Influencer Management Agreements: Term: How long do they last?

Our third minisode of the seventh season of “The Creative Influencer” podcast is available today. This is the second part of our special series about Influencer Management Agreements. In this minisode, Jon starts our deep dive into the nuts and bolts with one of the most important provisions: the term. Although simple on its face, there are several factors to consider when setting the length of a Management Agreement.

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A transcript of the episode follows:

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This is the third minisode of the seventh season of The Creative Influencer podcast.  Today we start our deep dive into the nuts and bolts of influencer management agreements with one of the most important provisions being the term.

“Term” is legal speak for the length of the agreement. The term establishes the start date and end date of the management agreement. In other words, it establishes how long the parties are committed to working with each other.

This may seem like an extremely basic subject not worthy of a minisode but let me explain why it deserves attention.

First, there isn’t a governing body that establishes a recommended term for influencer management agreements. There aren’t Federal regulations or California statutes that govern influencer manager agreements. While management agreements are not generally thought of as service agreements, “A contract to render personal service … may not be enforced against the employee beyond seven years from the commence of service,” according to California Labor Code section 2855. This is one of the reasons why you never see a management agreement with a seven-year term.

Second, there are competing interests in the length for managers and influencers.

Many managers try to bind an influencer to their agreement for as long as possible. They argue that a longer term protects them for all the work they will put into the influencer’s career in the future. That is true but it is a one sided view of things.

The reality is that most managers won’t work with influencers with less than 1 million followers. It is rare for a manager to guide a micro-influencer’s career and help her grow from 10,000 followers to one million followers.  In other words, the influencer has already done a substantial amount of work to grow her career before a manager wants to work with them.

Creators typically want to sign an agreement for the shortest period possible. This lets them leave the relationship as soon as possible if it isn’t working out.

Keeping in mind these conflicting objectives, the term of the agreement is established by negotiation between the parties. An initial term is generally one to three years and sometimes as long as five years.

That’s quite a commitment. Especially when it is with someone the influencer hasn’t worked with before and doesn’t really know. The solution – a trial period. Influencers should insist on a trial period of at least three months or even better, six months.

A trial period gives a little bit of breathing room to the long-term enforceability of a management agreement. Think of a trial period as an extended test drive. The relationship between an influencer and a manager must be built on trust and trust is not built over night. Are any deals generated during the period? Does he return your phone calls? Do you feel comfortable when you talk to him? Do you have any reservations that you may not be a fit. This rarely gets better over time if there is a problem during the trial period.

So, after the trial period, the parties have agreed to work together. The creator is locked in for the term absent grounds for termination -- which we’ll talk about termination in minisode six.

If things are working, there is no reason for the influencer to leave. Time will fly by.

One additional detail to consider is whether there is an automatic renewal of the agreement. If there is automatic renewal, an influencer must give notice to the manager that they want to end the relationship. If notice isn’t given, the agreement will renew automatically. The length of the renewal periods should be given as much thought as the original term. Will it renew for another year, 2 years or 3 years?

If the management agreement doesn’t automatically renew, the influencer is back at where she started and has an opportunity to negotiate more favorable terms.

There you have it – the term.

In our next minisode we’ll talk about the scope of the manager’s representation of the influencer. What does a manager do and what are they contractually obligated to do?