YouTube’s two success “secrets”

by Mathew on April 5, 2007 · Comments

youtube2.jpgMeant to blog this earlier when I came across it, but a guy named Matt — a student at Stanford studying design and business — wrote a post the other day about a couple of special visitors who came to his class: Chad Hurley and Steve Chen, the co-founders of YouTube. Matt says that he had the good fortune to go out to lunch with the two new multimillionaires, and asked them what the keys to the company’s success were.

The answer is fairly succinct, and not exactly a secret either, but still worth repeating: the first key to success was the ability to embed video, and the second was an infrastructure that allowed the site to scale quickly and easily. Sounds simple, but the first was unique when YouTube offered it — and I would argue it was also by far the most important of the two factors — and the second is a lot harder than it sounds.

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  • Surely the other less appealing secret is that they happened to be two guys in the very lucky position of being in the right place at the right time. Lots of others came before - more visionary, but with unlucky timing. They did it just for kicks, at least at the beginning. Secret to success or just bell-curve probability plain lucky?
  • Mathew
    That's definitely true, Rob -- timing is important too. But I don't think it's any more important than those other two factors. If they had gotten the timing right but not had the embedding -- which made sharing easy -- or the scalability, I think they would have disappeared just like the rest.
  • The third factor of success was being the son-in-law of an ultra-connected venture capitalist. But they don't talk about that in the public relations. It ruins the myth of a few guys striking it rich by their bootstraps.

    "Their reluctance is understandable: Jim Clark is one of the valley's most revered figures, and because he runs a media-sharing website—Shutterfly, founded in 1999—it would be tempting to think he was the real force behind the video-sharing site his son-in-law was starting. But Chad says Clark has had only a tiny role in YouTube, merely offering the boys advice in 2005, when the start-up was seeking its initial round of funding. "

    Yeah, right. A super-rich father being "only a tiny role". Not even worth mentioning ...
  • Mathew
    Did Jim Clark help them get money, Seth? I don't see why just being his son-in-law means Chad would be guaranteed to have success with YouTube -- it's not like everything Jim Clark has touched has turned to gold. If he was the one who told them to allow embedding, then maybe I'd be willing to give him some of the credit.
  • Did I say *guaranteed* anywhere? That would be silly. Nothing in venture capital is guaranteed.

    But if you're going to argue that having a super-rich, ultra-connected, venture-capitalist father-in-law who in fact tried the same business earlier isn't a factor, well, I think that's an utter denial of social reality.

    It just doesn't make for nearly as inspiring a story :-(.
  • From what I understand Flash video is used extensively by YouTube. Flash 8 came out at just the right moment for YouTube to use it rather than QuickTime, RealVideo, or Windows Media Player. It's a big part of the embedding ability.
  • pwb
    I don't think timing or Clark had much to do with the success. The embedding (right out of the PayPal playbook) and scaling were certainly key. Also crucial was going with low quality but fast loading Flash video.
  • Mathew
    Webomatica, I would agree that Flash was an important factor -- that's a good point. It definitely made embedding easier, because it avoided a lot of the "you don't have this plugin" frustration -- not to mention getting around a lot of the craptacular qualities of RealPlayer and Windows Media.

    And Seth, I'm willing to admit that having Jim Clark as a father-in-law probably helped -- I'm just not sure it qualifies as one of the top three secret ingredients in YouTube's success. Of course, you're entitled to your own list.
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