GRWM: Everything you need to know about the growing world of online influencers and the opportunities it presents for lawyers.
Whether it’s trends on TikTok, gaming streams on Twitch, or travel inspo on Instagram, you’ll find influencers on every social media platform. While Charli d’Amelio (TikTok dance sensation) and Khaby Lame (TikTok star turned Hugo Boss model) may not be household names, personalities like these have amassed enormous online fanbases that reach into the tens of millions. That level of internet fame attracts the attention of brands, labels, and advertisers.
And that’s what differentiates your average social media poster from the trending accounts that we can actually describe as ‘influencers’. “I see an influencer as really being anybody with a following who is using their social media account as a platform to promote goods and services,” says Vivek Jayaram, founder and partner of law firm turned culture agent, Jayaram. Ellie Heisler, entertainment lead & partner at Nixon Peabody, adds: “An influencer has to create content with the goal of growing their audience, attracting brand deals, monetizing, and successfully doing so.” At the crux of it is the monetization of their platforms – essentially a form of advertisement.
“There are so many entertainment spaces, and advertising has crept into all of those,” Frankfurt Kurnit counsel Dorian Slater Thomas tells us. According to Influencer MarketingHub, the influencer market was worth $1.7 billion in 2016. By the end of 2022, it had exploded nearly ten times over to $16.4 billion.
Enter your influencer attorneys. With money like that at stake, Whistler managing director David Soskin explains, “We are well beyond this being a handshake, and well into sophisticated lawyers negotiating this stuff.”
But how big does an influencer’s following have to be to warrant legal representation? In short, there are no set metrics. Take it from Thomas: “I’ve represented emerging influencers who may have less than 10,000 followers on a platform, and negotiated brand deals with the biggest influencers whose last names start with K.” It’s less about numbers, and more about the level of influence these personalities have over consumers.
“Being a talent side entertainment attorney was reserved for the select few who had inroads in those narrow fields.”
Breaking out
So, where has this lucrative industry emerged from? "Entertainment used to be very segmented – you'd have your film stars, your TV stars, your talk show hosts, your athletes, and there would never be any crossover,” Whistler managing director Josh Bilgrei tells us. “Being a talent side entertainment attorney was reserved for the select few who had inroads in those narrow fields.” Then came your Instagrams and your TikToks…
“I’ve been practicing for about 20 years, so half of my career has been in a world where there were only very nascent forms of social media; there wasn’t really an influencer market in the way there is today,” Jayaram explains. “Back in the day to get a lucrative film, print, or TV ad you really had to be an A or A-, or B+ celeb. Now, it’s a little more democratic in that anyone can have their 15 minutes, amass a huge following, and use that following to close on influencer deals.”
The influencer industry is still relatively young. From a legal standpoint, “there’s no precedent for how these deals happen,” Bilgrei tells us. “There’s nobody who’s an expert. Everybody’s sort of figuring it out as they go!” What we can do is draw comparisons (and contrasts) between influencer representation and traditional celebrity representation.
For starters, “it’s a much faster moving industry,” Heisler tells us. “It’s also ‘pandemic proof’ from the standpoint that you don’t need a third party to finance the content; you’re not relying on a studio or a production company or a financier.” Essentially, all it takes is a camera phone, an internet connection, and some creativity.
What’s more, Heisler adds, “Influencers are very in tune with their audience, so you have to listen to them in a way that you wouldn’t necessarily listen to a traditional celebrity. They’re hired for their expertise in creating content, but also in reaching an audience; they’re experts in marketing.” Many of the most successful influencers tend to operate within a specific market – think fitness, beauty, travel, and even mukbangs (SFW, just be prepared to explain if there’s a partner standing behind you). “You can find rabid fanbases in literally any vertical, and you can find people with huge, robust followings who are only followed by people in a certain industry,” Jayaram details.
Of course, influencer fame can be fleeting if you don’t stay on top of audience demand and trends, and your attorney has to be on the same page; as a lawyer who represents influencers, you’re going to have to trust that they know their audience and what content is going to gain traction.
“An influencer now is almost a piece of a traditional talents job, just because they’re getting so much revenue from those marketing dollars.”
Additionally, Jayaram highlights the FTC regulations that were enacted in 2009,“in an attempt to deal with this emerging area of influencer law.” These regulations target advertisers and provide standards for their endorsements. In essence, “an influencer now is almost a piece of a traditional talents job,” Thomas explains, “just because they’re getting so much revenue from those marketing dollars.”
So who’s qualified to get into this?
Breaking it down
Influencer representation sits at the convergence of many areas of law. “The unicorns are the people who are at the intersection of employment, licensing, and IP, with media or advertising-industry experience,” explains Soskin. Ultimately, Heisler advises, “you have to draw on your experiences as an attorney because influencer representation is new and evolving. You have to use your best judgment from prior experiences to apply to this emerging area.”
By way of example, Thomas recalls: “I’ve seen deals where Twitch has engaged well-known streamers and essentially asked for a full-time job – 160 hours a month of streaming, so eight hours a day, five days a week. If that’s the case, it’s useful to have an attorney who is experienced in reviewing and negotiating those deals on things like industry standards, hours and compensation, how often you have to break for advertising, or how many ads you have to serve per hour.”
For Jayaram, his entrance into the industry was fueled by his love of IP: “At the backbone for everything has been my passion for exploring the ever expanding and evolving parameters around intellectual property law.” In addition to understanding copyright, trademark, patent, and trade secrets, Jayaram highlights the importance of a strong grasp of NIL – name, image, and likeness. “Those things are not necessarily dealt with by the same statues, but they come spiritually or philosophically from the same place.” Simply put, “you really should not be going into an influencer deal, on any side, unless you have a working knowledge of the relationship between copyright and trademark law on the one hand, and NIL laws on the other.”
Thomas came into it from a slightly different angle: “I work in two groups at Frankfurt Kurnit: the advertising group, which works on all the deals necessary to create a commercial (whether broadcast, social media, or experiential), and the interactive entertainment space, which was traditionally video game development and that genre of entertainment.” He goes on to explain, “I was sitting at the right nexus where I had experience in these interactive forms of entertainment and experience in advertising. Influencers straddle those two spaces within the law.”
“IP and advertising are definitely really important, but the thing that attracted me to representing influencers is the entrepreneurial nature of being an influencer.”
Heisler began her career as an in-house counsel at a licensing agency. “IP and advertising are definitely really important,” she says, “But the thing that attracted me to representing influencers is the entrepreneurial nature of being an influencer.” As Heisler explains, it’s likely that you’ll be supporting them in all aspects of their work, such as:
Corporate law. That includes “setting up the entity that they loan out their services from, whether that’s an LLC or an S Corporation.” There’s also the drafting and negotiation of contracts, which can vary massively.
Employment. You’re advising on “hiring people on their teams, like videographers, photographers, editors, stylists, and publicists.”
Intellectual property and privacy. As well as figuring out who owns the content that influencers create, attorneys could be “building out their trademark portfolio, copywriting their work, and making sure their privacy policy and terms of use are up to date if they have a website.”
Tax. There’s a lot of cash involved and “influencers could be making money in different jurisdictions,” so you’ve got to “engage tax lawyers and CPAs to figure out the best structure” for your client.
Insurance. Given that influencers create their own content, “there could be different levels of risk assigned with that.” Basically, “you have to have an eye on the types of insurance they carry, or they should carry, what kind of coverage is available, and introduce them to insurance brokers.”
Crisis PR. “Oftentimes, they’re highly visible and litigation happens, whether they’re the ones suing, or the ones being sued.”
The other side of the coin is representing brands who are looking to engage influencers to market their products and/or services.
This is but a snapshot of what’s involved in practice. In reality, it’s impossible to create an exhaustive list of everything you’ll encounter day to day, but Heisler tells us the key takeaway is: “You get to be a part of writing the rules, and if you have an entrepreneurial spirit and you’re ready to jump into the unknown, there’s no better place to be. You have to be comfortable adopting certain legal principles in an area where they’ve never been tested, and then you have to be able to give advice on something that hasn’t yet been tested.”
Breaking in
Among the variety, one certainty is that a large chunk of your busy schedule will be dedicated to counselling. “Most of my day is spent talking with creatives, or founders of brands and helping them develop strategies for growth,” Jayaram details. “Oftentimes, that means commercializing their intellectual property, sometimes that means buying or selling a company, sometimes that means stopping somebody who is unlawfully infringing on your intellectual property.”
“You’re putting out a lot of fires on a daily basis.”
Other parts of your day will be stretched between negotiating (“There’s a lot of advocacy and a lot of time spent on the phone!” says Heisler), and a whole load of contract drafting. “When things fall apart, you’re also revisiting those contracts and seeing what leverage you have, oftentimes looping in a litigator for their perspective as well,” explains Heisler. Essentially, “you’re putting out a lot of fires on a daily basis,” she adds. This includes trolling and negative comments, as well as slumping brand deals and IP infringements.
In the background, successful influencer representation means keeping up with industry trades and new FTC decisions which clients need to be aware of. It’s also important to stay in-the-know about the different platforms your clients are engaging with and engage with potential clients online too. “So, if you want to be in this space, this is your license to spend those hours on TikTok!” Thomas jokes. “Try to end up in the same physical spaces, too,” he suggests. “Go to TwitchCon, Comic Con, VidCon. Go build that network of people in your life and they’ll turn to you.”
As far as location is concerned, “you’ll find that most lawyers representing these types of folks in the areas that have the biggest hubs for entertainment and tech lawyers, which are California and New York,” Whistler managing director Taylor Miller explains. Heisler also highlights Nashville as a growing market “especially with the crossover with music and influencer representation.”
Ultimately, “being in states where influencers live is helpful because you need to know state-specific laws,” she adds. “You’re not going to be stuck in LA or New York for your entire life, but if this is something you want to do then you should be prepared to spend at least a couple years of your life on either of the coasts,” Thomas concludes.
Breaking the fourth wall
Looking ahead, “I think you’re going to see more immersive opportunities for influencers to promote goods and services in virtual contexts,” Jayaram predicts. “I think we’re going to see influencers creating avatars and selling NFTs to their fanbase that are then tied into whatever brand deal the influencer might currently be doing, which may include physical goods and services IRL… That’s what gets everyone into the Metaverse!”
This is one way in which this market may continue to expand. “If you look back, it was unusual to make a bunch of money off social media,” says Thomas, “but now you’d be surprised if you tap into your network and realize how many people are making some kind of money, if not their entire income, off of social media, gaming, or some kind of interactive entertainment.”
As the industry grows, we’ll also begin to see further sophistication. “We’re already seeing influencers evolve the same way that traditional talent and TV and movies have evolved, to the extent that we’re now seeing agencies like talent representation for influencers only.” SAG-AFTRA, the US’ major talent union, also now allows influencers to join as members.
As well as moving in the same direction as the traditional talents industry, we’re seeing a sort of convergence of the two. “I think there’s going to be way more blending of what an influencer vs. a celebrity is,” says Heisler. “If you look at the Met Gala for example” - an event which used to be exclusively for A-listers - “even a few years ago, YouTube had their own table.”
If you’re looking to get a seat in this emerging industry, Bilgrei suggests boutique entertainment firms are a great place to start. “Boutiques are more likely to have flexible billing rates, which can be make or break when it comes to building your book," he advises. “You should also think about who the firm’s clients are and what industries they work in. Those are going to be your clients, and that’s going to become your world.”
