Corporate Partner Eric Perlmutter-Gumbiner and client Lauren Riihimaki (“LaurDIY”) shared their insights on trends shaping the evolving creator economy for LA Times Studios’ Creator Economy Trends Roundtable.

Below are Eric and Lauren’s excerpts from the feature:

Q: What are the biggest biggest financial and legal misconceptions creators still have about running their platforms as businesses?

A: Eric Permutter-Gumbiner

Many creators still think like earners, not operators. They treat income like a paycheck rather than business revenue. The biggest misconception is equating “cash in” with profit, without reserving for taxes, chargebacks and refunds, production costs and the real possibility of a sudden dip driven by platform changes. A related issue is pulling cash out for short-term lifestyle upside instead of reinvesting into the business: team, systems, owned IP, owned channels and product. That reinvestment is what builds durable, transferable equity value over time. On the legal side, creators often assume a template is “industry standard,” so it must be safe. In reality, it can quietly reallocate risk through expansive usage rights, exclusivity, indemnities and vague approval or revision language. Entity formation matters, but it is not a force field. Without clean contracts, separate finances, appropriate insurance and basic governance, the liability shield is thinner than most people expect.

Q: How has the creator economy evolved from a “side hustle” model to a structured small-business category in 2026?

A: Lauren Riihimaki

Having built my career as a full-time creator over the past decade, I’ve experienced the evolution directly. I think there are three key shifts that have led to the progression from “side hustle” to small business: monetization, infrastructure and audience behavior. Brands are allocating and deploying serious, recurring budget into their advertising spends. Creator marketing is no longer considered an “experiment” or a high-risk investment; creators have proven to drive real ROI, and the industry has taken notice. Just as importantly, the infrastructure has caught up. Creators now have access to a full ecosystem of platforms, tools and services that support everything from monetization to operations, making it possible to run and scale a business, not just create content. And lastly, the audience. Attention is fragmented, and in a world of content overload and AI slop, people are seeking more specific and authentic, niche content, allowing creators to build highly engaged communities around very focused interests.

Q: Are we seeing more creators formalize as LLCs or corporations? What’s driving that shift?

A: Eric Permutter-Gumbiner

Yes, as creator revenue becomes more predictable and multi-channel, more creators are formalizing to manage risk, taxes and day-to-day operations. The drivers are practical. First, it limits personal liability as audience size and public exposure increase. Second, it creates a structure that supports hiring, vendor relationships and clear IP ownership. Third, it signals professionalism to brand partners, lenders and collaborators. It also forces separation between personal and business finances, which becomes essential when income streams include licensing, product lines, digital assets, live events and international payments. The broader thesis is that good structure creates something more durable than a personality-driven income stream. It creates an asset that is easier to package, diligence and ultimately sell, because the contracts, IP and financials live in a clean, transferable business.

Q: How have revenue streams diversified beyond brand deals – subscriptions, licensing, equity partnerships, live commerce, AI monetization?

A: Lauren Riihimaki

I’ve explored a wide range of revenue streams beyond traditional brand deals, everything from licensing and merchandise to live experiences. What’s become clear is that there isn’t a one-size-fits-all model; the right mix depends on the creator’s platform, content formats and audience. That said, ownership has become a major focus for me. I’ve made angel investments in brands I believe in, contributing content, capital or consulting in exchange for equity. And after several years in licensing, I found myself wanting more control, both creatively and financially. That’s what ultimately led me to start my own brand (dog lifestyle brand, Fuzzboy Originals). It’s a shift from participating in other businesses to actually building one.

Q: What are the biggest contract pitfalls creators encounter in brand deals or platform agreements?

A: Eric Permutter-Gumbiner

The pitfalls I see most often are pretty consistent. First, “usage” rights that are far broader than the deal economics justify, especially perpetual, worldwide, all-media grants. Second, sloppy deal terms around deliverables, approvals and revision cycles that create endless scope creep. Third, exclusivity that looks narrow on paper but functionally blocks other categories of revenue. Fourth, morality and termination clauses that are drafted as a one-way option. Creators also get squeezed on payment terms, long net periods, payments tied to subjective “approval” and “makegood” obligations that shift campaign risk onto the creator. A big one that gets missed is IP. Brands may try to own raw footage, concepts or derivative content. The fix is not complicated, but it has to be intentional: define scope, term, channels, usage, approvals and ownership, and make sure the remedies match real-world business outcomes.

Q: In your view, is the creator economy here to stay?

A: Lauren Riihimaki

Yes, absolutely. My 14 years as a content creator is a testament to the longevity this career can have, and I think it’s only gaining momentum now that the industry and infrastructure have caught up. Audience behavior also reinforces that staying power. People are increasingly seeking connection and community, and creators are uniquely positioned to provide that. While there’s a lot of conversation around the algorithm and the mysterious ways it works, I’ve found that platforms are actually getting better at surfacing content to the people who genuinely care and want to engage. All of those elements working in tandem is what makes the ecosystem sustainable long-term.

Q: What legal protections should creators have in place as they scale into multi-person teams or launch product lines?

A: Eric Perlmutter-Gumbiner

At a minimum, creators need a real legal foundation that matches how they operate. First, a clean IP ownership chain so it is clear who owns the content, trademarks, product designs and customer data. Second, written agreements with contractors and employees that cover confidentiality, IP assignment, work-made-for-hire where appropriate and clear policies for social and media access. Third, brand and trademark protection early before the business has real momentum and disputes become expensive. Fourth, insurance that fits the actual activity, including general liability, media risk and product coverage if you are selling anything physical. Fifth, compliance basics, such as advertising disclosures, privacy practices for email and SMS lists and solid customer terms if selling direct-to-consumer. The point is to eliminate single points of failure as the business grows beyond one person.

Q: Looking ahead, what will separate sustainable creator businesses from those that burn out in the next three to five years?

A: Lauren Riihimaki

It comes down to adaptability, business discipline and genuine creative longevity. The creators who last are the ones who can continuously evolve, adapting to shifts in content formats, platforms and audience behavior without losing their core identity. At the same time, sustainability requires treating it like a real business: building the right team, understanding operations and creating systems that support long-term growth. Early on, creators are wearing every hat, from creative to legal to financial, and that’s where many burn out. The ones who succeed are able to balance the art of creativity with the realities of running a business and eventually transition out of doing everything themselves into building infrastructure around them. That evolution is something I’ve experienced firsthand. In 2012, it was just me, a laptop, my webcam and accounting software. Today, I’m supported by a full team – business management, legal, agents and managers – and that infrastructure is what allows me to spend more time focusing on the creative.

Q: What structures best protect creators’ personal assets as their public exposure increases?

A: Eric Permutter-Gumbiner

Start with actual separation. Use an entity that owns the business activities and IP, run everything through separate bank accounts, keep disciplined books and sign contracts in the entity’s name. Then backstop it with the right insurance for what you really do, including general liability, media liability, cyber and privacy, and product coverage if you are selling anything. From there, be intentional about IP and publicity rights. In many cases, the cleaner approach is for the creator to license name and likeness rights to the operating company on defined terms, rather than having everything live personally and informally. Finally, put basic risk guardrails in place: review higher-risk campaigns before posting, document disclosure practices and have a consistent process for disputes, takedowns and claims. Asset protection is not one magic document. It is structure plus habits, applied consistently.

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