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YouTube Founders Got $650 Million in Shares; Sequoia Got $442 Million; Nothing For Music Labels?

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Updated below: This is based on the $470.01 closing share price of Google on Wednesday. Google did an SEC filing today which detailed the shares split between the three YouTube founder and investor Sequoia, among others, for the total $1.65 billion acquisition deal, reports WSJ.
— Chad Hurley received 694,087 Google shares and another 41,232 shares in a trust. Based on Google’ market price of $470.01, that values Hurley’s stake at $345.6 million.
— Co-founder Steve Chen received 625,366 Google shares and another 68,721 in a trust, indicating his stake is valued at $326.2 million.
— Jawed Karim, the third co-founder, received 137,443 Google shares, with an indicated value of $64.6 million.
— Sequoia Capital’s holdings include 941,027 Google shares as part of its Sequoia Capital XI fund, with an indicated current value of more than $442.3 million.
— In total, Google registered about 3.23 million Class A shares to issue to former YouTube stockholders in connection with the acquisition of the video site, according to the filing.
Reuters: At least two dozen YouTube employees received lesser share amounts. For example, Julie Supan, YouTube’s principal spokeswoman, received 10,308 shares worth around $4.8 million.
Lots and lots of more interesting names — including Larry Probst, CEO of EA, and Maury Povich — who received Google shares in the SEC filing here.
Updated: Just had the thought…there were a slew of stories right before and after YouTube’s acquisition announcement by Google last year about some big music labels getting a small share in YouTube, and could be worth as much as $50 million…this NYT story said that Vivendi’s Universal Music Group, Sony BMG , and the Warner Music Group each quietly negotiated to take small stakes in YouTube as part of the music and video licensing deals they did. But nothing in the SEC filing on the payments/stocks to these companies. Not sure of the intricacies of how it would, could and did work, but did this mean a music deal was never signed or possibly that direct stock wasn’t included? Just posing the question.
Related: UMG, SONY BMG, WMG Have Small Stakes In YouTube: Report

4 Responses to “YouTube Founders Got $650 Million in Shares; Sequoia Got $442 Million; Nothing For Music Labels?”

  1. Youtube is one of the most popular video sharing sites on the net. A year ago, co-founders Chad Hurley and Steve Chen were in between jobs, a pair of twentysomething geeks running up big credit card debts as they tooled around a garage trying to develop an easy way for people to share homemade videos on the Web.

    Hurley says, "I do not want to work hard. I want to live a soft life. I want to sleep for three hours every afternoon and nine hours at night. I do not want to stay awake the whole day so that I can get a few 350 grand at the end of each month. I do not want my talents to be exploited by a ruthless employer. I am a lazy man. That is why I choose to live off the net. I am too lethargic to try and survive in the real world. That is why I did not bother to hold down a job though my credit card debt soared.

    "On the net things are handed to me by Google. The idea of youtube came to me from a dinner party with a half-dozen friends in the greatest city in the world San Francisco. It was January, 2005, and we couldnt figure out a good solution. Sending the clips around by e-mail was a bust: The e-mails kept getting rejected because they were so big. Posting the videos online was a headache, too. So we created a site and put in basic software.

    "What I and Steve came up with is a Web site, now called YouTube, that has become an Internet phenomenon. Show the honey and the bees will flock to it. We worked for about six hours each week in a garage like that Apple dude Steve Jobs for two months designing youtube. We had the idea to create a community around the video.

    ?Once that was done we knew that tons of millions of dollars would just flow into our laps after the Google buyour. We will not have to work hard. In the old economy you have to work really hard for a lousy promotion which might give you a few more grand if your employer is very generous. You have to get up early in the morning and run for a few 350 grand each month. On the net you can become rich without working hard.

    "On the net once you have the idea you just sit at home and then magic will happen. That is exactly what happened at Paypal, Skype, MySpace, Facebook. The basic, simple to design software that I and Chen designed allows people to post almost anything they like on YouTube in minutes. People can jack off on porn. Now we are sitting at home retired early after the Google buyout. Content has been handed to us on a silver platter. We do not have to slog hard to create content like a poorly paid online journalist who makes a lousy 450k each year. We do not have to experience daily financial pressure because our site does not get enough readers. We are not under pressure to meet deadlines. We get up at ten in the morning and consider that to be hard work. We do not have to work for ten llllong years. That is the privilege of those in the old economy. they take the tube to go to work for a bum 350,000 dollar paycheck at the end of the month.

  2. corp devver

    typically, the labels would receive a warrant – which is a right, but not an obligation, to purchase youtube shares, in association with their deals.

    the labels wouldn't necessarily have exercised their warrants at change of control. they could exercise later or have been cashed out or they simply didn't receive registration rights with their warrants. in any case, this certainly doesn't mean there was no compensation to the labels.

    btw. unvested and/or unexercised employee stock options are also not listed on the s-3