July 11: Investment Memo: YouTube

Rationale of why Sequoia invested in www.youtube.com in 2005.

Source: TechEmails
Published: February 2022

Investment Memo: YouTube

In 2005, Roelof Botha from Sequoia Capital (a VC fund) wrote an investment memo proposing an investment in the seed round of youtube.com.

Company Purpose: To become the primary outlet of user-generated video content on the internet. Allow anyone to upload, share, and browse this content.

Problem: Video content is currently difficult to share because video files are too large to email or host on your own website.

Solution: Customers upload their videos to YouTube. YouTube takes care of serving the content to millions of viewers.

Sequoia invested $1 million, followed by a $4 million Series A. Google acquired YouTube a year later for $1.65 billion, netting Sequoia $500 million, or 57x its investment.

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