BackgroundBased in San Mateo, YouTube is a small privately-funded company with 60 employees. Chad Hurley, one of its co-founders, serves as the CEO with its other two co-founders Steven Chen, CTO, and Jawed Karim, Advisor. So far, the company has raised over $11 million of funding from Sequoia Capital, the firm who also provided initial venture capital for Google, Yahoo and Apple in their early days. Their tagline is "Broadcast Yourself" and this largely represents their goal.
HistoryYouTube was founded by three former PayPal employees, who, witnessing the boom of online grassroots video, realized the need for a decent service that made the process of uploading, watching and sharing videos hassle-free. They registered the domain YouTube.com on February 15th, 2005 and developed the site over the following months from a garage in Menlo Park. In May 2005 they launched in a public beta, and in November, YouTube made its debut with an $3.5 million of funding from Sequoia Capital.
To get a decent start and attract the initial crowd they were looking for teenagers, college students, hobbyists, film-makers they came out with a contest that promised to give out one iPod Nano to a random member each day, which ran for two months. This contest worked on a point-based system, for example one point was rewarded for signing up, one for inviting others, another one for posting a video, etc. The more the points you gained, the higher the chance of winning you had. This was a significant action that got YouTube noticed by the masses and gave it a headstart as per the signups.
Now, after being the host (and former-host) of countless SNL segments, Superbowl ads, TV goof-ups, and home videos, it is the world's fastest growing website right now.
BusinessThe service is completely free for users, the company's business model, which was put in place in March 2005, was based on traditional banner advertising, sponsorships, partnerships and promotions, and even contextual advertising. So far, they've had numerous partnerships with traditional media companies, like NBC and the Warner Music Group.
YouTube has had to take several videos down to settle matters, most notably the SNL skit Lazy Sunday over NBC's request.
Ever since it began, the company has had a strong goal to build a community rather than to make a lot of money. But with the growing phenomenon, now with more than 65,000 uploads daily and 100 million videos being watched, they've had to kick-start their business plan in-order to sustain the growth.
Director MembershipUsers can join with different types of accounts, one is a Director membership. By signing up for a Director's Account, you essentially become YouTube's content partner. Along with a 'Director' tag, you get to co-brand your logo, link to a URL and provide your company's description on each of your videos. You also get the ability to upload videos longer than the 10 minute limit they've set, and customize a lot of fields and values. The program is aimed at amateur film-makers and online content distributors alike.