Founded in 2005 by ex-PayPal employees
YouTube was created by Chad Hurley, Steve Chen, and Jawed Karim in 2005. All of them were Paypal employees, and that’s how they met through PayPal. (See How Paypal was founded?)
Inspired by Hotornot
Youtube started as a dating site inspired by Hotornot, the site that allowed people to rate the attractiveness of others before dating them. The idea was mainly a site that allowed people to upload videos of themselves for dating purposes.
Two events are believed to have inspired the idea of the YouTube we know today
It’s believed that Karim, one of the founders, could not find an important video of Janet Jackson online. Hurley and Chen, the other founders, were also unable to share a video of a dinner party they attended without Karim through email.
The founders changed directions
The founders decided that Youtube will be a video uploading site where any person can share his videos. The idea of a dating site based on videos was cancelled.
Youtube got funds very early
According to Wikipedia, YouTube was started as an angel-funded enterprise from a makeshift office in a garage. In November 2005, venture firm Sequoia Capital invested an initial $3.5 million.
More funding in April 2006
In April 2006, Youtube received an additional $8 million in funding from Sequoia Capital and Artis Capital Management.
By August 2006, the company had spent more than $11.5 million
The company was spending heavily on hosting and employee compensation. By August 2006, more than $11.5 million was spent since the company’s inception.
Acquired in October 2006 by Google
Youtube was acquired in October 2006 after Google noticed their growth potential and the large number of videos uploaded on the site each day. (See Why is YouTube so popular?)