens, that's all that matters.

The main reason I did it (with the breakdown) was to dispel the myth that youtubers are rich. Maybe if you're a solo act and selling out to every person you can (we all know the channels) otherwise they are decidedly not rich. The first paragraph was just 30 seconds of curiosity during the video. The rest was just me simply hating that people assume because you're running a successful business you're absolutely loaded. Shit costs money and that's just all there is to it. While linus is certainly getting along, he gets way to much uncalled for flack from people who assume he's "ballar hallar get dollar" because LTT is susccesful. The main take away people should take from it is LTT is doing alright. The math may be off because these were just quick and based off personal experience (I worked retail for 7 years and some of those years of having to worry about these very kinds of numbers when running a business, overhead can be huge) as well as quick lookups of costs on their side of the country but should be in margins close enough to give people a idea of what it's actually like to run a business, it's not all fun and big paycheques.

With that I'm done, I'm tired for the night and I usually don't give anything I've posted attention past the next day, if anybody wants to move the numbers around to make it more accurate or just straight up slander me for having a bit of fun with math (some of us just enjoy this stuff for no damn reason, it's just like seeing how high a score you can get in 3DMark with a OC, it's just fun to us) while trying to show people who want to get into things a bit of reality, they can.

[RhysMusique]

I dont care what LMG makes as long as

1) Its employees are fairly paid with their wages

2) Its employees are looked after by the company in the workplace 

3) LMG can continue to grow and keep on as it is

4) Linus can reward himself for being a down right workaholic for the past 10 years, getting this channel/group of channels where they are today.

5) Linus and his family can live a comfortable life and his kids can go to college, not have to worry about money too much.

[SansVarnic]

@WillOfTheLand conjecture will only get you so far, watch Linus' video on how he makes his money.

He doesn't reveal exact numbers but as he said, its no ones business but his own.

[Kisai]

5 hours ago, Arika S said:

i never understood the obsession people have with knowing how much other people make.

 

LMG is profitable and therefore wont be strapped for cash unless something drastic happens, that's all that matters.

Knowing how the sausage is made often dissuades people from making their own sausage.

[Morrie Sells Wigs]

What he makes and spends is his business...literally. 

[RejZoR]

What difference does it make ultimately? If Linus makes good living out of his business and his employees earn good money and also live good and it's all set to be sustainable long term, that's all I need to know about it.

[foldingNoob]

my grandfather ran his engineering business for 69 years. He taught me a simple formula. For the money coming in, 1/3rd goes to staff including your own salary, 1/3rd goes to various taxes, 1/3rd must be re-invested back into the business. I have seen how Linus wretches when discussing video budgets I am sure a successful man will have a formulated fiscal structure like this. BTW I have seen employers not invest and treat their business like a personal cash account and those are really bad people to work for.

[skywake]

TBH I only care to the extent that, as the video implied, LTT being financially independent makes it harder for them to be brought. I mean I also don't really care that much how "biased" they might or might not be because for most of LTT's content the video is just a "here's a tech thing, isn't that neat". And often it's not even something particular to a specific product. Absolute worst case there I'm being advertised to rather than being given an independent point of view. Which is kinda gross but far from the end of the world for a channel that when I started watching it was literally just a dude reading the bullet points on the product box.....

With that said, occasionally the current LTT wanders into topics where I think editorial independence matters more. The video on WD selling SMR under their WD Red line comes to mind. Where it's less about highlighting a product/use case and more about highlighting some sketchy goings on. You can imagine a scenario where a smaller channel more dependent on money from WD, not unlike LTT from several years back, might be less willing to do a video like that. And that's where this matters.

 

Beyond that? Really, I couldn't care less how much they're making from LTT store. Frankly the more they make the better

[Master Disaster]

9 minutes ago, skywake said:

TBH I only care to the extent that, as the video implied, LTT being financially independent makes it harder for them to be brought. I mean I also don't really care that much how "biased" they might or might not be because for most of LTT's content the video is just a "here's a tech thing, isn't that neat". And often it's not even something particular to a specific product. Absolute worst case there I'm being advertised to rather than being given an independent point of view. Which is kinda gross but far from the end of the world for a channel that when I started watching it was literally just a dude reading the bullet points on the product box.....

With that said, occasionally the current LTT wanders into topics where I think editorial independence matters more. The video on WD selling SMR under their WD Red line comes to mind. Where it's less about highlighting a product/use case and more about highlighting some sketchy goings on. You can imagine a scenario where a smaller channel more dependent on money from WD, not unlike LTT from several years back, might be less willing to do a video like that. And that's where this matters.

 

Beyond that? Really, I couldn't care less how much they're making from LTT store. Frankly the more they make the better

I fully trust that if Linus has an issue with the way a company does something, partner or not, he will damn well call them out on it anyway.

 

He has done exactly that many times in the past, the biggest example I can think of offhand would be his rant about Intel after CES a few years back. Imagine the damage it might have done to LMG if Intel stopped sending them products to review and sponsored items to use in videos etc. It would have been catastrophic yet he made and released the video anyway.

[Morrie Sells Wigs]

9 hours ago, WillOfTheLand said:

The main reason I did it (with the breakdown) was to dispel the myth that youtubers are rich. Maybe if you're a solo act and selling out to every person you can (we all know the channels) otherwise they are decidedly not rich. The first paragraph was just 30 seconds of curiosity during the video. The rest was just me simply hating that people assume because you're running a successful business you're absolutely loaded. Shit costs money and that's just all there is to it. While linus is certainly getting along, he gets way to much uncalled for flack from people who assume he's "ballar hallar get dollar" because LTT is susccesful. The main take away people should take from it is LTT is doing alright. The math may be off because these were just quick and based off personal experience (I worked retail for 7 years and some of those years of having to worry about these very kinds of numbers when running a business, overhead can be huge) as well as quick lookups of costs on their side of the country but should be in margins close enough to give people a idea of what it's actually like to run a business, it's not all fun and big paycheques.

With that I'm done, I'm tired for the night and I usually don't give anything I've posted attention past the next day, if anybody wants to move the numbers around to make it more accurate or just straight up slander me for having a bit of fun with math (some of us just enjoy this stuff for no damn reason, it's just like seeing how high a score you can get in 3DMark with a OC, it's just fun to us) while trying to show people who want to get into things a bit of reality, they can.

You "dispel the myth You Tubers are rich" by suggesting he's taking home hundreds of thousands of dollars a year, plus overseeing his own business which has assets and turnover in the millions?

 

Saying someone is "rich" is about perspective - as it's all subjective, isn't it?

 

What I would consider a rich person may be very different to what someone else might think. 

 

To the average person a guy earning 2 million a year is rich.

 

But, to Bill Gates it's not even enough to feed his pets for a year.

 

It's all relative.

 

Plus, a person can be frugal and give off the appearance of poverty and be very well off - like those people who die and leave millions to a cat sanctuary while they lived in a cold, damp house.

 

Or, they can appear cash rich but have no assets, no property, and be flat broke in a year.

 

Ultimately, Linus is like any businessman who has put in the hours, built something with hard work, brought in collaborators and like minded associates, grew it into a profitable company, and is now reaping the financial benefits. 

 

Good luck to him, I say.

[skywake]

@Master Disaster

Don't get me wrong, I wasn't suggesting otherwise. And frankly being able to do that kind of video is precisely where I think financial independence for a media organisation matters most. I was just saying that for say..... "RTX 3090 8K Gaming - First in the WORLD!!111"? It doesn't really bother me as much. Actually, turns out that video was sponsored by NVidia and I don't even remember it being sponsored. Couldn't care less because, frankly, I expect a channel into tech to geek out about bleeding edge tech.

 

@Maury Sells Wigs

I mean, that's true. But as someone who doesn't at all buy into the world view that train of thought takes you down I'd add this large footnote. If success is a combination of luck and hard word then, by definition, all people who are successful were both lucky AND worked hard. The trap is that for people who find themselves in that position it's VERY easy to dismiss the luck part of the equation because working hard was the bit they had control of.

 

Basically what I'm saying is.... I agree with you but I'm not a fan of the reverse side of what you're saying. No doubt successful people worked hard for what they have. But there are also plenty of people who worked just as hard and got nothing for it. There's a correlation between success and hard work but there are also a lot of other variables out of your control.

[Morrie Sells Wigs]

Just now, skywake said:

@Master Disaster

Don't get me wrong, I wasn't suggesting otherwise. And frankly being able to do that kind of video is precisely where I think financial independence for a media organisation matters most. I was just saying that for say..... "RTX 3090 8K Gaming - First in the WORLD!!111"? It doesn't really bother me as much. Actually, turns out that video was sponsored by NVidia and I don't even remember it being sponsored. Couldn't care less because, frankly, I expect a channel into tech to geek out about bleeding edge tech.

 

@Maury Sells Wigs

I mean, that's true. But as someone who doesn't at all buy into the world view that train of thought takes you down I'd add this large footnote. If success is a combination of luck and hard word then, by definition, all people who are successful were both lucky AND worked hard. The trap is that for people who find themselves in that position it's VERY easy to dismiss the luck part of the equation because working hard was the bit they had control of.

 

Basically what I'm saying is.... I agree with you but I'm not a fan of the reverse side of what you're saying. No doubt successful people worked hard for what they have. But there are also plenty of people who worked just as hard and got nothing for it. There's a correlation between success and hard work but there are also a lot of other variables out of your control.

Let's put it this way - you can work hard and not be successful, but you can't be successful and not work hard.

 

 

[Lord Vile]

4 hours ago, SansVarnic said:

@WillOfTheLand conjecture will only get you so far, watch Linus' video on how he makes his money.

He doesn't reveal exact numbers but as he said, its no ones business but his own.

Did also say there’s enough info out there to get a reasonable estimate if you want to 

[skywake]

1 hour ago, Maury Sells Wigs said:

Let's put it this way - you can work hard and not be successful, but you can't be successful and not work hard.

True, but to be pedantic it also depends on your thresholds for hard work and success. Anyways, this video does a better job explaining the maths I'm on about:

 

[Morrie Sells Wigs]

4 minutes ago, skywake said:

True, but to be pedantic it also depends on your thresholds for hard work and success. Anyways, this video does a better job explaining the maths I'm on about:

 

Well, it's a rare person who can become successful in a given field without dedication and effort...i.e hard work.

 

I mean, yes, I'm sure there are those rare people who can play guitar like Hendrix and never practice.

 

Or, hit a drive like Tiger Woods despite never practicing or putting in any effort. 

 

But, they don't reflect the reality for 99% of people. 

 

For them, it's quite simple - you work hard, you dedicate yourself, you try your best, you remain motivated and committed, and, with a bit of luck, you become "successful".

 

Whatever that actually means?

 

Presumably, it means financially secure...affluent even, to the point where you are referred to as "rich".

 

Of course, success isn't always about money...far from it...

 

...but, this has become rather philosophical in nature, so I'll shut up.

[Master Disaster]

1 hour ago, skywake said:

@Master Disaster

Don't get me wrong, I wasn't suggesting otherwise. And frankly being able to do that kind of video is precisely where I think financial independence for a media organisation matters most. I was just saying that for say..... "RTX 3090 8K Gaming - First in the WORLD!!111"? It doesn't really bother me as much. Actually, turns out that video was sponsored by NVidia and I don't even remember it being sponsored. Couldn't care less because, frankly, I expect a channel into tech to geek out about bleeding edge tech.

100% agreed and actually I'd go even further than that. Without sponsorship some of LMGs best videos might never have happened at all. Having sponsors is beneficial to all of us since it allows the team to get hands on with the exact stuff we all geek out about and Linus is fully aware that, if he is excited for something then most of us will be as well.

[skywake]

1 hour ago, Maury Sells Wigs said:

Well, it's a rare person who can become successful in a given field without dedication and effort...i.e hard work.

True, but as I said it depends on what level of success we're talking about. I think it's fair to say that everyone who's at the absolute peak of anything has worked very hard. But if success is a sum of hard work and luck then, almost by definition, the people at the absolute peak were also incredibly lucky. And by that same logic if you come down from the elite levels of success you'll start to see people who didn't quite work as hard but were just more lucky. And also you'll see people who worked harder than the people at the top but just didn't catch the same breaks (eg being born near a large NA PC retailer HQ and at the right time to be entering the workforce when YouTube was in its infancy)

 

Anyways, that's enough internet level pedantry for today. Probably worth watching the video I linked to rather than listening to me. It explains the maths/psychology it better than I could.

[Morrie Sells Wigs]

8 minutes ago, skywake said:

True, but as I said it depends on what level of success we're talking about. I think it's fair to say that everyone who's at the absolute peak of anything has worked very hard. But if success is a sum of hard work and luck then, almost by definition, the people at the absolute peak were also incredibly lucky. And by that same logic if you come down from the elite levels of success you'll start to see people who didn't quite work as hard but were just more lucky. And also you'll see people who worked harder than the people at the top but just didn't catch the same breaks (eg being born near a large NA PC retailer HQ and at the right time to be entering the workforce when YouTube was in its infancy)

 

Anyways, that's enough internet level pedantry for today. Probably worth watching the video I linked to rather than listening to me. It explains the maths/psychology it better than I could.

I know what you are saying, and what the video is about - I'm just saying we don't necessarily agree.

[Drama Lama]

13 hours ago, Arika S said:

i never understood the obsession people have with knowing how much other people make.

if someone has money and people don't know how they get it there will be speculation

It is just normal human behaviour. Just think how many articles there are which speculate about billionaire X's or celebrity Y's income and networth.