YouTube Receives $3.5M Funding from Sequoia

An anonymous reader writes "YouTube, the self-described "Flickr of video" has now received $3.5M in funding from Sequoia Capital, the same VC firm that funded Yahoo!, Google, and PayPal. Competitors of YouTube include Revver, launched just last month and founded by Ian Clarke of The Freenet Project fame. As of now, both services are free. With the online video space heating up in recent months, the question is who will discover the best business model." YouTube was first mentioned on Slashdot shortly after its launch three months ago.

Comments

So who are Sequoia?

[Audent]

And who else have they funded...? Surely there are a couple of other companies, or are they simply very good at picking future winners on the largest scale possible?

Re:So who are Sequoia?

[mridley]

They're a top tier VC in Silicon Valley. More info is on their web site.

Vobbo is Better!

[CuteVlogger]

Vobbo is better! More file formats, but you can use your own domain, make rss feeds for any search term, and embed videos in other annoying trendy sites :)

business model? isn't it obvious?

[idlake]

Their business model is obviously to be acquired by Yahoo!, Google, or Microsoft.

Clippy helped!

[Anonymous Coward]

/ You seem to try to fund your project.   \
| Mmh, it seems that your project doesn't |
| give any money! Fuck off and ask those  |
\ hippie money spoiling firms!            /
        \     ____
         \   / __ \
          \  O|  |O|
             ||  | |
             ||  | |
             ||    |
              |___/

The flickr of video?

[hubbah]

Why can't flickr be the flickr of video?

A large part of succeeding in this space will be about technology - there are storage and bandwidth issues aplenty. But if your users need to find someone who thinks prancing around the room with their polka-dot boxers on their head is funny or artistic or... original, they'll need community. And flickr has succeeded in building a community around images, where many others have failed. It's no small feat.

- Hubbah

Re:How dos VC works?

[FireballX301]

Hi. I'm a Venture Capitalist. I talk to you for a bit and decide you're worth my investment.

You now have a bunch of money from me, but you have either a debt obligation to me or have given me convertible stock options. I also play a role in your Board of Directors.

You have about 6 years to give me a return on investment before I pull the plug. In the meantime I will work towards your benefit because I want my money back.

After I pull out by converting and selling stock or calling in my debt, you should be a thriving company and I will have reaped a decent return on investment GIVEN that I did my job properly.

Here's the thing, though. youTube and Reever are theoretically competing entities. However, any schmoe can put down a few million on both. What that schmoe CANNOT do is take action based on insider information or engage in deliberate corporate espionage, and if the schmoe is a bit too friendly to one, the other will see him as a hostile investor. Think hostile takeover.

Re:Yahoo, Google, Apple, VA, etc

[Agrippa]

They also funded MP3.com with 12 million in early 99 and cashed out hansomely way, way, way before the bubble burst.

.agrippa.

Explained

[TubeSteak]

VC = Venture Capital = money to do stuff with

Sequia Capital = Company that gives out VC if you beg enough

Flikr = Photo sharing site that allows you to tag pictures in your gallery according to their content - this makes them easily searchable -

Yahoo: Yahoo bought Flikr a while ago

YouTube = video version of Flikr, UL your vids & tag them
http://www.youtube.com/profile_videos.php?user=cha irdiving

Revver = same thing as YouTube
http://www.revver.com/video/2367/

Why couldn't they call it MyTube?

[dougTheRug]

I *hate* software that's not called "My whatever".

How do we make money?

[Time Doctor]

Here at YouTube, we get a lot of satisfied customers, and some of them ask us how we stay in business and give away free bandwidth.

The answer is simple, volume.

Re:How do we make money?

[Time Doctor]

This joke was a reference to an old saturday night live episode wherein Phil Hartman explains that the customers at "Change Bank", a bank where all they do is give you change for other denominations of money makes money via "volume". Of course now that I've explained the joke it is no longer funny, you insensitive clod.

The obvious name should be

[commodoresloat]

iTube.

Missing the most important thing about Revver

[Sanity]

The important difference between Revver and the other sites is that Revver allows the creators of videos to earn money. They do this by giving video creators a 50:50 cut of the advertising revenue generated from the ads attached to that user's video. This approach is unique among the various "Flickr of Video" sites, and is pretty unique across other forms of media too.

This is very important, particularly if you consider the growing frustration of video creators as these websites make money from their creativity without rewarding them (see http://ebaumsworldsucks.com for a good example of this frustration).

I still don't really get Flickr

[DavidNWelton]

I put my photos up on the web, and give each one a description. For instance:

http://www.dedasys.com/photos/padova_inverno/

and you know what? People can find them just fine with google or google image search. And I get the adsense revenue myself. It's not much - maybe enough for a pizza for my wife and I every now and then, but hey, I'm not complaining.

So... what's so "fantastc abot Flickr"? Sure, it's nice for those who don't have their own web hosting space... I'm not trying to say it's bad, but I don't get the hype.